LETTER: Government should have Plan B instead of cuts

IT is encouraging that a major group of economists have written to The Observer calling on the Government to a Plan B and abandon its cuts in public services and welfare.

It is discouraging but all too predictable that the Government has said it is “steady as she goes” with the cuts as our country’s economy continues in stagnation.

We know the cuts are hurting but we also know they are not working.

Our country’s problem is that we have two and a half million unemployed since the bankers collapsed the economy in 2008 The unemployed, and it is not their fault, damage our tax base and cause our country to lose billions in tax and national insurance income, as well as cost billions in benefits.

This problem is exacerbated by the billions lost by tax avoidance by the very rich, including shamefully by the Chancellor of the Exchequer.

We should be investing to get people back to work as in the 1930s (remember Keynes?) and as after the Second World War and as in Japan (after a decade of cuts and stagnation) in the late 1990s.

Our country can, indeed must, afford it. The UK’s debt ratio indeed is the lowest of the advanced economies. You won’t hear the Government say this. They will say the country has “maxed out” its credit card and is near bankrupt. That’s a big spin to justify their small state approach, but the UK’s debt ratio is 60%, Germany’s is 72%, the US’s is 95% and Japan’s is 200% (Source: CIA Yearbook).

So we must invest to get people back to work (one in five young people are unemployed).

In mid 20100, before the cuts the UK economy was recovering and growth was 2.5%. Now the cuts bite and growth is down, and ongoing stagnation looms.

It is quite simple and basic. People in work are productive economically, socially and morally. If the Government won’t go for Plan B, then this Government must go.

TIM ELLIS

Colne

(via email)