A Double-Dip Recession
It was depressing news that Britain has gone back into recession. Unlike the United States, where President Obama has pursued a very different economic strategy to this country, Britain has experienced negative growth for two consecutive quarters. That means we are now going through a double-dip recession.
We are now experiencing exactly what Ed Balls, the Shadow Chancellor, warned might happen. It gives me no pleasure to say ‘we told you so’ because the recession will mean the loss of jobs and livelihoods for thousands upon thousands of people.
One of the main reasons why our economy is stubbornly refusing to grow is the massive public spending cuts which the Government is pushing through. In all common sense, the Westminster Government needs to recognise that we must have a balanced programme of debt reduction but at the same time providing support for businesses to grow.
Sadly, the response of the Tory-led Government is to refuse to do a u-turn. Instead it may actually increase the extent of Government cuts. If this were to happen, the social and economic consequences would be truly horrific. As things stand, the ‘cuts’ are really starting to bite even though less than a third of the planned cuts have been implemented. If there were even more cuts things will get significantly worse.
In real terms for this area the cuts mean increasing unemployment, further reductions in welfare benefits, fewer police, declining local authority services and increasing pressure on the health service. At the same time all the indications are that the top 5% in our society – which doesn’t include anybody I know in Caerphilly – will get ‘richer’. The recent Budget was part of that programme of reducing public expenditure but at the same time reducing the 50p tax rate for those who earn £150,000+.
No sensible person would argue that Britain’s deficit should not be reduced but it has to be done reasonably over an appropriate timescale and in a way which does not undermine the economic growth which we so badly need. I only wish that the Westminster Government would see things this way.
Wayne David
Labour MP for Caerphilly
This Tory – led Government just don't understand the realities of life for the majority of people in this country. The budget offered a tax cut for the super rich whilst hitting pensioners and ordinary families. Here in Caerphilly however Labour is offering a completely different programme.
The Labour manifesto for the local elections on Thursday calls for investment in schools, youth services, community safety, creation of jobs & apprenterships and the scrapping of Plaids stealth charges such as furniture collections and replacement whellie bins.
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I too agree that cutting the 50% rate is pointless. I am waiting for a government, any government, that can manage to extract even 20% income tax from those with extreme wealth.
The issuse of the recession is not connected with this top tax rate though. Even if all the wealthy paid their taxes as honestly as the cleaners, factory workers and shop assistants there would still not be enough of a tax take. The truth is that in this recession, as in all previous ones, it is the poor and those in the middle that will have to bear the brunt of the affects of the cuts and the tax rises. A low paid worker can pay more in National Insurance than income tax and it is this tax on jobs that should be abolished first.