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Well the whole thing grinds on but there are some interesting straws in the wind which I am sure will pass the bovine electorate and Nick Clegg by completely. In this morning’s Telegraph was an interesting article on “Sovereign Debt” and the potential threat of it bringing about another financial crisis, worth a look: “Sovereign debt tops IMF worries”

http://www.telegraph.co.uk/finance/economics/7611787/Sovereign-debt-tops-IMF-worries.html

I have written before that this election should be seen by the electorate as less as a matter of “Politics” and more “Economics” and this does give rise to some interesting thoughts concerning the immediate future for us in these British Isles. Now whilst addmittedly “speculative” by nature as with any ‘crystal ball gazing’, I thought I might share my thoughts.

The Background as I See It

It is too early to write the history of these past 13 years but, I suspect that the disproportionate outcry last year over MP’s Expenses rested on two things that grew directly out of the Labour years and Brown’s pompous boast that he had ended boom & bust in the UK Economy. Firstly the public had to wake up to the fact that the party was over, big time and the economic cycle had come full circle again as it does. In addition, through far too much “Rights Legislation”, the public have a deep seated sense of “entitlement” over just about everything and in part, the anger about MPs was that they “were getting something we aren’t…”

This is not far fetched, I have spoken to a number of people recently on my morning bike rides during this election and one even had a ‘grievence’ about a neice who works in a Bank and got paid a bonus ! I am rarely surprised with the oddity of human behaviour at my time of life and in such matters, hold to what I have always believed in that there is little point in “counting other people’s money”, it isn’t yours so why bother ? For that matter, why resent other people earning more than you, surely if such things matter to you, work out how to improve your own earnings ?

Whilst it would not apply to everyone in the UK, there seems a large and vocal proportion who have become increasingly infantile in their attitudes and childishly selfish. I have seen “Old Time Socialists” blame this on Thatcher’s years and policies but this is clearly a nonsense, she has been gone from Office for 20 years and we have had 13 years of Labour since which through unaffordable Benefits and Targets has created this “Me,me, culture”. People who are in the 20-30 age group would not have been aware of anything but a Labour Government during their lives.

The Sleep Walkers

It is against this background that a minority of sleep walking people could swing the election and deliver a hung parliament with a minority government. The question is: “Would this be a disaster ?”

In the short term and economically, very likely as Sterling would likely go into free fall and inflation would sooner rather than later, rear its ugly head and become a problem again. There would be substantial job losses right across the “Service Industries” and worse of all, there could be a substantial contraction of business in the High Street. But if that was the result of a “wrong decision” = Hung Parliament, would the “right decision” a majority government whether Labour or Conservative, fare any better ? This is a really interesting question.

Majority + Double Dip Crisis

Even with a majority government, the threat from abroad is still substantial and most importantly, completely outside of British Government control because Sterling is a ‘floating’ currency. Would being part of the Eurozone be better ? Hardly and as things stand currently with our indebtedness, it could be worse, a lot worse, more in line with the Irish Republic and the really painful cuts they have had to make.

There are numerous ‘problems’ not least of which is that the whole of the EU cannot compete with China and the Far East on labour/unit of production costs plus, it would appear, lots of the EU Banks with the exception of Spain and the UK, have yet to “fess up” over their real losses so a double dip economic crisis in Europe, is a strong possibility with Sterling leading the charge.

The Real Problem

Many years ago when I wore younger men’s clothes, I was at a reception where there was a member of the Communist Chinese Embassy (then type reference). At that time China had suffered a number of natural disasters and famine threatened and I was talking to him about ‘possible solutions’ based upon the “geographical zoning and mechanisation” of food production.

He was very kind and explained the technical problems of ‘mechanising’ Rice planting and harvesting which is the staple diet in the Far Eat but his ‘killer blow’ which I later came to understand was very simple: “ But what do we do with the people ?”Oddly perhaps and across the decades these words when China is the industrial powerhouse of the World, this question rings loudly for the West because we now need a new economy built upon ‘craft’ rather than volume production. Mind you, we also need to destroy our own arrogance and sense of ‘entitlement’ too so how ?

Creative Destruction

The very essence of Capitalism is its ‘creative destruction’ of the old in order to replace it with the new. The West, even the United States, have sought through copious and pointless legislation, to ‘tame the Tiger’ within the whole concept. Within the United Kingdom we need to ‘exorcise’ the spirit of lazy and stupid ‘entitlement’ and what better method than through the “suicide of the greedy and stupid” ?

Perhaps the best remedy by far is for the Lemmings to vote for Clegg and a “Hung Parliament” because it is only by them experiencing the consequences of their complacency that the British people will accept the changes that need to happen within the economy. Roll on May 7^th and all that it will bring if the Turkeys vote for Christmas !