The last thing I expected when I wrote the previous post condemning the cutting, indeed abandonment, of USAid by the amoral/immoral President Trump, was that i would have to follow it with a similar article on a similar decision bu what i had supposed was a relatively moral and upright British Labour Government.
A previous post, written five months ago . . .
https://keynesianliberal.blogspot.com/2024/10/
. . .details the fifty year struggle for the British government to fulfil its promised, made by Conservative government under Ted heath, to devote 1% of our massive GDP to aid the development of the world's poorest countries. The goal (now interpreted as 0.7% of GDP for official aid and the rest made up by private aid and charities) was not reached until 2013, again under a Conservative Government, with David Cameron as Prime Minister, probably on the insistence of the Liberal Democrats in the Coalition.
Mr Cameron's words are wroth quoting again:
"The UK will not balance its books on the backs of the poorest.” (27th may, 2011)
And a year later resolved:
“The argument of the heart is even when things are difficult at home we should fulfil our moral obligations to the poorest of the world. There are still more than a billion people living on a dollar a day,”
Sadly his successor, Boris Johnson, was not so high minded, and under him the aid was cut to 0.5%
The previous post referenced above, calls upon the Labour government to demonstrate its moral compass by restoring the 0.7% level.
I find it incredible that the government has done the reverse, and cut the level to 0.3%. Since half of this is now used in the UK to house asylum seekers, the effective amount going overseas is a mere 0.15%.
And our national income is now about four times what it was when the promise of 0.7% was originally made.
Of course, there is a credible case for the UK and other -European counties to increase our defence expenditure now that the US's military commitment has become less reliable. And in the UK there are few if any , other areas of public expenditure that can be cut - indeed the reverse.
So why not higher taxes?
Even died-in-the-wool Tories can hardly object to paying a fair whack fro our defence, And given that the government has a manifesto pledge not to further tax current economic activities (incomes, VAT and NICs) there are plenty of taxes (on inheritance, capital gains,other forms of unearned income , pension contritions, land, wealth. .) available which the largely comfortably-off can well afford.
Rather than ask the worlds poorest to foot the bill.
Shame on you, Labour.
And in the UK there are few if any , other areas of public expenditure that can be cut - indeed the reverse.
ReplyDeleteOf course there are. There’s the massive welfare bill, for a start. Getting a lot stricter on out-of-work benefits — making it clear that anyone who physically can work, must, or starve — would be a good step towards balancing the books.
So why not higher taxes?
Because higher taxes are a false economy. They make us poorer in the long run (actually more like the medium run, in general, and in a situation like where we find ourselves now where we are constantly on the brink of recession, more like the short run) and therefore would mean that we had to spend an even bigger proportion of GDP on defence to maintain the same real-terms effect, and therefore require even higher taxes, making us even poorer, leading to a vicious circle of decline.
Still, given this government has accelerated decline more quickly than even I feared, it seems inevitable we will have a recession if not this year then then next, meaning Rachael from Accounts will be forced to increase taxes further to stay within her fiscal rules, at least we can be sure they will be kicked out at the next election — albeit having done a lot of damage to the country in the meantime.