Saturday, 2 June 2012

More Blood Letting Mr Osbourne

If we did not need more evidence that the Conservative governments economic strategy has proved to be wrong, the latest manufacturing output figures confirm the worst slump in three years.

Chris Williamson, chief economist at Markit, said: "The data indicates that the sector is contracting at a quarterly rate of around 1%, suggesting that manufacturing will act as a major drag on economic growth in the second quarter.

Markit economist Rob Dobson said the weakness of UK manufacturing was in large part due to domestic demand.

Mr Osbourne has presided over a double dip recession, this recession was designed by No.11 Downing Street, stripping demand out of the economy by cuts in public spending, he has destroyed confidence in consumers and he increased taxation/reduced tax credits on ordinary people, taking more demand out of the economy.

If this austerity programme had seen a large fall in the deficit with improved manufacturing output with an increase in full time jobs this could justify the cuts, but the reverse has been the result, with short time work, falling manufacturing output and an additional £158billion of borrowing.

It is clear the Conservative government needs to increase demand in the economy, this by building houses, investing in industry, through using the RBS as an investment Bank, time limited tax cuts, like VAT and in the longer term the introduction of a financial transaction tax, we have to move away from making money from leveraging money to producting wealth for the many.

Mr Osbourne your blood letting has caused a double dip recession, we cannot afford more blood letting. The choice is between decades of stagnation or improved living standards.

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