It is important to understand what is leading this economic downturn. Its driving force is a collapse in private investment in the US and all major economies.
I\’m not sure that I agree but what do you propose to do about the problem you have identified?
Introduction of a more progressive system of taxation
Lessee, the wealthier you are the lower your marginal propensity to consume and the higher your marginal propensity to save. As we\’re not Post-Keynesians around here, higher savings lead to greater investment. Taxing those high income earners more will, therefore, lead to lower savings and less investment.
So, Ken Livingstone\’s answer to a fall in private investment is to insist that in future there should be less private investment.
Sounds like a plan really, don\’t it?