Thursday, October 21, 2010

Good For The Brits So Far - Now Do The Rest

The British economy is in even worse shape than ours. Their deficit is 11.5% of total economic output; ours is 10.7%. But the difference is more than .8%. Unlike American politicians, who don’t have the guts to tell the truth and confront the problem, the new British government is tackling at least part of the issue – the spending part. They’ve announced huge cuts. Government departments will have 19% less to spend. Half a million public sector jobs will be cut. The retirement age is being raised.

For sure, the squeals of outrage and pain are loud, especially (and predictably) from the labor unions. But my sense is that Cameron and his team will stay the course and implement their program successfully.

Unfortunately, along with their American political peers they are part of the chorus line in the hit musical, “Gutless,” when it comes to taking the second step needed to put a fiscal house in order: spend more on growth creating sectors and raise taxes to pay for it.

Raise taxes? Horrors! Bite your tongue. That’s political suicide. I don’t think so. People aren’t as dumb as their voting patterns sometimes suggest. Tell them the truth. Take a stand for sanity. (After writing that last sentence I realize that I’ve stolen Jon Stewart’s Rally to Restore Sanity theme. Well, we both think it’s a good idea.)

Will this happen in our lifetime? I guess that depends on how old you are, but even if you’re not yet old enough to vote I wouldn’t count on it. Unless the situation gets so bad that the truth can no longer be avoided. In which case it’ll be too late.


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