Sunday, 31 October 2010

A question

I would like someone to answer this question because I cannot for the life of me make it make sense.

1/2 million people - at least - are going to lose their jobs. A high proportion of these will end up on JSA. Which means less money to spend.

Housing benefit is to be cut. This means, at best, more of a householders wages will go towards rent, at worst, they lose their home. This means less money to spend.

ESA and DLA to be cut, leaving those in receipt with less income. This means less money to spend.

VAT to rise. For large corporations, they can afford to swallow the rise and not pass it on to the customer. This is not the case for smaller businesses. They will have to pass the rise on. This at best means fewer customers, at worst, they go out of business. Which means they have less money to spend.

And yet the 'Coalition' expects the economy to grow. Now I'm not an expert by any means but I'm certainly not stupid. Less money = less demand. Prices drop. Retailers compete. Prices drop more. They cut jobs because there is less demand. Less people spending = even less demand.
So how exactly is the economy going to grow? And how is the private sector going to to generate enough jobs to cover those lost in the public sector? Not to mention those on ESA who will be moved onto JSA?

If anyone can explain this to me I'd love to hear from you

1 comment:

  1. very good question, george osbourne for all his acedemic qualifications fails to realise the most basic mistakes he is making.