Tory Liberal failure on the economy – Double-Dip recession

With the news that we are officially in a double-dip recession period LINK it is becoming clearer that the Tory Liberal economic policies are fundamentally flawed. Yes, they inherited a large deficit, but they also inherited a growing economy.

Cutting too far too fast has recklessly damaged the UK’s good prospects of getting our economy moving again. So far, the Tory Liberals have increased unemployment by

  1. Slashing jobs in the public sector on the unsubstantiated claim and risk that jobs will miraculously appear in the private sector to make up for the rise in unemployment in the public sector
  2. Increasing VAT which has an impact on a business’ take home profits, meaning that they have less profit available to employ people and expand
  3. The VAT rise also impacts on consumer spending and disincentivises businesses
  4. Scrapping the Future Jobs Fund which equips young people to be work ready. Indeed the long term impact of this has also been ignored by the Tory Liberals. Even if there is a lack of employment opportunities in the country, it is important that these schemes are invested in so that people are equipped with the skills they need and are work ready for when the economy does recover and there are jobs for people to go into.

Unemployment should never be a price worth paying. The immediate and long-term impact of worklessness is far worse than pursuing an aim to get rid of the deficit in four years. The Tory Liberal Government have made this their priority and ignored the impact that this damaging course has on ordinary people.

The VAT rise also had a detrimental impact on inflation. Naturally, it costs more to buy products because there is more tax paid on spending money. This leaves less disposable income to the individual and what’s more, wages are not going up with inflation. People are being squeezed with higher costs and lower income.

This brings me to my final point on the deficit, which has increased under this Tory Liberal administration – LINK

Growth is a key component to tackle the deficit. Without economic growth, it becomes difficult to address the deficit. This has been the Tory Liberal Coalition’s main failure. There is the issue of the Eurozone crisis that the right wing Government will point to. However, slashing public sector jobs with a front loaded approach and the VAT rise are policies of the Government’s own making.

The Tories are out of touch with ordinary people and their stance on the 50% tax rate at this very moment in time is testament to that. The Liberals aren’t bothered about issues such as employment, jobs, the economy, crime and the NHS – this is proven with how easily they flipped their position on these what I consider core issues. They are far more concerned with the House of Lords and the electoral system and appear more principled on these issues than ones that have a more profound impact on people.

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Cllr Hirani Slams Brent Tory Liberal Hypocrisy

I was absolutely dismayed at the level of hypocrisy shown by the Brent Liberal Democrats and Brent Tories at the Full Brent Council meeting this week. I tabled a motion at the meeting reading, “This Council condemns the £104 million cut to Brent’s Budget over the spending review period”, which Brent Liberal Democrat and Brent Tory Councillors failed to support.

While appearing to fight for local services they have adopted a peculiar position of apparently supporting the Coalition’s chosen method of cutting public spending which has led to more cuts to Brent’s Central Government grant than in other Councils.

There are two main arguments floating around as to why we have a large public debt. In short, one that it was a global economic crisis that led to a collapse of the banking system meaning that the Government had to borrow to stimulate the economy, bail out the financial sector and lost out on projected tax revenue income. The second that Labour public spending was out of control and is to blame for the country’s deficit and deficits of USA, Greece, Spain, Ireland, Germany, France and many more, which we have to pay for now.

Regardless of what line of argument you believe, I thought that all Councillors of all parties would be unified in condemning the scale of cuts to Brent compared to other Boroughs.

Even if you believe that the scale of cuts is necessary nationally and that the debt should be tackled within one Parliament (The Coalition Government’s original plan A on the economy), is it fair that Brent Council has to make cuts in the region of 27-28% of our controllable budget whilst other Councils are not being hurt as bad as Brent? Brent is losing out on £73 per resident whereas Guildford faces a cut of £10 a person and Richmond £5.39 a person.

If Brent Tory Liberal Councillors do blame Labour for creating the deficit, do they believe that people in Brent caused the recession more than residents from other areas and therefore should be made to pay and suffer more?

UK Government debt reaches £1 trillion under Tory Liberal Coalition’s economic plan

Figures out today show that debt under the Tory Liberals has increased and passed the Trillion Pound mark.

Graph obtained from Coffee House Spectator blog

The Tory Liberal approach to tacking the budget deficit, cutting too far and too fast without having a plan for growth has already produced high levels of unemployment, growth revised downward from 1.6% under the Labour plan to address the deficit to 0.6% under this Tory Liberal plan.

Unemployment has not been this high since David Cameron was an advisor to the Thatcher Government. In addition, youth unemployment is having a damaging impact on our next generation.

Inflation is also higher than in previous years with the cost of living rising and the Government making things worse by increasing VAT. All this further supports Labour’s call for a five point plan for jobs which I have blogged about in the past here – LINK.

Full Council meeting yesterday

Logo of Brent London Borough Council

Yesterday was the first reading of the Budget in the Brent Town Hall Council chamber.

There is a bit of a gloomy outlook with Brent having to make further cuts to the Budget as part of the wider £104 million that Brent has to make over the comprehensive spending review period.

Tory Liberal Councillors did their best to let the bankers off scot-free and set the blame on the previous Labour Government.

However, I spoke and made a contribution saying that regardless of whether you believe that the international banking crisis or the previous Labour Government and Gordon Brown is to blame for the country’s deficit and deficits of USA, Greece, Spain, Ireland, Germany, France and many more…. why don’t we think about Brent for a second.

Even if you believe that the cuts are necessary and that the debt should be tackled within one Parliament, is it fair that Brent Council has to make cuts in the region of 27-28% of our controllable budget whilst other Councils are getting more money?

How can the Brent Tory Liberals defend Brent losing out on resources while other areas are having Budget increases?

I have blogged about this before LINK.

Why should Brent have to cut more than others? If Tory Liberal Councillors do blame Labour for creating the deficit and the Coalition Government are holier than thou, are they still defending the level of cuts to Brent compared to others and supporting the damage made to Brent while other Councils are being given more money?

Brent Councillors March for the Alternative

Brent Labour Party Councillors participated in Saturday’s demonstration in support for the argument that there is an alternative way to address the deficit without needing to make cuts so fast and so deep.

 

Labour Councillors across the country, as well as Tory and Lib Dem have had to make difficult choices to balance budgets because of front-loaded cut targets imposed on them due to the Government’s deficit reduction plan. I marched sporting my London Young Labour T-shirt under the Brent Central Labour Party banner along with members of the Dudden Hill Labour Party and other Brent Labour members and Councillors because we disagree with the Government’s method of reducing the deficit which goes too deep and is too fast.

It would be “immoral” to “burden the next generation with higher debts” – The Liberal Democrats

The Coalition of cabinet millionaires just do not have a clue how difficult their intention to treble fees will make going to University for young people from middle and lower income families.

They have benefitted themselves having free higher education and now they want people to pay up to £9,000 a year in fees. If we’re all in this together, every MP who votes for the fee cap rise should pay £27,000 into the higher education system.

THIS WILL RUIN THE LIFE CHANCES OF A GENERATION!

They are intent on tackling the deficit within one Parliamentary term because they say that the economy should not be built on a foundation of debt. But they think it’s ok for young people to be consigned with debts of up to £50,000 and build their whole lives on a foundation of debt. Where is the logic in that?

When they wanted to sell these extreme cuts, the Conservative and Liberal Democrats would turn moist-eyed and say it was “immoral” to “burden the next generation with higher debts.” So as a solution they have introduced a program that will burden the next generation with much higher debts.

Johan Hari, the Independent

During the years when young people have begun to work, are at the prime age to start up families and enter the housing market for the first time, a chunk of their disposable income will be removed from them at the time when they are in most need of it as they will have to deal with their student debt – thereby affecting their future life choices.

The Lib Dem comeback seems to be that it’s all Gordon Brown and the previous Labour Government’s fault. I disagree strongly – but you can blame Gordon Brown all you want… it doesn’t change the fact that Nick Clegg lied.

Directly challenging the view that we’re in this financial mess because of Labour

Labour’s fiscal stimulus helped make sure that recession didn’t turn into depression and that stimulus meant that people did not lose savings in their bank accounts, or mortgages didn’t collapse along with the banks, which would’ve led to people losing their homes.

Yes, Labour did borrow to help us recover from the crisis and that is why we now face a large public debt. But there is an alternative to paying back that debt. The Labour alternative presented at the last election was to first focus on recovery and pay back 50% of the debt within the next Parliamentary term (4 to 5 years). The Lib Dem / Tory plan is to pay it all off within the same timeframe and starting the cuts now risks economic recovery as the first year following a recession is always fragile. Even Thatcher didn’t make any cuts following first year following the downturn in the 1980s.

Figures from the independent Institute for Fiscal Studies show the difference between the current plans that are due to be implemented by the Coalition Government and the Labour alternative.

(Data Source: Institute for Fiscal Studies, Image Source: Left Foot Forward)

At the last full council meeting, Lib Dem group leader Paul Lorber barked on about blaming Labour for the state of the economy, ignoring the role that banks had to play.

But to say Labour is the reason why we’re in this mess is simply wrong… it’s irresponsible bankers that got us into this mess, and they should play a strong part in bearing the brunt of the costs for the role that they played getting us into this mess. While the Lib Dems and Tories are pushing out the message that Labour is to blame, the bankers responsible for the crisis are getting away with it.