sally cinnamon wrote:
Whether you agree with the ideology or not, the private sector bosses argue for austerity on the grounds that it will help lead to 'private sector led growth', which is what the Conservative party also think, they have got a Conservative party elected into government and they are doing their bit to put that ideology forwards.....so now the private sector bosses have to step up to the plate and deliver it.
I don't think that is strictly true. I think there are plenty of bosses who realise the state has a role in the economy. What some of them want to be is the provider of services and goods on behalf of the state. So with the NHS they want the state to pay i.e. use our taxes to pay them to provide the service. It is the same in things like education, transport - you name it.
Now if the government stops spending on these things then the private sector overall will contract and won't create any jobs.
So where Hauge is talking rubbish is that the implication of what he says is the private sector that is not involved in any government funded work is the part of the private sector that can and should be working harder to fill the gap. There is not necessarily any demand out there for them to increase their output. It can't be the private sector that supplies the government that works harder because the government is cutting back on expenditure.
Or put another way our resident Tory, Robinson, is being expected by Hague to sell more houses so he needs to take on more staff to do so but like a lot of private enterprises I doubt he is in a position to do this to any great degree if at all given the state of the economy.
Hague can tell the banks to lend and he can cut corporation tax and then sit back and say "There I have created the conditions for growth" but given the economic uncertainties at the moment it is hardly surprising companies are protecting their shareholders wealth by being completely risk averse and are so doing basically nothing.
