As regular readers will know the public or state sector of our economy is parasitic on the private sector, where all the wealth is generated. Not only that, the state sector is only about half as productive as the private sector yet is more highly paid. And the activities that the state sector undertake are centrally dictated instead of being driven by the market, which makes them even more inefficient. Currently, thanks to the gross ineptitude of the last Labour government, the state sector has ballooned to become over half the British economy, an immense burden on the private sector who have to earn the money to pay for it. Especially as the last Labour government borrowed like crazy to pay for their profligacy. Debt that interest has to be paid on and which needs to be paid back.
The current government is trying to cut public expenditure whilst increasing taxation in what is a vain attempt to balance the books. They have been very timid, merely rolling back a few years in expenditure terms. This is because they are fearful of making things worse with an unemployment led recession. They need not fear, the private sector is employing new people faster than the public sector is losing them. There are always jobs for good people and still plenty are arriving here from Eastern Europe and finding jobs.
Now the Office for Budget Responsibility (OBR) says that we are headed for big trouble. State expenditure is still far, far too high. Government debt as a percentage of Gross Domestic Product (GDP) is currently under 70%, in itself this is a shocking figure and is the heritage of Gordon Brown’s economic mismanagement. However it is forecast to rise to 107% by 2060. As a nation we are peering over the edge of a precipice and are heading for a situation far worse than that of Greece. Nobody is big enough to bail us out.
It is a simple matter of fact that the less a state is involved in an economy the more successful that economy is. 100% state control, as in the old Soviet Union, is a recipe for disaster, whilst a state that is 20% of the economy, as in China today, is a recipe for booming wealth. You only have to look at the vast success of Hong Kong and Singapore over the last 20 years to see the benefits of a small state. This is what Britain needs, a huge cutback in the size of the state which would allow the private sector to grow and generate lots of wealth. Here are some policies:
- Repeal legislation that costs money to implement. Especially political correctness and health and safety laws. Let people go back to using common sense.
- Break the monolithic health service up and make it a competitive market funded by insurance, with a government safety net.
- Increase personal taxation allowances so people who work pay far less, pay for it with an increase in VAT, so people spend less.
- Introduce compulsory workfare for the unemployed. If they don’t turn up and work they get no money.
- Minimally enforce European legislation, instead of gold plating it as is now the case. Go back through previous European legislation and pare it down to the bone.
- Increase retirement age again towards 70 for the state pension and for public sector pensions.
- Wage freeze the massively overpaid sectors of the public sector, GPs, policemen and firemen for instance, till inflation brings it back to where it should be.
- Massively liberalise planning permission, especially on the ridiculous greenbelt. Expand the national parks to protect our real countryside.
- Reduce the legislative burden on business. Make it as simple as possible to start and run a business and so generate wealth.
- Get rid of employment protection legislation. Free up the labour market so people are doing the right job in the right place for their abilities.
- Build a huge brand new airport east of London with fantastic infrastructure. The lack of this is immensely damaging to our country. European competitors are now better connected.
- Instigate a massive cull of national and local government. De layer management and institute wage caps (very many senior local government officers are outrageously overpaid). Close down entire departments.
- Concentrate education improvements on the bottom 50%, so we generate a workforce that is employable.
- Massively increase criminal fines, especially for career criminals and confiscate their goods to pay the fines. Only imprison those who are a menace to society.
- Do not give any state aid whatsoever to economic migrants who have not contributed to our economy. Significantly raise the bar for asylum seekers. There are billions of people in the world who probably currently qualify.
- Prune our armed forces back to our real needs. Do we need all those tanks in Germany, warships scattered around the world etc etc? Build big volunteer reserves for emergencies. Cull senior officers by at least 75%. Don’t fight other people’s wars.
- Re-jig the rules of the dependency culture so it doesn’t pay to join a dissolute underclass. Especially stop babies from being used as an income stream.
- Close down the disability gravy train except for the relatively few who are genuinely incapable of work.
Depending on your political viewpoint you may think that some of these are radical. But we will see many of them, there is no alternative.