Quote:
Originally Posted by halfpint
The pay cuts are allready happening over here in the UK and we are having demonstrations by public sector workers. Even the Police went on on a march. I work in the private sector and talk to a lot of people and a lot of companys are having real cash flow problems which causes wages to be paid late and bills not being paid on time which then causes the workers more bills for late payments. Its a spiraling bubble which is going to burst sooner or later.
We are seeing a huge downgrade and loss in memberships in the company who i work for, We send out letters asking why they have left or downgraded and 99% of the replies is loss of work or pay cuts.
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The Public Sector was supported by loans. That money flowed into the private sector via public sector spending their wages and the money spent in the public sector from building an Olympic Stadium to buying a worker a hard hat. Cut taxes or/and borrowing, the tap is turned off and we all suffer.
The myth that cutting taxes generates growth is put out by the rich to keep their money. They won't build an Olympic Stadium or motorway and employ 1,000s to do it. They will buy more shares, a yacht, an expensive imported car. Those who get an extra $10 a week won't do anything but buy something made in China.
The myth that people work harder when paid more is also stupid. Who here is working harder now than they did in 2002 when it was easier? If you can earn a great income in 10 hours a week, few will work 60. Few would spend less time with their family, leisure and pleasure, because they're earning more.
But
"I will cut taxes, so you can spend your money and it will generate growth." Get's people elected. Proof of this is happening in the UK today.
One job lost in the Public Sector, is one less person spending his wages in the local area.
We can't over inflate the public sector like some countries have done, but once inflated. Deflating it a dangerous route.