A great country like Pakistan having world-class leaders and a strong democracy guaranteed by all the stakeholders should not have to follow the footprints of foreigners, particularly westerners. And UK should be the worst example to follow. They have been our colonizers and can never be our friends, so why follow them. Moreover they may be setting inappropriate examples for us to dare us to follow them. This may be a perfect Zionist conspiracy.
This post is intended to forewarn our economic managers not to follow the examples set by the UK’s new Premier. A Businessweek column by Mark Gilbert informs that Cameron is about to embark upon an unprecedented experiment. He has told government departments to brace for spending cuts of as much as 40 percent as he seeks to shrink both the UK’s record budget deficit and a public sector that now accounts for nearly 20 percent of all UK jobs. They may have experienced budget deficit for the first time but for us, this is just normal every year in June. We are used to it. UK, with its growing population of South Asian origin, should also get used to it.
The paper informs that with the biggest deficit among Group of Seven nations and the worst looming shortfall in Europe this year according to European Union forecasts, the UK doesn’t want to be the next Greece [he could not write Pakistan because Pakistan is already known around the world for other reasons]. Less than a minute into a June 22 budget speech, Chancellor of the Exchequer George Osborne suggested that bond vigilantes are driving U.K. economic policy. “Questions that were asked about the liquidity and solvency of banking systems are now being asked of the liquidity and solvency of some of the governments that stand behind those banks,” he said. “I do not want those questions ever to be asked of this country.” The austerity debate is now not about whether fiscal tightening in advanced economies is necessary, but on when it should begin in earnest.
That’s why policymakers around the world will be watching Britain—especially those at the Federal Reserve, which is not yet ready to follow Osborne’s lead. The Fed’s colors are still tied to the mast of maintaining stimulus and keeping borrowing costs as close to zero as possible. At its June 22-23 meeting, the Fed said it would even “need to consider whether further policy stimulus might become appropriate if the outlook were to worsen appreciably.”
America has remained Pakistan’s traditional and perpetual ally at every hour of its (America’s) need and for this reason, both the countries passionately share at least one passion- spending. Spend at all costs, even if you have to beg, borrow or steal and even sell grandma’s jewelry or/and dispose off family silver, but you must spend. Spend and unlike USA, spend out of public kitty. That will keep the economy going. This is the reason, Pakistan and the USA, even after realizing the need to tighten the belt, are not ready to accept austerity. Both want someone else to do it first and UK has done it. Are we ready to follow? The columnist writes: “With the world economy threatening to slide into a double-dip recession, both the US and the UK are nevertheless talking about fiscal austerity. The only good news for Obama is that Cameron is going first.”
Watch out guys. Don’t buy austerity and never ever fall into its trap.