Monday 13 July 2009

What's important?

Last week I heard a discussion on the radio where a Conservative MP said that "the first priority of government is to sort out the country's finances." It it really? I wondered. What he was referring to was the massive public debts that are being run up by the government to try and dig our way out of this recession (or Moneygeddon, as I like to refer to it) and how to reduce them.

Whilst not denying the importance of economic policy, I'd like to perhaps be a little controversial. I don't think that this is the most important issue facing the government. Or at least, not the most urgent part of that issue.

As a historian, I know there have been many debates over the centuries about what government is 'for' and that views of this have changed. For many centuries, the monarch was the government, and the oath that monarchs took (I have no idea about the modern version) was to protect the church, to do justice, and to protect the laws and customs of the realm. So law making and the workings of the judiciary were a major focus. At other times the defence of the realm and support of the armed forces has been seen as the first duty of government, particularly in war time.

Today there are still different views of the purpose of government- should it be a light or heavy touch, can the market right itself or do government agencies need to intervene? But my view, which I'm not saying is the only 'right' one, is that the government is there to act in the best interests of the people of the country (and, I hope, of the world).

People. That's what should be at the heart of government. Policies and process are there to serve them, not the other way around. So health, education, job creation, surely these should be at the heart of what the government does? And perhaps, if we can follow this through, it might help with the financial problem we started with.

To reduce government debt, either spending has to decrease, or tax revenue has to increase. At present, it seems that most people are agreed that neither of these can happen, at least not by huge amounts. But for the future, one or the other or both will probably have to. Debt isn't good. I don't like the idea of a decrease in government spending. I'm sure there are areas where the same work could be done for less money. But the problem is that when you start cutting down on government 'waste,' most people seem to conveniently forget that this usually means cutting jobs. Often not very highly paid jobs. Which only adds to the problem (saying that paying Jobseekers' is cheaper than paying their salaries doesn't make it right).

So the other area is to increase tax revenue. Again, there are two ways of doing this; to increase the amount each person pays, or to increase the number of people paying it. Given that I'm on a fairly low income, I don't like the sound of the first, at least not as an across-the-board increase, which is bound to hit the lowest paid hardest. Better, it seems to me, to increase the number of people who are eligible to pay tax by increasing the number of people in work. That's one reason why I'm glad the government has at last recognised the problem of youth and graduate unemployment. Education provision is also linked to this, and so is health- a well-skilled and healthy workforce can contribute to the economy more than an unskilled and unhealthy one. This was partly why the post-second world war government introduced the welfare state- to cure the 'social ills' that had been brought to light during the war.

People so often seem to forget the reason taxes exist: to provide services. It's easy to moan about taxes when you're not dependent on the services they provide- if you can afford private healthcare and education, and have savings enough not to have to worry about pensions or benefits.

Of course, I know that this isn't an ideal world, and that the ideal that increasing jobs would solve our financial problems is probably too simplistic to work just like that. But I can't help but think it might help. That perhaps a better way to get out of this slump is to do for our own country what we try to do to help those in the third world: to give people the tools (skills, start-up grants, training and support) to work their way out of dependence, so that they can contribute to the economy.

As I say, that's probably too simplistic. I've never studied economics, or even politics, except where they interact with history. But hey, maybe there's something in it.

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