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A letter to the editor - Essay Example

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Summary
George Osborne, the United Kingdom’s chancellor of the exchequer postulates that in order to avoid economic stagnation, especially after the effects of the Great Recession, and ensure better lives for future generations, there is need to cutting on spending to reduce deficits,…
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A letter to the editor
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A letter to the editor

Download file to see previous pages... Although this has worked for the United Kingdom, the author of the article has presumed that it could also work in all the other developed countries. However, he has overlooked the fact that each country has its own distinct economic system, thus some economic strategies in one country might not be successful or apply in another country.
In addition, the link between economic growth and deficit reduction, which the author’s argument base on, is disputed. When government spending reduces, as the author suggests, this does not guarantee that there will be economic growth due to the result of a reduced deficit. In some cases, reduced government spending might slow down economic growth, as the government cuts on spending on various goods and services. This might directly result in a contraction in the economy, and consequently a decline in public-sector employment, which will restrain economic growth or recovery.
However, it is agreeable, as the author puts it, that the government should highly invest in areas such as education and infrastructure. To a greater extent, such investments by the government might lead to more employment opportunities and result in skilled workforce. For this reason therefore, the author should have considered suggesting a moderated cut on government spending, as extreme cut on government spending might have detrimental effects on the economy of the present and future ...Download file to see next pagesRead More
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