VAT Cuts

Gordon Brown has decided to drop VAT to 15%.
He wants you to spend your money to help get his badly situated economy out of the mire.
How? Haven't we all borrowed to excess in the last decade and run up enough debt?
2.5% Vat cut. Big deal. Food, children's clothes, books, newspapers etc are mostly exempt or zero rated. You will only save a little on the Fuel bills you pay. Now has anyone noticed the catch? Unless you spend a vast amount, ie you have money to spare, you will benefit, but if you have little money to spare, your Xmas presents will cost a little less, but will you be tempted to spend?
The aim is to stimulate the economy just enough to keep us all employed and paying tax.
Well it's Tax what will go up when he decides to up the VAT again and then repay the GBP12 billion he would have to borrow extra, to pay for the initial VAT drop.
Gordon then gets a double whammy of tax. Your Income tax will have risen and the VAT is up to boot.

Well it seems the plebeian majority are finally listening to their conscience.
They now seem worried the economy may actually already be up "Canal De Merde" and don't want to get their hands dirty on the smelly end of the paddle. They are starting to save their money. Sorry Gordon. Not quite what you envisaged.

As the numpty Mr Darling has already borrowed GBP 70+Billion to prop up the banks and the salaries of the incompetents,spin doctors and the muppets of the Department of Stupidity and Red Tape, I can only envisage a massive rise in income tax. Next year he intends to borrow a further GBP110 Billion. He will do this by issuing Government Bonds and Securities and pay interest to the people who take up these issues. It will mean that he will be taxing you to pay for the interest payments to the pay back to the Bond holders, or he will forever be issuing new bonds to cover the old.

What a prudent Chancellor should have done Gordon, would be to save some funds. Put it away for a rainy day. But he didn't. Well the rainy day is the global recession brought about due to Sub Prime greedy bankers, who lost the plot and forgot that some people just cant afford houses.
Now they have no interest from the mortgagees to pay on to the bond holders of the bonds the bankers issued, to get more money to lend to more poor people to buy more houses.
It's a vicious circle.

The Bankers forgot what would happen if people couldn't repay the initial interest. People/Pension Plans/Other Banks pull out of the bond, eventually causing panic and creating a run on the banks. That's why the governments of Europe and the USA are guaranteeing banks now, as they cant afford to have a recession like the 1930's.

The UK Government are so desperate that interest rates could soon be cut to zero. Then there will be competition to sell goods as shop keepers try to tempt custom just to stay afloat. People will always hold off for a better price, and this creates negative inflation ie things get progressively cheaper, in the fight for custom. This will mean that the global economy actually will be like it was in the 1930's, the thing they are trying to avoid.

The UK isn't in the best position to prevent this. It's Government has borrowed way to much in the past. It is suffering from already low interest rates. It has said it will increase it's big projects to stimulate jobs, and will spend its way out of the recession. Well it's hands are tied as the normal tools to cut a recession are to cut interest rates, and borrow to spend on economic projects. As I say, it has to issue Government bonds to pay for this. It has technically borrowed so much, and has had to prop up the banks it cant let fail, I cant see who the hell can afford to buy these bonds. The interest rates on these bonds will probably be better than you or I can get for our cash sitting in our current and deposit accounts in our banks.

If it was yours or my company that was doing the same, we would already be bankrupt and living in a cardboard box under Blackfriars Bridge.

Somewhere along the line someone will realise that you cant spend what you haven't got.
We will then be stuffed with increasing interest rates to prevent spending, and higher taxes to balance the books and then it will all come around again in another 30 odd years.

TAXATION WASTE - BORROW AND SPEND OUR WAY OUT OF RECESSION.

As you can probably tell from previous rants at the world, I live in the United Kingdom.
You ride to work thinking happy thoughts, but then you see the budget list in the papers and the taxation we pay, and how we waste it.

Yep, Mr Brown that staunch Labourite conservative has done it again.
He has decided to punish the middle ground people yet again with homes and mortgages, and children and who pay their taxes.
Hey we aren't all millionaires in the UK. We need to be though, just to pay the duty on Beer and Petrol.

Lets look at some facts. The lower income families used to pay a lower tax rate of 10%.
This was to help them rise out of an ever increasing poverty trap due to increasing inflation pushing bills higher than their earnings.
Now its been abolished and they must pay a straight 20% thus they pay more tax.
Now Mr Brown and his puppet Mr Darling have decided not to close the loop hole where the super rich investment banker types of the country only pay 10% on all their income.
Yes it is a lower % than their cleaners pay! Farce coming to mind yet?

Surely this smacks of hypocrisy.
The Labour party aim was from when it was founded, to protect the rights of the lower classes and go at the rich to even things out a bit.
Well you aren't doing that anymore.
The lower to middle classes are stuck between the two.
We are lower to middle class because we have pride to get up and get a job to support our families.

WE DON'T LAY ABOUT WATCHING RICHARD AND JUDY ON TV ALL DAY, WAITING FOR THE TIME OUR NEXT BENEFIT IS PAID. IT WAS NEVER EARNED, BECAUSE YOU NEVER PAID INTO THE SYSTEM IN THE FIRST PLACE!

Why do we pay tax? We pay the tax because it is supposed to benefit man kind ie schools, hospitals, roads, libraries, used to promote protection ie the armed forces and police force, and to provide a little assistance for the deserving who paid in and need help to get back on their feet again ie benefits and assistance for when we are between jobs and can't find work.

The tax was never intended for the log term abuse it suffers from now.
And it is NOT to be used for some idiot politician to install a new kitchen and bathroom in their subsidised second houses, which they can have paid through our tax!

Then we learn that Mr Brown has decided to borrow even more money to spend his way out of the impending recession we are falling into.

Well how about cutting all credit right back?
Cutting all the red tape you installed in the first place?
Stop the waste invading Afghanistan, and especially Iraq which to my mind, and the rest of the world, was illegally entered into by that idiot G.W Bush and his little lap dog Mr Blair.
Start taxing the super rich. If this country is so great, which it was before Labour was elected, the rich will stay here.
Making the rich pay 20 & 40% like the rest of us is only fair.
And don't even think about borrowing more cash from the world markets on behalf of HM Government.

It will be us in the middle that will be taxed even harder to pay it back!