By Tom Winnifrith | Thursday 11 May 2017
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from ShareProphets). I have no business relationship with any company whose stock is mentioned in this article.
England (well mainly the South East) subsidises Wales, Scotland and Northern Ireland. C'est la vie. It is part of being a United Kingdom. Personally I'd send all the Celtic loons packing, give them their independence and slash taxes for we hard working residents of England. But that is not the way and just to rub our noses in it, Welsh resident, Malcolm Stacey celebrates how local councils and the Welsh Assrembly have ponied up £50 million to turn some Godforsaken post industrial shit hole in South Wales into a new "Silicon Valley." Bollocks.
I wonder how may real jobs - that is to say long term private sector jobs not administrators and support staff at the Welsh Assembly - this will create? What is the cost benefit analysis? What evidence is there that the sheep molesting bureaucrats will pick the right firms to offer cheap office space, grants and other assistance to?
I put it to you that over many years the record of Government in "picking winners" is truly diabolical. When it comes to picking winners, the State makes Zak Mir and Justin the Clown look like Warren Buffett and George Soros.
The real Silicon Valley was not founded with taxpayers cash but arose because of private sector investment. It is the private sector that creates jobs. It is the invisible hand of the market that sees capital allocated to firms that will win and more capital allocated to those that are winning so much that they grow and take on more staff.
The way to revitalise the Welsh economy is not to spend more money borrowed from England, or rather from the money tree that is the UK's burgeoning deficit, on projects which some Guardian-reading official reckons may be "the next best thing." If Wales wants to be a Celtic Tiger it should seek powers to slash corporation tax to spend less and tax less and let the private sector do the talking, the job creating and the wealth creating.
In fact, post Brexit, the United Kingdom as a whole has a unique opportunity. Whilst Mr Macron and Frau Merkel plan what dastardly things they can do to Britain to punish us, forgetting that as net exporters to the UK their own people will be the hardest hit by most of what they propose, the UK should plan for Brexit day with a shock announcement. On the day we leave the Evil Empire, the UK Government should abolish Employers NI contributions (more than offsetting any tariffs Macron et al might impose) and announce that we are also slashing corporation tax to a Western World low of 10%.
That would create Silicon valleys across the UK and see firms flocking to relocate from the EU economic zombie to Britain. In due course the massive increase in economic activity would see corporate tax receipts race ahead and in the short term we could balance the books by slashing the amount allocated to bodies such as the Welsh Assembly which clearly has more than enough, of other people's, cash to piss away.
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