While I am pondering the problems of Keir Starmer’s government, a comment or two about mixed economies might be timely.
If you are a party with socialist principles you are expected to maintain the safety net for those in need. That comes with a cost and finding the money for various social services and the National Health Service is never easy.
You could try and place a higher tax burden on the rich, but they could move abroad. You might want to raise the level of taxes for multinational corporations, but they too could move their operations overseas. So what do most governments end up doing? They ask the public sector to make financial sacrifices for the public good.
This is a tricky strategy because trade unions are not keen on their members making financial sacrifices. The family silver was sold off by Margaret Thatcher’s government. Public/private finance initiatives have had mixed results but Tony Blair’s government gave them a go.
You could just print more money and watch inflation soar. So you will have to ask industry and its workforce to do their best to grow the economy.
odespinner 