When I was a teenager, I spent a lot of time in Newcastle Central Library. I spent a lot of time in the 700 series shelves, in particular 720 and 792.
In the building engineering section, there was a substantial volume called “Electric Lifts” which had a massive chapter on lift accidents. One particular tragedy sprung to mind- An old fashioned manual passenger lift of thw whicker gate variety went wrong one day and the motor overtravelled, causing the lift car to hit the buffers at the bottom of the shaft. It wasn’t a particularly scary trauma and the lift operators worked out that if they moved the handle to down it went up and vica versa. They carried on that way for a long time afterwards then one day they took the lift up to the top floor and the car lost control, plunging the occupants to their death.
Investigators eventually worked out what had happened. It was an old style drum lift where cables wound onto the drum whilst the counterweight cables unwound. When the lift overtravelled (due to the failure of a limit switch and a lazy operator keeping his hand on the down handle) the car and counterweight cables effectively unwound to their limit and then started wrapping on the other way. The consequence of this was that the lift motor was still more or less in balance but at the top of travel, the cables were at an acute angle to the drum und under unnatural tension. Eventually the strain was too much and they catastrophically snapped.
So, what has this got to do with the economy? Well, it is an analogy. When things go wrong, doing something counter-intuitive (like spending more money you haven’t got when you are in debt) might give you a warm feeling but eventually it all goes horribly wrong and the bailiffs come round. (or in Labour’s case, the International Monetary Fund).
So what are good investments when there is talk of printing even more money, creating more make-work jobs and taxing savings?
Here are a few suggestions, click through for more inspiration & sources.
I think the truth is that the Government (and the opposition) don’t really know what to do for the best and are not prepared to do the right thing- let the market equalise itself.
They always do.
“Fiscal Stimulus team sir? that’s in the Quantitive easing department, 6th floor, mind the doors, going up. Yes I know I’m pushing down on the handle, it certainly is counter intuitive but it gets the desired result. Here we are sir, sorry about the creaking noises above, it always does that on the top floor…”
And Canada is about to do the very same thing in the upcoming budget. The piper has to be paid sooner or later, later means having to pay so much more.
I do agree with the gist of what you are saying, but at least the Tories are trying to promote saving by abolishing savings tax. Not sure if it really makes a difference but it is a step in the right direction.
Personally, I think they should all be encouraging us to pay off our debts and reducing the cost of the state dramatically in order to fund a dramatic increase in personal allowances in order to take most people out of personal taxation totally. That way we have more of our own money to spend wisely or foolishly.
Screw paying the national debt. I am not the nation, and my kids won’t be either. I didn’t consent to them spending huge amounts of money bombing out countries. Why should I pay for it?
Martin, I wasn’t talking about the national debt, but personal debt. There are only two ways to pay off the national debt- the government has to tax more than it spends or we default on the debts (i.e. go bankrupt) and that would probably lead to curfews and troops in the streets. Indeed the first one will, if the approach is to tax more rather than spend less.