Monday, 25 February 2013

David Cameron begs in India and in China

David Cameron begs in India and in China

The Conservative strategy is brilliant. They destroyed car manufacturing in the UK,  exported jobs to India and China, used India and China as contemporary sweat shops and flooded the British market with cheap goods and now they are reduced to begging India and China when Britain’s credit rating is downgraded and the deficit keeps growing.

The Conservative Party was usually known as the Nasty Party. Well, the Conservative Party should be renamed as the Irrational Party. Britain is borrowing money to then send billions of Pounds to Europe and losing investors’ trust in the process. Now they want to redirect funds used as foreign aid to patch up the ailing defence budget. Let us remember the early actions of a Defence Secretary that did not seem to be very clever. Mr. Fox ordered the dismantling of Nimrod airplanes that were ready to enter active service and had already been paid for. Billions of Pounds were lost and they called it ‘efficiency’.

The government talks about a strong Foreign Policy and we were left without a naval task force for the next ten years. Again, this was another example of efficiency that does not surprise us. We do remember the then Health Secretary Virginia Bottomley when she implemented the closure of psychiatric care units and left people affected by mental problems – including British veterans - sleeping rough in the cold. That was also called ‘efficiency’.

The government printed billions of Pounds (Quantitative Easing) and doing so devalued the Pound. If they were going to devalue the Pound, rather than giving the money to the banks they should have invested resources in the British economy instead of forcing people, who were already facing difficult situations, over the edge.

The downgrading of British credit rating – as it happened in Greece and Italy – will lead to higher interest rates to be paid for the moneys the state is borrowing in the open markets. It could also send the Pound in a downwards spiral pushing up relative energy prices. We are going to pay more and more for the oil and gas that we are going to be forced to buy using an increasingly worthless currency. This is having a direct effect pushing up the prices at the shops. With less disposable income, British families have only two choices: they either spend less depriving themselves of items considered essential or they are going to have to increase private borrowing using credit cards and loans. This is extremely worrying when many have already reached their credit limit and in desperation are having to use loan sharks that lend money charging extortionate interest rates.

The Labour government promoted inflation to create an illusion of prosperity. House prices went up and they made many believe that they were richer simply because of the equity in their homes. The labour of destruction of the British economy has been a shared effort in which both Labour and Conservatives have implemented ruinous policies. They say that ordinary Britons are no longer saving. Saving what? The currency has been devalued, their income has fallen and they are saddled with debts that they cannot afford to repay.

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