Tax Research UK » The key economic questions the Tories must answer

Richard Murphy predicts that the Conservative Government’s economic plan will cause a recession.

To summarise the Tory economic promise is easy. As Martin Wolf has put it in the FT the policy means that:According to the International Monetary Fund, the share of government spending in UK gross domestic product will fall from 41 per cent in 2014 to 36 per cent in 2020.

We all know that this is not necessary: as Paul Krugman and many others have pointed out not only is there no need for austerity, and, as I have often argued, cutting government spending at a time when consumers are not racing to the shops, business is pulling back on investment plans and the trade deficit looks dire, is a simple guarantee that not just the state will shrink but the economy with it.

Source: Tax Research UK » The key economic questions the Tories must answer

5 thoughts on “Tax Research UK » The key economic questions the Tories must answer

  1. Rupert Mitchell (@rupert_rrl)

    The Tory Austerity plan is an excuse to cut aid to those of us who really need it in order to further the profits of those who absolutely don’t.

    I haven’t heard of any UK operated businessmen complaining about current taxation levels and most seem to be doing pretty well at this time.

    Reducing taxation for those super-rich companies while cutting benefits to the general public will reduce profits for those super-rich companies which rely on domestic consumption; money in the hands of the domestic consumer can only help profits whereas a cut-back can only reduce them.

    As for the “non-doms” they are an entirely different matter as no company should be allowed to trade in this country unless they pay tax on their profits in this country.

  2. hstorm

    Some of us have been screaming this loudly for years, but Gidiot just covers his ears and stubbornly keeps steering us straight towards the wall.

  3. amnesiaclinic

    His conclusion is that recession is inevitable and that the tory manifesto may be the shortest suicide note in history!
    This is exactly what many others as well as Paul Krugman have been saying for a long time.
    It may be sold as prosperity but not actually so.
    It will still be very painful and we have to prepare for that and help others as much as we can.
    Be organised but in peaceful ways.

  4. Nick

    I watched an excellent lecture by Steve Keen on Youtube entitled “Should governments run surpluses?”. It’s very long but it clearly shows that running a government surplus for very long without a trade surplus is economical suicide. There’s also an article by him on Forbes which is a bit easier to digest. The Tories’ plans are pants on head stupid. Labour wouldn’t have been much better.

    1. Mike Sivier Post author

      Labour would have stimulated the economy so it seems the idea would have been to build up a trade surplus.

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