Changing times

'The times they are a changing'. These words were written by Bob Dylan in the 1960's, and I think these words could be sung every year. We do live in an ever changing world and as we go on things will probably change quicker and quicker. Prior to World War 1 our society and many others around the world hadn't changed in centuries; the old way of doing things, the class division and royal families throughout Europe had existed for centuries. After the war many things started to change; communism raised its ugly head, then along came fascism and many of the royal houses disappeared. Within Britain the old way of doing things changed as well, we didn't have a revolution but the old class divisions started to break down.

If we move forward to the sixties we then had a total social revolution, and most commentators would agree that this period saw the greatest change. As we move forward to today I believe we are going to see a greater change than at any point in history. I believe that the next 10 years will have a greater effect upon our lives in this country and many others than at any other time in recent history.

I believe (and of course these are only my opinions) that the western world and particularly this country is going to change dramatically. Over the last couple of days George Osborne has announced dramatic cuts to public spending, and in my view he had no choice. Labour politicians, economists and some other so called influential people have said that cutting too quickly will send us into another recession. They could be right, then again they could be wrong, no one can see the future.

One of the things I have learned over the years is that we have many people who are called experts. These experts state their opinion and because they have a qualification and some experience in a field, people listen to them and put them on pedestals. Economists are people who have many opinions and most of the time it isn't based on fact, just on educated guesses or conjecture. Gordon Brown talked of an economist called John Maynard Keynes, he was an economist and he is best known for his proposal that when national economies suffer a downturn, governments should borrow and spend money to boost economic activity. Part of the proceeds of the resulting economic growth should then be used to repay the debt. This economist was put on a pedestal by Gordon Brown and towards the end of his premiership he put a lot of faith in Keynesian policy. Winston Churchill said of Keynes, that if he had 3 economist in a room and one was Keynes, he would get two different opinions from 2 of the economists and 2 different opinions from Keynes himself.

As you can imagine I am very sceptical about a lot of what many people say, I believe people in the western world have to start waking up to the reality of what is happening in our world. I mentioned in my previous post about the increase in full maternity pay to 20 weeks; the simple question is, who is going to pay for this increase? It is reckoned it could cost £2.5billion to Britain alone, as you can imagine with the cuts that are happening the government can hardly afford to pay this, so the only people who will pay is business. We also have French workers striking about the increase in the retirement age to 62, and many countries in the western world are starting to see change, both in government and in attitudes. In the last week Germany's Chancellor Angela Merkal denounced multiculturalism, and in June this year Belgium elected a separatist Government, I could give you plenty of other examples.

The point I am making is that we in the rich western world have had it good for so long, we have continued to see growth in our economies and we haven't had to worry about any real disaster hitting our countries. What we are seeing now is the balance of power changing, and if we are not careful we will see our economies drop into the second division. Countries like China and India are constantly changing and are continuing to see massive growth, and many of the countries of the west are limping along.

Britain for a number of years has seen continued growth, not only in the economy but in standards of living, but I believe this cannot continue and the cuts that have been made will show that to be true.

I want to quickly look at how I think things could change over the next few years. Our economy has changed dramatically in the past 50 years, from being a country which was heavily reliant upon manufacturing to an economy which is now reliant upon the service industry (I have explored this in a previous post). We have been able to rely upon our financial sector to bail us out, but I now believe this could change. Recently our Chancellor and Prime Minister signed up to EU financial regulations, this basically means the EU will be able to regulate our finance industry. Some people might argue that this is a good thing, and if the finance industry had been regulated properly in the first place we would not be in the mess we are now (there might be some truth in that).

Putting aside the rights and wrongs of the past, let us to look to a possible future. Currently manufacturing makes up about 12.5 per cent of our economy, and with the current cut backs we will see that decline. With the regulation being brought into the City of London we sill see companies leaving, thus taking revenue away from this country. Just one little aside the EU are bringing in regulations that will affect hedge funds, hedge funds had nothing to do with the financial collapse and were worth £5.4 Billion to this countries economy last year. I can imagine many of these companies going elsewhere. Many people argue that we should hit the finance industry hard, but even though I agree that speculators and bankers have reeked havoc on our economy, we have to work with these people or they will go where the money is. Whether you like it or not we live in a capitalist country and business wants to make money, if business leaves are economy will die.

We in this country have been very fortunate, even with most of our manufacturing industry gone we are still a rich country, at the moment countries like China and India still need us because of our finance industry. I believe this will soon change, China is going to continue to grow and as it does it will gain more expertise in finance and will then start to persuade the big finance companies to move. Because our economy is so reliant on these companies we will then see a downturn in our GDP and then our standard of living. Don't think that any of these big companies have any loyalty to Britain, they don't, they are capitalists and will move if it benefits them.

I know this sounds rather gloomy, but I believe if we don't change the world will march on and we will be left behind wandering what went wrong. So what can we do? I believe it isn't too late to change things, but only if we implement the right policies, I will look into that in my next post.