The Economy

There are signs of an economic upturn, including better than expected unemployment figures. So are we on the right track? It depends which economist you talk to. I am not an economist, but if you ask me the answer is no.

Let us liken the economy to a car. As it proceeds down the highway sometimes it will go faster and sometimes slower, depending on traffic conditions. Whether it goes fast or slow is not to do with the car, it is to do with the traffic. But if the car is not maintained and tuned it will splutter and stall, making  progress  in fits and starts, not because of the traffic but because of the car. Indeed other cars will pass it, leaving it way behind.

The recession was due to a collapse of world trade. This is akin to a traffic jam. Other countries have emerged quickest because their economies are basically tuned and if trade picks up so will they. The fundamentals are right. In our economy the fundamentals are wrong. Overhaul is needed, or we are destined to stutter from boom to bust while the world moves on. We have already dropped from four to six in world rankings. Another ominous, if symbolic,  sign is the news that we are having to cut our anti terrorist activities overseas due to the fall by about 20% in the value of the pound as these costs have to be paid in foreign currency. A good deal of our national and personal debt is ultimately owed overseas also. You can do the sums.

If we are to move on at the pace of the rest of the world, we have to re-model our economy. We have to save more, borrow less and earn more of what we spend. We have to cut service based costs and jobs many of which are futile and actually are a burden to the economy. Instead we have to rebuild our industrial infrastructure so that we make more of what we use creating real wealth and wealth creating jobs.

Above all we have to unravel the disaster which is the City of London. Of course it is the biggest in the world because no other country would be fool enough to have such a lunatic foundation to its economy. Who cares whether they all go abroad? The wealth it creates is illusory and described as socially useless. The cost of holding this bust casino together is real and its impact socially disastrous. Because of it day care centres are closing, libraries face the axe and we have to cut back on protecting ourselves from terrorists. How dare those oily bankers pretend there is any justification for those bonuses.