Government Screwing Up
We need to stop the Government screwing up IT Contractors.
As we said in an article recently, Anatole Kaletsky, the Economics expert at The Times said a year ago that the UK and US had the same problems to pretty much the same degree and were at the same point of the cycle so it would be very interesting to see how they both did over the next year or two as they were prescribing the total opposite cures for the sick patient.
The UK Government had fought the election on austerity measures to cut the budget deficit.
The US had decided to use Keynesian measures to put money into the economy to grow it so shrinking the budget deficit by getting more tax income in.
So, which way is succeeding?
Well, here the Government had told us that the budget deficit would be gone by the next election.
After not much more than a year they are now telling us that it will be two years after the next election.
When they totted up their figures they were expecting growth in the economy.
However, those out of work because of budget cuts were now not paying tax and were claiming unemployment benefit and as they had less to spend, businesses were not benefitting by it and so were paying less tax and laying people off.
When the Government took over, the economy it was growing at 2.8% a year.
Now, it has shrunk by 0.2% in the last quarter.
Unemployment is rising too and those unemployed are claiming benefits and not paying tax.
USA Contract Market
So, how is the US doing with opposite policies to ours?
Whereas the UK economy is predicted to contract by 0.5% this year, the US economy is predicted to rise by 1.8% his year and 2.2% next year.
In the last 22 months 3 million jobs have been created – the most since 2005.
Unemployment has fallen to a 3-year low.
Obama spent half a trillion pounds on a stimulus to the economy while we were putting in place austerity measures.
He gave a payroll tax cut of $40 to 160 million of the lowest paid Americans who mostly went out and spent it so that businesses flourished, paid more tax and hired more people.
The Republicans will be fighting the next election on the same policies that Cameron and Osborne won the election here on – austerity and budget cuts.
Cutting the Deficit
However, as Obama says ‘Cutting the deficit by gutting investment was like lightening an overloaded airplane by removing its engine’.
One would have thought that made sense to a Conservative Government.
Till they get this message and change course IT Contractor jobs and rates will continue to be affected.
It’s time to stop the Government screwing up IT contractors.