Do you think we should rebalance state spending to spend more on investment and less of welfare and similar day to day activities?
Here is some history to give you an idea of how spending has changed over time.
http://www.ukpublicspending.co.uk/past_spending
Total spending as a percentage of gdp hasn't risen for reference.
Not sure what you mean by the bold statement above? See graph below from that source.
I'm not sure that you can easily separate "investment", "welfare" and "Day to day" as your statement implies.
If you are asking should we continue to cut state workers such as police/health/fire etc for supposed (but not materialised) gains I can't see that as a likely wise decision.
My broad understanding of keynes contribution was to consider the value of a
mixed economy which involves state investment / stimulation for private investment.
As time magazine points out this may include money the state doesn't currently have. Obviously wasted money is wasted money, another 12Bil for an NHS patient record built by private companies for a state system is not likely desirable, years late, seemingly no clause in contracts for over budget and deadline, no recourse to those in government or business making the deal, unlikely it was wise.
Being right on a single issue (although Osborne didn't cheer on the changes of Brown, that suggests he would have done the same, and that isn't the case) doesn't make him a better choice overall. Lots of politicians of all parties can be correct on single issues, but it doesn't follow they are correct in all their views.
In view of the magnitude of the issue (notwithstanding huge disparities in the CVs of the 2 at the time) it seems a bit odd to take this position.
I don't think Cable a saint or prophet or even strongly aligned with my political thoughts, he was/is likely to the right of the Lib Dems, he had the good sense and education/experience to see how far we had moved away from Keynes (including in his own opinions actions before the crisis) and suggest we re read some recent history right around the time of the crisis.
Which regulation change, specifically, do you think caused the UK public spending crisis?
I'm not convinced a single change in a single country gave us "innovative banking" complete with fake "good" debt. On a small scale I (and others) observed the change as my partner worked for an international bank. Her section was not sales orientated, but much of the language and behaviour became "product", mostly focused on debt, bonuses given to individual sales people before and without thought of the probability of repayment, with virtually zero external oversight.
Though ahead of the curve on the risk of such economies, I wouldn't be surprised if Cable favoured "light touch" regulation too (until the crisis where unlike Osborne he waded in on banking). After Thatcher and Regan moved us away from Keynes to Friedman, we ended up where even the supposed "new" Labour party were following Alan Greenspan and laissez faire economics. Hopefully we've all learnt the lesson that the market doesn't always decide for the better of all, actually in many areas, the less regulation the more we live in something like a jungle.
Those people and the thinking that took us to that point, should no longer be involved in shaping our future!
Google says these are quotes from Keynes:
In the long run we are all dead.
The difficulty lies not so much in developing new ideas as in escaping from old ones.
The market can stay irrational longer than you can stay solvent.
Capitalism is the astounding belief that the most wickedest of men will do the most wickedest of things for the greatest good of everyone.
Words ought to be a little wild, for they are the assault of thoughts on the unthinking.
Education: the inculcation of the incomprehensible into the indifferent by the incompetent.
By a continuing process of inflation, government can confiscate, secretly and unobserved, an important part of the wealth of their citizens.
Ideas shape the course of history.
The avoidance of taxes is the only intellectual pursuit that still carries any reward.
If economists could manage to get themselves thought of as humble, competent people on a level with dentists, that would be splendid.
By the way I'm not saying Follow Keynes and we'll all live happily ever after. At least now we can start to discuss the proven value of investment and the limits of cuts when considering the performance of the economy!
It's unfortunate how in the grand scheme of things we are powerless as individuals to change things for the better, we can only help ourselves through saving and prudence