Generations will look back at yesterday’s budget disaster as the tipping point. A Conservative party that ostensibly believes in fairness, capitalism and libertarian values has all but abandoned those principles in favour of state-sponsored redistribution and socialism.
Debt targets have been all but abandoned. Debt to GDP ratios will not start to decrease until 2015 and total debt will continue to grow until 2017 / 2018 at the earliest. Even these dire forecasts are based on the unrealistic assumption of growth returning to trend and inflation staying in the sweet spot of 2-3%.
There was no supply-side reform, none of the much needed cuts to current spending, including the vast welfare budget, foreign aid or the NHS. Public sector workers will continue to receive pay of up to 20% higher than the private sector, along with gold-plated, guaranteed pensions.
Osborne’s scheme to prop up the housing bubble by providing taxpayer funded interest free loans of 20% to house buyers anything the Socialist Workers party could have dreamed up.
Has he learned nothing from the sub prime crash. He’s going against everything that the conservatives used to stand for. Instead of reducing people’s dependency on the state he’s now nationalising mortgages too.
The pain of these decisions in this budget disaster will haunt the UK for many many years to come. Osborne has taken a further step to mortgaging the future of the country and committing a further generation to borrow and spend what they don’t have.
To make housing more accessible requires a massive house-building programme, something the private sector would leap to without a single penny of government money if only planning rules were relaxed and land made available. But nothing was done on this front. Instead more people will chase the same number of houses, propping up the housing bubble and further haunting those who are awaiting housing prices to drop so they can buy their first home.
Before yesterday it was hard to see how Osborne could get worse, but he’s managed it. Osborne, Ed Balls and Gordon Brown are all the same person I think.