Research tends to suggest that while trade does indeed reduce poverty, it can only do so effectively where there a number of pre-existing conditions. These are; high levels of education, developed financial sectors, and, hugely importantly, good governance and minimal corruption.
Did anybody else’s jaw hit the floor (feel free to insert your own personal expression of shock) when Liam Fox had the bare-faced cheek to say this in his speech today (October 3, 2016)?
While the UK may be said still to have a developed (perhaps over-developed) financial sector, we’re in deep trouble with the other two.
Conservative policy is to ruin the state-run education system, to ensure that the plebs don’t get uppity and think they can run run anything better than the privileged. Hence Free Schools, the increase in academies, and now the plan to bring back grammar schools. All intended to drain funds and expertise away from your school, or your child’s school.
And, if you hadn’t noticed, poor governance and massive corruption was exactly what caused the global financial crisis in 2008. The Tories had deregulated banking in the 1980s, under Margaret Thatcher, and the bankers had been able to do whatever they wanted for 20 years. They ended up gambling away all our money.
I believe I heard a snatch of Philip Hammond’s speech on the radio, in which he said ordinary households had been working hard to balance the UK’s debts, and that’s right – we have, even though we did not incur those debts. The bankers and financiers who did have carried right on with their gambling.
Mr Fox continued:
In a classical Adam Smith analysis, these factors would enable an economy to reallocate resources effectively and the good news is that there are many more developing countries that satisfy the tests.
That might be true of developing countries but, under a Conservative government, it will never be true of the United Kingdom.
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