Osborne buries bad news as OBR predicts extra 130,000 unemployed

Tonight, my local Tory MP said this in her email newsletter:
“I have avoided the party political spiel as to the state of the country’s finances…”

Now we know why…

Jonnyprice,

You ask:

“How can Labour blame the cuts for stalling growth when nothing has been cut yet?”

For this statement to be true you would have to demonstrate that consumer spending is a collective description of mass spur of the moment whims. This would perhaps apply to the purchase of a Mars bar, but not for larger ticket items such as an automobile, new cooker, etc. Consumer confidence, on the other can and does have a forward looking component, and can last longer than the events which have engendered its lowering.

It has been argued that the stimuli provided by the previous government has run its course, and with a stagnant economy and lack of government supplied incentives to consumer spending, (the budget provided specific incentives for business costing, not new business i.e. sales promotion, such as the previous government in the case of the auto industry, consumer spending has, and will continue in the short term at least, to flounder.,

Anon,

You say:

“This is a budget to win the next general election – not one designed to be popular in the short term.”

While I would not dispute the likelihood that Cameron, Osborne and the Libdem hangers on fondly hope that all this negative Karma of rising unemployment, economic stagnation in continually downgraded growth estimates, inflation, etc. will all go away by the end of this parliament, I doubt that this budget will be a building block to their ongoing and rather dubious current electoral success. The Tories did not get a majority in the recent election despite the worst electoral circumstances that Labour could undergo. You continually berate Ed Miliband’s in electability, but overlook the fact that Cameron was and is no shining star.

Osborne boasts that his reduction of corporate tax will stimulate business growth. I do not accept the automaticity that equates a location where profits are declared and were production is undertaken. I do not feel that the announced tax concessions will translate into business growth and greater employment. The cash gained from a lower tax on profits is just as likely, (I would even say more than likely), to simply be siphoned off by shareholders in the form of larger dividends as opposed to providing a cash reserve to hire additional staff. For me, business growth comes from maintaining existing orders and adding new business. Given the global situation, euro zone meltdown etc., it is difficult to see where this business will come from. As well, the announced support for new technologies has about the same relative significance as his money set aside to fill potholes.

Secondly, there are a number of critical issues the Coalition has yet to address. The prime issue, in this context, for me, is the restructuring of the Banking sector. Do you think that the public you say you understand and champion will gleefully accept the return to the bonus culture, perseverance of the casino style system which largely got us into this mess if the forecasted 2% growth rate is achieved? If Project Merlin is any indication, the Tory coalition will have much to answer for.

You must also consider that other proposed Tory Coalition policies, such as the NHS and local government restructuring, among others, may not be the howling success the Tories claim, The Big Society is a joke. The pain caused to a great many of the public will not soon be forgotten

As for Labour, is it a matter of Mea Culpa or explanation of their actions? I think a bit of both. I believe that much of Labours economic spend did much to dampen the worst effects of the Global recession in the UK. On the other hand, the invasion of Iraq and Afghanistan were, for me, a needless drain of human lives and financial resources.