The Leader of the Opposition David Cameron says that if the Conservatives win next year's UK election then they will give priority to reducing government debt over and above tax cuts.
The Tory leader has thereby abandoned his party's previous commitment to "sharing the proceeds of growth" (i.e. he is abandoning the high- risk idea of deficit-financed personal income tax cuts) and signalling instead that a Conservative administration would stop adding to public debt.
http://www.guardian.co.uk/politics/2009/mar/20/david-cameron-conseratives-economic-policy
It is clear than the British right wingers don't want to get into the mess than the Irish conservatives find themselves in.
Charlie McCreevy, Eire's finance minister between 1997 and 2004, used to scorn the old fashion notion that fiscal policy should lean against the business cycle.
While the Labour-Progressive government in New Zealand was running large government surpluses in the face of persistently strong global growth that economists could never adequately explain at the time, Mr McCreevy was in government on the other side of the world implementing what National in New Zealand was demanding for our own country.
"When I have the money, I spend it. When I don't, I don't," McGreevy would say as Ireland cut income taxes and ran "balanced budgets" during the good times which left public finances too dependent on windfall revenues from VAT on new homes, capital-gains tax and stamp duty.
These days those revenues have all dried up as house prices and sales slumped.
The Irish budget is massively in debt today. The Irish Government is about to introduce its fourth fiscal package in a year - the unemployment rate is over 10 per cent and a public wages have been cut 7.5 per cent - but the government is still scrambling with its debt problem created by its own poor, risky fiscal policies.
Next on the agenda for the Irish Conservative Government?
Higher income taxes, wouldn't you know it!
http://www.economist.com/world/europe/displayStory.cfm?story_id=13331143&source=hptextfeature
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