As I understand the current economic situation, we’re not part of the Euro so we should be able to ride out it’s demise better than others.
But we have to be able to react to the changes. And that’s where the problem is. Everything is being based around planning and forecasting. As was shown by the collapse of the Soviet state, state planning doesn’t work. So the state is not the one to do the reacting to the changes that are coming.
Nor is the state the one to go around trying to get the country out of the mess it put it in. Or rather the state is not the one to get the country out of the mess Gordon Brown and now George Osborne have put it in. If the state thought they were doing the right thing when in actual fact they nearly destroyed the country then it really isn’t the one to fix the problem.
The government got frit with the banking collapse and gave away loads of money to bail out the banks. They should have done the strong thing and let the banks collapse. A bit of short term pain which in the longer term would be seen as the proper thing to do. But even that short term pain wouldn’t have been that painful with the Financial Services Compensation Scheme (FSCS) that meant that 96% of people’s deposits were covered. Â£35K in a bank account is a huge amount. It is now Â£85K to cover the last few percent to reach 99% of bank deposits. As UKUncut are so keen on the penalising the top percent for the benefit of the majority, then the 4% who would have lost some money if Northern Rock had gone bust should be the ones to make the sacrifice.
The government still have sorted out the mess either. They have forced the banks to start saving for a rainy day. Unfortunately we’re already in the rainy day. So it means that rather than the banks giving out loans to companies who can react to the changing environment, the banks are keeping a lot of money for their emergency funds (as stipulated by the govt).
What should be happening, in my mind at least, is that the banks shouldn’t be forced to save for the rainy day. They should be doing their best to help the economy flow. It’s not like we can go into another recession whilst already in one. So let’s get ourselves out of this one, THEN start saving and putting in checks and balances to ensure that the banks don’t collapse in the future (and also force the govt NOT to bail out banks).