Gary's News and views

Gary writes a weekly article which appears in the Plympton Plymstock and Ivybridge News in South West Devon. The articles are published here.

 

Thursday 9 September 2010

LIVING ON A KNIFE EDGE
This week I took part in a BBC inspired panel session discussing the forthcoming spending cuts – a handful of you may have watched it. It was useful and enjoyable but what struck me most was just how polarised our society still is, depending on where you are standing. For some people the private sector is still a wholly negative thing. For others the public sector is always inefficient and overmanned. This conflict is unhelpful.
Off camera at the end, one panel member accosted the most successful business man present saying: if business people paid all their taxes we would not have to have so many cuts.  "My company paid £70 million in tax last year – is that enough for you?"came the reply.
The accuser was a kindly person who has worked in the public sector all of his life, never employed anyone, never created wealth, now living on a public sector pension.  The businessman (who I thought was the star of the show) was a person who left school with nothing and now runs one of the biggest businesses in the West Country and employs thousands of people. He has created wealth. His company profits generate the taxes that pay his accuser's pension. Yet the divide was a yawning chasm.
It is time we moved on from this sterile debate. Governments do not create wealth. They spend money that other people create. People who start businesses which employ others are the ones who generate the taxes that employ every single person employed in the public sector, who in turn pay their taxes of course. If there was no private sector the government would not have a penny piece. Every single pound we pay on benefits comes ultimately from funds generated by the private sector.
Equally, we need the public sector to help organise our affairs and help us create a fair and coherent society, including caring for the most vulnerable. We need both. If we are to survive the next tough few years we have to pull together.
Whether or not we head back into recession depends on many things. True, the extent of public sector spending cuts is part of that picture. But whether the US economy grows or contracts is even more important. Whether the euro-zone economies recover or fade is absolutely crucial. I agree with the comment during the panel that our economy is on a knife edge and could go either way.

posted by Gary @ 08:43