Although trashing the economy (and future wealth creation prospects of the electorate) is a long term speciality of successive governments, this particular elephant in the room appears to be getting scant attention during the UKIP leadership race. Although somewhat esoteric and boring, can we really ignore the political establishment’s scrapheap economics – used and abused today and discarded to a life of semi or real poverty without prospects of upwards social mobility tomorrow? Sooner or later the next recession or worse, depression, will arrive to ram home, through unnecessary and largely preventable hardship, our political class’s failures.
The ways to trash the economy can be simply categorised as:
- Undermining the productive or wealth creating part of the economy, typically:
- Piling on misconceived legislation and regulation, and unnecessary bureaucracy;
- Draining financial resources from businesses, their customers and investors – research, development, training and productivity improvement are all costly;
- Delivering an increasingly poorly educated, unskilled and de-motivated workforce (particularly amongst the young) unable to work in high-value adding jobs;
- Encouraging negativity towards enterprise and trashing supportive British culture.
- Burdening the economy with wealth destroying activities and costs, typically:
- Growing an unsustainable Public Sector, Deficit and National Debt;
- Growing a dependency culture based on government largesse;
- Growing future obligations and liabilities, e.g, Public Sector pensions, Private Finance Initiatives, costs of mass immigration on security, policing, infrastructure, benefits.
- Manipulating parts of the economy with harmful side-effects, typically:
- Concealed mismanagement e.g, abnormally low-interest rates, escalating consumer debt and low personal savings, unaffordable housing, high energy costs;
- Keeping wages low e.g, facilitating mass unskilled migration and in-work benefits;
- Facilitating productive jobs moving overseas e.g, EU grants, foreign takeovers;
- Supporting costly ‘vanity’ projects e.g, HS2 or new Chinese nuclear power stations.
Successive governments of TINOs (Tories in Name Only), Labour (Champagne Socialists) and Lib Dems (PC and EU fanatics), and the European Union through their actions have created a ‘smoke and mirrors’ low wage, low productivity, increasingly uncompetitive economy hiding serious structural problems; for example: Public Sector and consumer spending being unsustainably large, investment typically on research is too low.
Their game does not create new wealth. Instead, it redistributes existing wealth to their chosen, usually undeserving, privileged beneficiaries and destroys future wealth creating potential. For every winner there are losers, often the more vulnerable in our society, be they small, innovative businesses, scrap-heaped communities, or the old or the poorly educated and largely unskilled. We and future generations are being robbed. For example, The TaxPayers Alliance calculates that if government spending had stayed at 31.7% of GDP the average household would be £27000 per year better off. And if they had not introduced other economy-trashing policies we would all be even better off.
Scrapheap economics is the natural outcome of (irresponsible) short-termism and expediency; ill-conceived ideology (Big Government knows best, social engineering etc.); ignorance and incompetence; dehumanising flesh and blood people into human resources (to be exploited); and a political establishment putting their aims (or self-interest) before the long term interests of the British people. Also, policies across a wide range of government activities have socioeconomic effects and (longer-term) implications for quality of life for the British electorate, their dependants and their descendants. These, if ignored or downplayed, almost inevitably have major (longer-term) scrapheap consequences.
The antidote to scrapheap economics is realistic efforts to create a future-proof economy (whatever happens) to safeguard the future prosperity, well-being, and quality of life of the British people. A start is to reverse the long-standing trend of governments (as shown above) to trash the economy. Being one of the first countries to do this would naturally give us an advantage over competitors.
There is also much subtlety that can be applied to make the country competitive today and tomorrow, and a truly wonderful place to live that is low or no cost. Brexit can even help here by releasing us from the European Union’s authoritarian mismanagement and ideological aims (unless the government, true to form, messes up). Just a few examples include:
- Coordination of policies to prioritise the current and future interests of the British people;
- Motivate and educate the next generation to be enterprising, innovative, productive and protectors of the best of British culture and heritage;
- Tax and public procurement to incentivise indigenous innovation and smaller enterprises (the wealth creators of tomorrow) and productivity improvement (to enable higher pay);
- Company and contract law to discourage irresponsible behaviour;
- Abandon the failed and costly experiment of multiculturalism and social engineering;
- Copy and improve on existing best and prudent long term practice.
Our greatest asset in creating a peaceful and prosperous future is all around us in the best of Britishness, the British people, our achievements, heritage, culture, and uniqueness; this is all part of our ‘national intelligence’ which enriches our lives and helps us to be more productive and innovative. Successful innovation needs them because, as stated in the Book of Ecclesiastes, ‘there is nothing new under the sun’, and reiterated by Peter Drucker, the great management guru, based on his experience of working with company executives.
Throughout the United Kingdom are melancholy scrap-heaped communities and people where prosperity once existed, and today hope of a better future is not even a distant dream. Successive governments have failed these flesh and blood people. On current trends, the future for their children and many others will be bleaker still because the ruling establishment has been digging them into a deeper hole. Yet once we recognise and analyse the problems created by the TINOs, Labour and Lib Dems, we can work on the solutions and truly build a better tomorrow.