There is none; the answer does not exist. Households, private sector and governments have to de-leverage a colossus amount of debt. Stimulus and inflating the bubble (again) will make the depression even worse-which we are currently in-and would destroy living standards even more.
During the Great Depression, British growth was sluggish and uninspiring. But the economy grew, similar to current standards. All packages to accelerate growth and employment proved to be insignificant – the economy had to rebalance from the excess credit addiction. You cannot maintaining spending and credit without a massive contraction or, worse case, economic collapse. Japan is entering a second loss decade after a similar housing bubble in the 90s and China phantom construction boom is about to explode.
Europe is becoming the new Japan.
The entitlement culture, corporate and welfare, is too costly for the economy. Corporate socialism should cease to exist under the coalition; a failing business should fail. Government should not bail out the losers and hand the losses to the taxpayer. And those, who think a life on benefits is good choice, need to be dealt with. Taxpayers should not finance the lifestyle of those who refuse to work; this
minority are just as bad as bankers, who demand we write cheques for huge losses.
As I’ve said countless times on Twitter, cuts will continue post 2015 – we have not begun to deal with Britain’s spending addiction. Western economics, with huge deficits and debt levels, have no choice but to advance towards fiscal sanity, whilst hoping the emerging economics can continue to reform and expanded. But there is nothing we-this government-can do.