Institution
Britain, just like the other European countries, had been hit by the 2007-2008 economic crisis. The ratio of public debt to GDP had risen to 80% by the year 2010. Cameron came became the prime minister during these hard times. His first goal was to deal with the UK's economic problem. In light of these circumstances, he introduced the £ 40 billion austerity plan in the same year. The intention of this policy was to cut down on the government spending that had contributed much to the public debt and budget deficit.
The Prime Minister Cameron's government policy of financial austerity was not the right answer to the U.K.'s economic problems in 2010. This is because when Cameron began rolling out this strategy for austerity, the government spending was cut with the objective of minimizing debt. However, the problem with this approach was that when government spending is decreased, the legs out from economic demand are also cut. The other reason austerity was not the best approach is that it aimed at cutting salaries and other benefits hence putting tiny money into the pockets of consumers. Cameron government's policy indicated that the government expenditure on economic growth …show more content…
Many economists attest to the fact that austerity fails to reduce deficits and debts and during Cameron's reign, the financial position of U.K. was significantly worse. In comparison to other countries, U.K.'s economic performance was worse than that of France and particularly and many several countries in the European Union bloc. In the first two years, Cameron's government had worse numbers than Spain. It is evident that austerity serves no financial purpose. Its exists on the records that the Conservative Party needed to cut the welfare state with the aim of reducing taxes on the wealthy and for no other
Britain, just like the other European countries, had been hit by the 2007-2008 economic crisis. The ratio of public debt to GDP had risen to 80% by the year 2010. Cameron came became the prime minister during these hard times. His first goal was to deal with the UK's economic problem. In light of these circumstances, he introduced the £ 40 billion austerity plan in the same year. The intention of this policy was to cut down on the government spending that had contributed much to the public debt and budget deficit.
The Prime Minister Cameron's government policy of financial austerity was not the right answer to the U.K.'s economic problems in 2010. This is because when Cameron began rolling out this strategy for austerity, the government spending was cut with the objective of minimizing debt. However, the problem with this approach was that when government spending is decreased, the legs out from economic demand are also cut. The other reason austerity was not the best approach is that it aimed at cutting salaries and other benefits hence putting tiny money into the pockets of consumers. Cameron government's policy indicated that the government expenditure on economic growth …show more content…
Many economists attest to the fact that austerity fails to reduce deficits and debts and during Cameron's reign, the financial position of U.K. was significantly worse. In comparison to other countries, U.K.'s economic performance was worse than that of France and particularly and many several countries in the European Union bloc. In the first two years, Cameron's government had worse numbers than Spain. It is evident that austerity serves no financial purpose. Its exists on the records that the Conservative Party needed to cut the welfare state with the aim of reducing taxes on the wealthy and for no other