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Also: when the state pays benefits to people it isn't lost money. If you're on the dole, you don't save. You spend what you have on basics for survival. If the benefits are even slightly generous, you maybe also spend a little on a cheap tv and a day out for the kids now and then.
Money being spent in shops helping keep those shops in business and bringing in tax revenue.
Cutting benefits takes those people out of the market. Stagnated wages and rising costs of living along with the prospect of unemployment as so diabolical that it's frightening, means people in the lower end jobs also stop spending. Siege mentality takes over.
We're in a demand led recession in the UK. You cannot cut your way out of that.
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