Rodney Willett sent me a tweet and invited my views on the following article. His article is well worth a read and I set out my response below.
Regular readers of this blog will know that I am passionately:
I favour a balanced model:
- Growth AND
- Austerity (targeted over the medium term)
My political views and my inherent bias are on record on my blog. You may wish to check this out!
Unlike Prime Minister David Cameron, I am proud to declare my political views but respect that they give me an inherent bias in my views of the World and indeed colors how others view me. My political beliefs in summary are:
- Libertarian, rather than authoritarian
- Internationalist and Pro-Europe
- Right of centre , favouring strongly individualism compared to state
- Strongly anti-bureaucracy, favouring small government
- Pro democracy
- Anti corruption
- Pro Keynesian and anti monetarist (I favour a belt & braces approach with sound monetary policy, good fiscal discipline but leaving room for state intervention where necessary)
- Pro Monarchist
Returning to Rodney Willett’s article, I believe that UK Chancellor George Osborne has embarked upon “Unplanned Austerity“. Osborne has applied the bacon-slicer and top-sliced the Public Sector‘s budgets, with cuts falling on front-line services like healthcare, education, and military capability. David Cameron’s Government has been proven to be an omni-shambles on Public Sector Reform. Let’s be clear, David Cameron’s Government does not have:
- Strong leadership
- Overarching vision
- Coordinated and carefully analyzed strategy, and
- Fully risked assessed, properly costed and effectively managed delivery plans
However, I agree that with the UK’s debt levels, there is a place for carefully “planned austerity“. Personally, I believe that former Prime Minister, Gordon Brown, made the right judgement calls in the financial crisis of 2008 and was a powerful player on the international stage at that time, unlike his successor David Cameron who has reduced the UK’s influence in the World.
What is required is, first and foremost, huge stimulus to increase demand, with massive incentives for both public and private sector capital spending, with the Government underwriting guarantees. At the same time, the Government must announce properly costed and risk assessed “planned austerity” program, targeted at comprehensively remodelling the Public Sector in the medium term, with serious consolidation, de-layering, reduced pay levels, transformation and widespread outsourcing.
Of course, the above model is generalizable and equally applies to the EU and reducing the EU bureaucracy. It would also be appropriate for a 2nd term, President Obama. In many respects, a twenty-first century Marshall Plan is required to stimulate growth – Christine Lagrande, Managing Director of the IMF would be an ideal sponsor.
What do you think?