Economics

So we've now had the "emergency budget". Did it make any sense? Well that's another question. I'm no economist but I do understand common sense and logic and to me this budget didn't add up. The government's declared intention was to encourage "the economy" to grow. As I understand it "the economy" is measured in terms of the amount of stuff we produce and sell. So basically the government wants producers to produce more and consumers to buy more. So to encourage this it increases VAT to 20%, thus making everything more expensive. Wages are frozen and benefits cut, meaning that people will have less money to spend. So with less spending power and higher prices normal logic would dictate that people will be able to buy much less. Is the government completely off its rocker or is there a special kind of economic logic of which I am unaware? If anyone can advise, please leave a comment.

David Cameron is apparently asking for suggestions of how to get us out of the financial mess we are in. I don't know that I can help here but I can make some suggestions to help prevent us getting in a similar mess in the future.
As the problem is basically too much debt, both nationally and individually, one simple remedy would be to ban the continuous stream of junk mail being sent out by the banks trying to encourage people to have one of their credit cards. I must get at least one of these per week. I do not want a credit card. Credit cards lead people into debt. As a bank customer I am appalled at the expense they go to to promote these things. This is my money they are using (and other customers) which would be far better used in giving us all a better rate of interest on our savings...... quite apart from the acreage of forest that must be destroyed annually to service this rubbish. If people really want a credit card they can go to the bank and request one ...... it really is not a commodity that needs advertising (they don't advertise cheque books for heaven's sake!).

Alongside the junk mail ban the government should also restrict credit cards to one per person. This should be quite sufficient for peoples needs yet still retain a certain amount of control over the amount of collective debt.

The answer is obvious, Mr Cameron, now get on and do it!