The Guardian reports:
The CBI is to press for extra infrastructure spending from George Osborne in next month's budget after it cut its forecast for UK growth in 2013.
And I agree.
But let's not get too excited about that, because the CBI wants this to be paid for with more austerity. And that's, very politely, economic madness.
If we want toi get out of recession people need money to spend. And austerity is designed to reduce money available to spend. Infrastructure spending and austerity still guarantee recession.
Infrastructure spending, an aggressive attack on the tax gap and keeping governemtn spending going will deliver results.
The CBI recipe can't.
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“If we want to get out of recession people need money to spend………….an aggressive attack on the tax gap…………..will deliver results”
But won’t aggressively going after tax evasion and avoidance also reduce the amount of money for people to spend? Its foolish to assume that all tax avoided or evaded leaves the UK and never returns, so is not attacking the tax gap also guarranting recession by taking spending out of the economy.
If someone evades £50k in tax but buys a new range rover it is still helping the economy, creating jobs and adding to VAT…..
No, closing the tax gap gives money to the people who have a right to spend it
That’s redistribution, not stopping spending
Very different