Message to the Fabian Society

As the Fabians say in a pamphlet out this week, societies get the inequality they choose. In 1945, Britain had a national debt of 200 per cent of GDP, compared with 60 per cent now. From that economic disaster rose the NHS and the pledge never again to replicate the mass unemployment of the 1930s.

If you\’re going to make claims about how to get out of a high debt situation like that it\’s worth you actually looking at what happened… get us out of that high debt situation.

The Government ran budget surpluses.

No, really, they did, they cut spending and there were surpluses in 47, 48 and 49.

Now we all know that\’s not the message you want to put across but that is the message you are putting across.


2 thoughts on “Message to the Fabian Society”

  1. I assume that during the war we borrowed money, bought stuff (tanks, planes, ships, ammunition) and destroyed it. The debt remained once the ship was sunk, or ammunition fired off, but there were no running costs involved. So as long as the day to day running costs of the State could be met from taxation revenue, it would be quite feasible to revert to budget surpluses in quick time.

    We however have borrowed money to employ people, and pay more benefits, which are on-going costs. You can’t just stop, unless you make 25% of State employees redundant, and cut benefits similarly.

    We are so screwed.

  2. Not only did those things (tanks, shells, ships etc) not incur running costs, but the state also demobbed large chunks of the armed services (which numbered two to three million if I remembers correctly)*. Sadly they didn’t apply the same degree of demobilisation to the civil service (which had also grown during the war) but I suspect the overall effect, even with the creation of the NHS, was to reduce the cost of government.

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