Saturday, 11 September 2010

The UK Trade Union Congress is very upset - good!

I have always said that the best way to judge the soundness of a policy is if the hard-left like it or not.  If I'm unsure on an issue, or do not have the fullest knowledge and am unsure of where to stand, I simply look to the hard left, see what they think, and do the opposite!  When I find out more about the policy in question, I usually find that my instict has served me well.

So, despite my uncertainty about the Con-Lib Coalition and the softly softly approach it is taking to so many issues such as tackling the National Debt, when I see the hard-left Trade Union Congress (TUC) come out and condemn the proposed spending cuts as "reckless", warning that it will cause "irreparable damage", then I breathe a sigh of relief that Cameron's coalition are at least doing something right!

It is amazing, but not surprising, that the Unions are insisting on absolutely no spending cuts, arguing instead for tax hikes, and probably even more spending.  Not only are taxes already too high, and spending deficits dangerously close to those of Greece, we know from experience that tax and spend doesn't work for a whole range of reasons too numerous to go into here.  We know this specifically from the 1970's, where trade unions were given free reign, and Keynesian tax and spend economics were put into play. The public sector grew and grew, tax rates went into the 90% region and Britain fell to its knees. Communist unions throttled the life out of the nation and nearly destroyed us in the process.  It took massive intervention by Margaret Thatcher in the 1980's to a) put the economy back on track and b) to crush what was essentially an attempt at a socialist takeover by Arthur Scargill and the National Union of Mineworkers (now a member of the TUC unsurprisingly).

Over the last 13 years, the Labour government has slowly moved back to those same policies that destroyed the country in the late 70's, and now it is time once again for the (primarily) Conservative government to fix it.  Yet hard left groups like the TUC, who are so tied up with vested interests in the public sector and blinded by their ideological commitment to socialism, are going to fight tooth and nail against economic recovery just as they did throughout the 1980's.

It comes down to a basic case of "Turkeys don't vote for Christmas."  The cause of this crisis that Britain is facing comes from excessive growth of the public sector over the last 10-15 years, and the soaring spending that naturally comes with such a growth.  Such spending has been accompanied by high taxes across the board, which has strangled the private sector and sent business investment abroad.  The answer to the crisis is therefore to cut spending, cut the public sector down to size, and to cut taxes - something that the Coalition has slowly started to do.  This will deal with the deficit and stimulate the private sector, which would in turn increase tax revenue as there would be more wealth to be taxed, albeit at a lower rate.

Yet the TUC is simply arguing for more of what got us into this mess in the first place.  It is important to cut through all the talk about how these cuts will hurt the "poor" - this is false. The unions are choosing to ignore the good that spending cuts will do to the private sector and private sector employment (which will benefit the poorer more than anyone else, as it is they who are more likely to be unemployed), instead focusing on the damage it will do to their vested interests.  Yes, this will hurt the public sector, and it will trim it down.  But that is because it needed trimming down in order for us to have significant private sector growth and to make the economy sustainable. The public sector, on the other hand, was choking the country, and was/is entirely unsustainable.

Emotionally charged language from vested interests in the public sector about the "poor and dispossessed" must be ignored.  A bloated public sector and excessive tax and spend policies do not work, and a failing economy helps no-one - not the rich and certainly not the poor.  The only way to end poverty is to have job creation and social mobility.  Welfare and high spending only damage these goals, and make poverty even worse by creating poverty and welfare traps that keep the poor poor.

The coalition must remain strong and cut spending as is necessary, and must tackle the toxic political language spewing from hard left groups like the TUC that want to drag us back into the misery of the 1970's - the future of the country depends on the coalition remaining strong.

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