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British Test Case

from Peter Radford

For those austerity advocates amongst you: may I draw your attention to the plight of the British economy?

Its’ headed down again. There’s a distinct possibility that it will enter recession. Make that a third recession. A rare triple dipper. The prolonged slump pervading Britain has now lasted longer than the Great Depression. It is taking an enormous toll. It is steadily eroding the future potential of the economy.

And it is entirely a manmade problem.

Manmade as in Conservative party made..

The British government, for ideological reasons, decided to trash the British economy, It is doing a fine job. So good is its effort that it surely would be eligible for some prize, were prizes given for most asinine, antisocial, deliberately destructive, and all round stupid economic policy.

You see the good old Conservatives, with an able assist from their Liberal-Democrat partners in crime, decided to ignore every single lesson of the Great Depression. The entire lot. It’s as if the 1930′s never happened. And especially no Keynes.

Instead they decided to replicate with enormous attention to detail every single policy error that led to the disaster of the 1930′s, and then add a few new twists of their own.

The point being that cutting government spending right at a time when private spending has also collapsed is a well known, highly documented, and historically faithful recipe for economic calamity. Those who go down such a path are clearly sociopathic. They are deluded. They are mean spirited, nasty, and ignorant. They double down on trauma whilst arguing they are curing the original disease.

The only explanation for inflicting such deliberate harm on your fellow citizens is that you are bat-bleep crazy. Or manifestly stupid. Or both.

Anyway: be warned austerity folk. We have a contemporary example of the consequences of your policies.

An example of their bankrupt rot.

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  1. Nell
    January 28, 2013 at 12:59 pm

    What more is there to say? The actions of the UK goverment are criminally stupid, or as Bill Mitchell remarks, “One gets the impression that the masters of these policy impositions harbour socio-pathological tendencies.” Given the upbringing of Osborne and his coterie, this may be more accurate than we care to acknowledge.

    http://bilbo.economicoutlook.net/blog/?p=22527&cpage=1#comment-28219

  2. January 28, 2013 at 8:48 pm

    Except that the Keynesian remedy is inflation and does not address the real problem, which is an unacknowledged supply-side blockage.

    It is not acknowledged because it is too obvious. Count the number of “For Sale” and “To Let” signs outside commercial properties in Britain. According to theory, rents and land prices should drop to market-clearing levels. But this is not happening, thereby causing the unacknowledged supply-side blockage that is holding the British economy in irons.

  3. Herb Wiseman
    January 29, 2013 at 7:02 pm

    Connect the dots. The other recent posts about income distribution are of interest and my guess is that if you superimpose the growth of government debt on the income distribution curves since 1947 you will see a strong correlation. How much of the interest paid on government debt is transferred to the 1 and .1% of income earners who have doubled their share of the national income in the USA ( and probably other countries) between 1947 and 2007. I have noted that incomes of the 1 and .1% curved upwards in the mid 70s which also coincides, I believe, with the curve upwards of national debts. This change also reflects in Canada at least the change in the policies of the Bank of Canada to fight inflation with high interest rates and increase government borrowing from the private financial sector (BoC lending to the gove’t declined from approx 20% in the 70s and earlier to the current levels of les than 5%). It is also worth noting that the growth in government debts coincides with compound interest on the debt and NOT increased spending per capita on social programmes. Of course there appears to be an inverse correlation with the wage stagnation/decline of the 99%. It is interesting to note that in the early 70s the Trilateralists met and planned this setting up so-called think tanks such as the Frazer Institute in Canada and Round tables (?) in other countries to bring about these changes under the guise of austerity being necessary to ratchet down expectations by the 99%. This is not a conspiracy because none of it was done in secret. It is just a continuation of the class struggles of human history.

    • January 29, 2013 at 9:52 pm

      How did they do it?
      For the answer read; “The Role Of Money” by Noble Laureate Frederick Soddy.

      http://archive.org/stream/roleofmoney032861mbp/roleofmoney032861mbp_djvu.txt

      THE ROLE OF MONEY-WHAT IT SHOULD BE, CONTRASTED WITH WHAT IT HAS BECOME.By FREDERICK SODDY ; Nobel Laureate ..
      Excerpt: “…
      It is con-
      cerned less with the details of particular schemes
      of monetary reform that have been advocated
      than with the general principles to which, in the
      author’s opinion, every monetary system must at
      long last conform, if it is to fulfil its proper role
      as the distributive mechanism of society. To allow
      it to become a source of revenue to private issuers
      is to create, first, a secret and illicit arm of the
      government and, last, a rival power strong enough
      ultimately to overthrow all other forms of
      government.

  4. Si
    January 31, 2013 at 9:46 am

    ….. and the US slipping into negative GDP despite the huge spending??.

    When Gov’t spending is part of GDP of course GDP will go down if it spends less. When the UK was buzzing with North Sea Oil or the boom were there cuts in Govt spending? Nope? So just when IS a good time to reign in overspending?

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