Stop Pussyfooting Around PM !

  oresome 14:11 16 Aug 2012

Boris Johnson has been beating his chest following a successful Olympics.

Rather than reining in expenditure, he wants the government to be bold and instigate some large infrastructure projects to kick start the economy.

We haven't really started reducing our over expenditure yet as what cutbacks are being made are matched by falling tax receipts.

So is Boris right? Should we forget the deficit reduction for now and get the economy moving again?

  carver 14:17 16 Aug 2012

There is the school of thought that unless you get people working and producing then the economy will not grow and at the moment nobody is wanting to spend any money that they may have.

The biggest problem at the moment is that the banks are sitting on our money and don't want to lend it to any one other than give themselves bonuses.

  interzone55 14:20 16 Aug 2012

As much as I hate to say this, I agree with Boris.

We need to create jobs, which will have the dual benefit of cutting benefits payments and increase tax receipts.

  Condom 14:33 16 Aug 2012

Please let us be very clear what Boris was suggesting the PM does. He is talking about London and not the rest of the country. London is a pretty successful city and it has had more than enough large projects for the present time. It is time for infrastructure to be upgraded elsewhere so I do hope his calls go unheeded for the moment.

  morddwyd 21:26 16 Aug 2012

"So is Boris right?"

Of course he's right.

Doesn't matter what he said, or the end result, it's got people talking about him again, and that, as a politician, is his lifeblood.

  Forum Editor 23:16 16 Aug 2012

Keynesian economic theory says that when times are hard the government can boost the economy by embarking on a series of big public expenditure projects - building roads, dams, airports, that kind of thing.

The idea is that these projects create wealth - large numbers of people are employed, and they have to be paid. They spend their wages in shops, so the retail sector gets a boost. That creates more demand for goods, so the manufacturing sector gets more orders. All that activity means an increased level of tax revenue for the exchequer, which in turn enables the government to spend on more projects, and so it goes on.

That's an over-simplified explanation of the concept, but it will suffice. Boris is suggesting that it might be the way to go in terms of making people feel better, and he's probably right in that respect.

Interestingly enough, there are signs that the official doom and gloom news about the economy may not be entirely accurate. There was a 40,000 drop in the number of people who are unemployed in the three months up to June, and that means companies are hiring. if that's happening there must be a reason, and it can only be that some employers are gearing up for more business.

  zzzz999 03:07 17 Aug 2012

Forum Editor much of that increase in employment was part time staff. In addition, there has been increases in people on full time employment having their hours reduced. We need to seriously kick start the economy, Osborne's austerity plan has not worked, very much like Thatcher's monetary policy theory it has resulted in the UK being in a deeper recession, longer.

  oresome 09:17 17 Aug 2012

So much for the theory, FE.

The question is, is Boris right?

If he is, Brown was right all along when he said at election time that applying the brakes too hard would drive us deeper into recession.

  Forum Editor 09:20 17 Aug 2012


"Brown was right all along when he said at election time that applying the brakes too hard would drive us deeper into recession."

I was never much of a fan of Gordon Brown, but yes, I believe he was right on that subject.

  KRONOS the First 09:44 17 Aug 2012

Unemployment began to level off towards the end of 2011, and the beginning of 2012 saw the first fall in almost a year. The overall number of people in employment has been going up, as has the number working in the private sector.

For some this is a positive sign of economic recovery. For others it is tied to the higher numbers of people working part-time, with record numbers only doing so because they cannot find a full-time job.

  interzone55 10:33 17 Aug 2012

I think we also have to ensure that any projects that are carried out, are required and suitable, so we don't end up like Spain with a disused airport, and ghost towns; and China with empty towns, theme parks and shopping centres

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