A 25% cut in public spending would seem extreme in midst of a deep recession like the one we have today. But the new conservative Prime Minister of Britain is planning on cuts far deeper than that.
David Cameron is ready to approve the biggest public-spending cuts in the history of the developed world in a dramatic bid to cut Britain’s soaring national debt.
He has ordered Cabinet Ministers to draw up ‘Doomsday’ savings of up to a staggering 40 per cent which could see vast parts of the public services shut down and tens of thousands of policemen, teachers, town hall workers and other civil servants lose their jobs.
The proposed cutbacks are even more extreme than emergency reductions used in other countries such as Canada and Ireland and are double the amount of the Geddes cuts imposed after the First World War when Britain faced bankruptcy from government debt and waste.
That doesn't mean that Britain will actually cut public spending by 40%. The alternative plan is to cut public spending by 25%. The 40% cut is probably being held out as a threat.
But if the 40% cut becomes reality then the level of austerity in Britain could create civil disorder.
Let's return to 1896
with debtor's prison, people let to rot and die in the street and no social safety nets and of course no income tax on the rich.
I'm reading a host of pieces, including the great Elliott wave "super cycles" types of pieces (we have a blogger post an analysis on this and for the life of me, I cannot find him or his piece, was going to invite for an update on these)...
claiming we're going for the biggest market crash since the South Sea Scam. These aren't just your classic CT type fringe sites, I"m seeing these on major press like NYTs, MarketWatch.
More on Britain's austerity
For such a small nation, these numbers are staggering.
Exactly how is the world economy supposed to grow when both Europe and America are moving towards austerity?
unbelievable, what's wrong with these people!
On the 4th I was at a loss because all of the policies that would turn this around, our glorified neo-con in a Democratic wrapper administration will not even try to enact or pass.
Seriously, what are we to write about at this point since our government will not listen? Write it anyway?
It's like the globe is hell bent on enacting a depression.
Austerity in G20 is Global
While it it is truly frightful to watch the austerity meltdown on a global basis. It is our turn, maybe our duty, to lay down what we are sure will happen:
Global Depression
Global War
Unlike 1936 when taxes were raised for Social Security, UI and Capital Gains rates were set at 12.5 percent, we are in a 18 month sweet spot of low taxes on a personal and corporate basis. So when the double dip starts we can say with certainty that choking off business credit by the banksters, free trade agreements in place and sprawling and punishing austerity put on all levels of government worldwide.
Condition are a scientific control case for
the historical debate about the 1930's. Free traders Smauley Hoot Tarriff, now we have free trade. Starve-The-Beast - Club for Growth got 10 years of declining tax rates. The residual similarity to the 1930's is credit - or the lack of it then and now, and stimulus and its demise.
Burton Leed