“Words mean what you choose them to mean, neither more nor less. The question is which is to be master — that's all.” Lewis Carroll, Through the Looking Glass
What is growth?
There is a vast amount of talk about growth but very little explanation of what it means. Economic growth is not a slogan. It is about economic prosperity and jobs. It comes from the use of private capital and private enterprise turned into profit. This is of two kinds, one of which is in relation to businesses of all kinds, large and small, and the other is of the profitable difference between imports and exports at a national level. Public expenditure of every kind – the payment for hospitals, for schools, for civil servants, for every worker in the public sector and for their pensions and for all manner of defence expenditure, public infrastructure, payments to the European Union – comes from one solid, simple source: the reasonably taxed profits of private enterprise. This is the foundation of growth.
When private enterprise is profitable, public expenditure can be justified. If there is no profitable private enterprise, there is no means of paying any public expenditure, unless of course the printing presses are turned on and money is merely printed. This is a prescription for disaster. By the same token, in relation to our external trading as a nation, there may be trade, but there is no growth if our exports do not exceed our imports.
On both the domestic front relating to the profitability of private enterprise and in relation to our external trading with the European Union, there is no growth because private enterprise is strangled by red tape and overregulation and a lack of tax incentives and on an external trading basis there is no growth because with the 26 Member States with whom 40% of our trade is conducted, we are running a monumental deficit. The problem is therefore simple to perceive, even if the solution is less simple to achieve.
Please click here to read UK Growth strategy: harsh EU realities and weasel words
