The other day, the IMF warned that the Budget deficit this year and next will be some 13% - taking GDP at £1.4 Trillions, that’s over £180 Billion each year. Meaningless eh? How about £15,000 a household over these two years. That’s the real cost of Gordon Brown’s economic incompetence. We’re in the middle of the bitterest recession in 60 years. The IMF warn that we risk a double dip downturn as well as 100% debt to GDP ratio in five years if action is not taken. The possibility of a run on Sterling is included for good measure.
The upshot of Brown’s misrule is that public spending will have to be reined in sharply - some say by up to £100 Billion - to have a hope of stabilising the economy. It will take time to alter things so we can do more for less. Ken Clarke is being honest in warning of higher taxes. History shows that tax rises may will be necessary in the short term, just as Margaret Thatcher found back in 1979. And that’s just to stabilise the public finances and close the budget deficit. Paying down the national debt is a whole different ball game.
Every day Gordon Brown stays in office, the earth is being further scorched to the tune of nearly £500 million. And each day the medicine that will be required to put it right gets stronger and more distasteful. Trident, ID cards, NHS IT projects, carriers . . . at these levels of financial chaos, all the big projects must be in the mix for the difficult decisions. What do Centre Right readers think are the projects we must keep and which should be let go?
