Thursday, 14 October 2010

Still the Old Politics

What I believe to be the true condition of the British Economy was aptly summed up by a Professor Kushmer in a letter to the Guardian on 11th October. He wrote:

"There is no formal opposition to the flawed political narrative - that we are in economic crisis and in need of deep fiscal surgery...Forget that economists from Martin Wolf to David Blanchflower, from Will Hutton to Jospeph Stigliz oppose it - and that "the markets" are not calling for it. Forget that our debt- to- GDP level is historically low, that our tax is among the lowest of the OECD and that the calculation of the "fiscal deficit" is crafted, not magically given."

Yet again and again the coalition government justifies the abandonment of election promises with the flawed excuse of the "financial mess left by Labour." I have not read Vince Cable's speech to parliament on the raising of student tuition fees, but the clips I saw on television concluded with a robust jibe against the "party opposite" (and a pat on the back from David Cameron), as though alleged problems relating to tuition fees had not been raised before "the current appalling financial situation...which we inherited" became evident.

Clever lines about the road to Westminster being "littered with the skidmarks of political parties changing direction" may go down well in a debating chamber, but they merely reinforce the cynicism of the electorate and give substance to the view that politicians and parties are are all alike and none is to be trusted. The government should remember that their most urgent task is to restore respect for the democratic political process, and parliamentary knockabout and distortions of the truth are not the way to do it.

Equally Labour express indignation about the substance of Lord Browne's review , conveniently forgetting that it was they t first introduced tuition fees and they who appointed the Browne commission to review the situation. They have as yet expressed no clear alternative to the Browne proposals. Their leader supports a graduate tax but it is far from clear what the party's official policy is.

If we could afford free university tuition until 12 years ago, and France and Germany can each provide it for the equivalent of £160 and £845 per year respectively, I cannot see why we now need to charge around £7 000 a year. I believe there is no need for any tuition fees at all. This is perfectly feasible. As Sally Hunt of the University and Colleges Union points out (Guardian 12th October 2010) "(a) very modest increase in the UK's corporation tax rates to the G7 average would raise enough revenue to abolish tuition fees."

However, although there are problems with a graduate tax, as I acknowledge in an earlier post, I think it would be a perfectly acceptable for middle and high earing graduates to be required to pay a token extra tax, say 1%, in recognition of the benefits they have received.

2 comments:

  1. The Coalition has missed the bus.....what is the single most important action that should have been taken to get things back on course while avoiding striking workers & bad feelings ?? posted by ALLAN MARRIOTT 15/10/10

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  2. Glad you've found out how to comment, Allan.In my view, we should forget about cuts and invest heavily in "green energy," the infrastructure, and eduction at all levels, including HE,thus promoting economic activity, improving the tax take and reducing the budget deficit in a positive manner.

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