Tuesday, November 25, 2008

Brown's Borrowing Binge


The legacy of a decade of Labour and Gordon Brown is that Britain is worst placed amongst major economies to weather the economic storm.

Yesterday Labour embmarked on a massive borrowing binge which will leave the country more indebted that at any time in history. With national debt set to exceed a trillion pounds Brown will borrow more than Dennis Healey did before he went cap in hand to the IMF and more than Winston Churchill during the Second World War. Gordon Brown will next year alone borrow in excess of £100b and more than the entire NHS budget.

The country now faces huge unexploded tax bombshell with taxes set to rise dramatically in the future to pay off Brown's debt mountain; rises in national insurance, income tax and car tax.

2 comments:

David Furnell said...

Jeremy
I don't know if you have noticed but we are in the middle of a worldwide recession and govts around the world are attempting to copy Gordon Brown and are borrowing now to reflate their economies. We could have had lower borrowing by allowing the banks to go bankrupt and doing nothing. I had hoped that the Tories had learnt the lessons of the early eighties but obviously not.

Jeremy Moulton said...

David, both France and Germany have examined the idea of a VAT cut but rejected it due to concerns about its effectiveness.

Prices are already being slashed on the high street due to falling sales. The Chancellor's VAT cut won't help people with their food bills as VAT is not levied on it and this is one area where prices are still rising.

The IMF have advised that only countries with a balanced budget should be attempting a fiscal stimulus and have also warned that Britain faces one of the worst recssions of the major developed countries.