A new Chancellor, a new age?

New Chancellor Phillip Hammond has made clear his intentions for the future of fiscal policy in the UK, deciding to scrap George Osbourne’s failing long term plans dating back to 2010 of achiving a fiscal surplus, for which he consistently pushed back his set deadline. Does this mean the years of austerity are finally over?

Hammond announced his intentions to invest around £2bn into housing to build 40000 homes by 2020. However, Hammond did make clear that since the Brexit vote, the UK faces a future of uncertainty, and these changing times require a change in policy. He did not criticise Osbourne since his policies were right for the times, but now we require more expansionary policy. However, this does not mean there won’t be cut backs in future, since the budget is ‘eye-wateringly large’, Hammond must keep a close eye on this as well.

Hammonds plans to invest into housing will be beneficial in the long term of the UK economy. In the short-term the increase in employment helps to stabilise the economy, encouraging further spending, which is required to offset the likely drop in spending due to uncertainty of Brexit. In the long term, infrastructure will help to improve the productivity in the UK and will hopefully help us compete more on international markets.

With Theresa May announcing the intention to invoke article 50 by March 2017, the need for more expansionary policy became clear, with austerity policy may do more harm than good in current economic conditions. Saying this is contrary to growth statistics since the brexit vote which have been surprisingly postive, but hard times ahead are expected. Nevertheless, Brexit negotiations will likely have a greater impact on the future of the UK economy than fiscal policy in the years to come, with the hope than the UK can negotiate some trade deals which will ensure the preservance of the UK export markets and FDI.

Have we been abandoned politically?

 

First David Cameron, then Boris Johnson and now Nigel Farage. Did things just get too difficult or have these political leaders stepped down for good reason?

It was generally believed before the referendum that David Cameron would step down in the event of a leave vote. In my opinion he had little other choice but to resign since he would not have been the right person to negotiate terms to take our country out of the EU, after all he himself had wanted to remain. It makes sense that someone who had campaigned to leave would take on leadership of the country.

Boris, for example. Oops?

In a shocking turn of events Boris Johnson announced he would not be running in the Conservative Party leadership race, having previously been the favourite to succeed David Cameron. Why did he step down? He simply didn’t believe he was up to the job, having discussed this with his colleagues, however having led the country out of the European Union, I feel he has some responsibility to the country in helping us get out of this perceived mess that he arguably caused. Nevertheless, he left when the going got tough, so perhaps we’re better off without him. Instead, from the leave campaign, we’ve been left with Michael Gove, who doesn’t even have the backing of his peers, with the majority believing Theresa May will make the best successor. Gove, previously saying he did not want to be PM surprisingly decided to enter the race instead of Boris. It is my belief that the Tory Leave campaigners believed he was a better candidate to represent the Leave side rather than Boris who has been exposed far too much in the media for example his rugby antics in Japan, getting stuck on a zip wire in London and his backwards basketball shot. These are not actions of a Prime Minister. Can you imagine if Boris Johnson and Donald Trump were the leaders of two superpowers?

Now we come to Nigel Farage. What is there to say? He embarrassed himself at the EU Commission last week, not helping the UK’s position in its negotiations and now he has resigned as UKIP leader, claiming he has done what he planned to do. All I have to say is he’s left the job half done, abandoned ship before it got any worse. Instead of developing a plan for leaving the EU, they just campaigned to leave and now left the job to get the country back on track to everyone else. Pathetic. Irresponsible.

These MP’s have left the country out to dry. Making false promises which they instantly went back on and now resigning before the are required to implement any change, which they know they can’t do. They promised we would get our country back, but I’m not sure I want it back now that it’s falling apart. It only thanks to the Bank of England that we’re still afloat. Today they reduced banking restrictions freeing up around £150bn for lending and 8 banks have also agreed with George Osborne to extend government spending if necessary.

Therefore, tough times ahead still seem inevitable, despite the best efforts of the bank, no thanks to our leading politicians.