Wednesday, June 23, 2010

The Coalition's Economic Myth Making

During yesterday’s budget George Osborne continued to peddle the myth that the UK economy is in an extraordinary mess with an extraordinary level of debt.

Today he claimed that “having inherited from Labour the largest budget deficit in Europe bar Ireland, the new Conservative-Liberal Democrat coalition has been forced to take drastic action”.

The reality is that as a result of the prudent early decisions of Tony Blair and Gordon Brown we entered the recession with the 2nd lowest level of debt of any of the G7 countries. One of Labour’s key decisions was to use the £20 billion plus windfall from the 3G auction (the mobile phone spectrum) for debt repayments.

The OECD figures for G7 countries for the calendar year 2009 give general government net financial liabilities as a percentage of GDP as:

Japan – 108.3%

Italy – 101.0%

United States – 58.2%

France – 50.6%

Germany – 48.3%

UK – 43.5%

Canada – 28.9%

The OECD figures for 2010 show that the UK’s general government net financial liabilities as a percentage of GDP is 53.5. Lower than the Euro zone average of 59.5.

Other EU countries which have higher levels of debt are:

Italy – 104.1%

Greece – 97.8%

Belgium – 83.3%

Portugal – 64.3%

Hungary – 60.1%

France – 57.2%

Labour put the country on a steady footing to weather the recession. Because of this the budget deficit could have been reduced at a steady pace, without the risk to future growth and without the raid on the most vulnerable in our society. Instead The Coalition has opted to slash public services and hike up taxes in a direct attack on hard working families in this country.

(Credit to Liberal Demolition)


Anonymous said...

were was you or the other 2 at planning on tuesday non of you will ever get my vote again great going to echo but you should of been there to speak

Louise Baldock said...

Oooh, let me think, which LibDems sit on the Planning Committee? I wonder if it is the same crew who sat there last year? LLF? Is that you? You know full well that my thoughts and concerns were given not just in the official report but also with an extra reading of later material. The last phone call I had from the campaigning residents, as they left the meeting, which was recorded on my phone said this "Louise, what you wrote for the Planning Committee was brilliant...." and she knew in advance that I could not be there and we talked about the contribution she would make. So your PITIFUL innuendoes have fallen into the gutter, as have the last 4 years' worth. Did you notice the swing from LibDem to Labour in K&F? Yeah that's right, 13%. Go and try your pathetic little wind-ups elsewhere, nobody who even remembers you, rates you.

Anonymous said...

There is a difference between budget deficit and national debt! But the essential point that we are not as in a bad position as the ConDems make out is still true.