Leading economists back the Conservative party plan on spending cuts
A number of leading economists in the UK have stepped forward to back the Conservative party's plan to cut public spending and try to realign UK finances. Despite the fact that the economists in question have no political motivation behind their stance it has obviously caused upset in government circles as it does criticise the Labour Party's proposals to cut the UK budget deficit. Is this a killer blow for the Labour Party?
There is no doubt that the Labour Party is unable or unwilling to change its current stance on public sector spending and the budget deficit. Gordon Brown firmly believes, and has always believed, that due to the fragile nature of the UK economic upturn there is still a need to invest significant money in the short to medium term. On the other hand, the Conservative party believes that further investment in the public sector (funded by further debt) will harm the UK economy in the medium to longer term and a reduction in spending is required immediately along with a potential realignment of the tax rates in the UK.
Whatever happens and whichever party gains power at the next election there is no doubt that tax income for the UK government needs to rise in the short to medium term. In reality we also need to see a reduction in public sector spending which continues to rise even though UK debt is quoted at well over £1 trillion and the UK budget deficit will be over £170 million for the current tax year.
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