The Political Economy Review 2017

past if Brexit is to be a success. And we must be careful not to embrace the failures of the wrong era, and forget the successes of the right one. The economic plan which Jeremy Corbyn proposes would do just that: take us back to the flawed economic system of the 1970’s, and undo the formula of economic prosperity devised during the 1980’s. This would be a fatal mistake, and one which we cannot afford to make. As we leave the European Union, it is of paramount importance that our economy remains healthy and competitive. After all, it is the economy that decides our jobs, aspirations, salaries, healthcare and public services. And we should be worried that neither party currently offers the right plan for it. Theresa May undoubtedly comes closest, yet her manifesto was disappointing to say the least. Declaring war on energy companies and charging firms for immigrant workers indicates she seems to have abandoned conservative principles for a somewhat populist and vote-grabbing agenda. Repeating her mantra of “strong and stable”, and pushing for an aggressive Brexit hardly instills confidence, especially given that May seems to have forgotten completely she used to be on the other side of the Brexit argument. But on the other hand, we have Chairman Corbyn and Comrade McDonnell concocting economically illiterate, albeit lucrative promises, which, if effected, will create devastating economic fallout. They envisage a future through rose-tinted idealistic glasses. Free tuition for all, a plan to transform our NHS into an ‘NCS’ (a National Care Service), State-Owned Railways where gleaming trains all run on time, better school funding, a society where everybody is looked after, and a more extensive benefits system, where everybody has plenty. A government, in essence a ‘nanny state’, which uses its extensive financial power to pay for the whopping £60bn spending commitment. The issue lies in the fact that the majority of the electorate lack any basic economic education. Corbyn’s promises are vote-winning among many who quite rightly want more money into their public services. Yet a great proportion of the electorate are blind to the fact that this is wholly unrealistic, and is, frankly, fiscally irresponsible at a time when out national debt is approaching two trillion pounds. It is wrong for Corbyn to play monopoly with the world’s 5th largest economy, propose ideas of greater borrowing and greater taxation which have time and time again proved to be unsuccessful and damaging to the UK economy: to be a shepherd, leading the sheep astray. At the outset of the election, Paul Johnson, the wise old owl heading the IFS (Institute of Fiscal Studies) predicted: “We will be presented with false choices. Maintaining the current level of public services with no more tax on the one hand. Substantially improving public services by only taxing the rich, the multinationals, on the other. Neither looks real.” It is clear now in the aftermath that this prophesy is resoundingly accurate. Labour planned to, as Mr Johnson forecast, raise the money to fund its pledges through raising corporation tax to 26% and raising taxes on “the rich”, stamped as those earning over the arbitrary number of £80,000 p.a. There are a number of flaws with this. Firstly (and, most obviously), how does an income of £80,000 define you as “rich”? Perhaps in the North of England or Scotland, but with living costs in London? Aside from that, there are not enough people to raise the sums Labour seeks. The top 5% of income earners already pay 47% of


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