When Labour took over our country it was drifting into Surplus, simplistically we had more money in Tax than we were spending (A few bob in the bank) this was from exports, banking and Tax.
Sadly over the last 10 years Labour allowed our manufacturing sector to shrink. Remember: Rover cars, LDV,HP, GEC, Metro Cammell, all producing export cash even Jaguar came under threat.
Consequently the revenue (tax) from this sector also shrank, a secondary knock on effect was as these companies closed, money was removed from the local areas, Shops, News agents etc compounding the problems to come.
One of the last areas of private business left was the Banking sector, this still generated considerable revenue (tax) for the government based on its foreign trade.
Britain Banks trade all over the world, the money they make in interest we tax and spend here in the UK.
During the last Government (Our financial Policemen), people like Brown & Balls were advocates of a “Light touch“ approach to the banks, allowing them to grow and grow they did producing lots of revenue (tax) this allowed the government to increase the size of the public sector, transferring private sector jobs to the public sector.
But a big problem was looming, the banking sectors economy grew to be 4.5 times bigger than the real economy, but Labour were still happy because the revenue (tax) continued going up hiding from the people structural problems within our economy, so we all carried on spending.
Then “bang” what started as a crisis with a loan company in the USA started the dominoes falling. Bank money dried up. , Revenue (tax) from the banks collapsed;
we were now spending more than we earn (Big Style).
Labours answer, called quantitive easing another name for “Let’s print some money” was very risky simply put “The more money in circulation the lower its value on the international markets” were we buy our food & fuel, hence inflation.
What have we inherited?
Massive costs (With the biggest Public sector this countries ever had)
Little income (Private sector weak or gone)
Inflation
Local shop closures over the last 4 years, with cardboard fronts pasted over windows.
To those of you old enough to remember this is not déjà vu but almost a re-run of 1978
when almost the same thing happened the last time they was in power.
You can take a horse to water, but you can’t make it drink !!!
Oh’ and I forgot to mention, they say it’s all our fault
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