Given that it will take a year or two, if not a decade or two, to bring society round to the view that full employment can be achieved by more sharing rather than more growth, and to avoid yet another lost generation (though given the current rioting it may already be too late) here is an an alternative to the present destructive and misguided austerity measures.
Cut government spending by:
. Abandoning Trident and its replacement;
. Pulling out of Iraq, Afghanistan and Libya with all possible speed;
. Replacing the pensioners' free bus pass with a token payment of, say 30p per journey. (The same could apply to the free bus travel for youngsters in London.)
. Discontinuing the pensioners' winter heating allowance.
Increase the governments' (and local authorities')income by:
. Introducing the 50% tax rate at £100 000 rather than £150 000 per year, with proposals to tax households rather than individuals in future;
. Ending the exemption from capital gains tax on increases in the value of "principal private residences." We need to see houses as machines for living in rather than ways of making money.
. At least three higher bands on the council tax so that mansions pay their whack. (This would be an interim measure as we prepare to switch to land taxation.)
Direct the public resource released and gained by:
. Increasing all welfare payments and the retirement pension by, say 10%. This will help alleviate some of the real pain, and the money is likely to be spent in our own economy and thus create demand rather than leak out in a new foreign car or exotic holiday.
. Restore most of the cuts in the public services. HMRC clearly needs more staff to bring in the existing taxes due but uncollected, and current events show we could do with more, not fewer, police. The cuts to the BBC, and especially the World Service, are a particular piece of vandalism.
. Restore most of the cuts to the arts and charities. The arts are not only a jewel of a civilised society but also a nice little foreign currency earner (one of the areas in which Britain really still is a world leader.) The more useful charities, which already form the "Big Society," cannot do their work properly without public funding.
. Lift restrictions on foreign students. Higher education is another area in which Britain is still a world leader and, as well as generating good will towards this county, is another nice little earner.
. Have a house building drive on brown-field sites to create mixed housing areas, both social and private.
. Massive public investment in developing green energy sources and "greening" the infrastructure.
Politics and Economics.
. Discontinue Quantitative Easing. This is an inefficient way of creating demand as the government has no control over how the extra money will be used. So far the banks have used it to shore up their own balance sheets and much of it has gone into assets rather than useful and employment creating enterprises. Even the existing QE is likely to generate unwelcome inflation once the economy recovers.
. Charge the two largely state-owned banks with the duty, not of maiximising the return to shareholders, but of providing long-term investment funds to industry and commerce, especially small and medium sized enterprises, at low rates of interest (on the German model.)
. Stop comparing ourselves with Greece