Tuesday, October 04, 2011

Cutting Precisely the Wrong Amount

The UK has major economic problems. That's not exactly news. We have a very large and growing debt, with ever-growing interest payments that need to be made. We also have a very nasty deficit - we're collectively spending more money than we're bringing in.

So, those bright sparks in the government have hit on a solution. They've decided that the way to improve things is to cut everything in sight. Every department will take a cut, loads of jobs will be cut, services will be cut. That way, we'll spend less money, and everything will be well.

Well, fair enough, I suppose. Of course, it will be absolutely awful for people who rely on those departments, and jobs, and services, but the truth is that we just can't afford them. And if it fixes the long-term problem...

Well, except...

It turns out that the cuts aren't reducing the debt, which we knew, but they aren't even reducing the deficit. All they done is reduced the rate at which the deficit is increasing. The problem is getting worse, just slightly more slowly than before. (We're still heading over a cliff, and can't steer away. Rather than actually use the brakes, they've just eased off on the accelerator a bit.)

In other words, our oh-so-wonderful government has managed to hit on precisely the wrong level of cuts to impose. They've managed to make life much harder for a great many people, without actually doing anything to fix the problems.


Either cut enough to actually fix the problem or, if that is judged too painful (since people do, after all have to live here), then cut nothing and just content yourselves with whatever minor efficiency savings you can make.

But cutting just enough to really hurt people, and make them really hate you, without actually doing anything to fix the problem? That's utter madness.

#28: "Pathfinder: Night of Frozen Shadows", by Greg A. Vaughan

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