|
Post by venceremos on Dec 4, 2014 16:00:42 GMT 1
- says a spokesman for the Institute for Fiscal Studies (an independent body). "Colossal" spending cuts required after the election if Osborne's plans announced yesterday are to be realised.
I know some will see that as a good thing. But has Osborne earned the right to be trusted with the management of the economy after the next election? Remember his promise in 2010 that the deficit would be eliminated by now? Yet here we are, with a £90bn deficit this year, only down £6bn from last year. How is that a good performance?
The IFS says Osborne missed his target, not because the cuts needed to be deeper, but because the economy performed so badly after 2010.
Now we have record employment but lower than expected tax receipts. How can that be? If more people are employed, surely you'd expect more tax to be paid? Not if wages and disposable incomes are too low for people to be earning (income tax and national insurance) or spending (VAT) enough. The government can chirp all it likes about economic growth (such as it is - and it's forecast to fall next year) but most people haven't seen any benefit. That's what happens when you allow economic and income inequality to run rampant.
Apologies to those not interested in these things but we shouldn't go into the election campaign under the illusion that the economy's healthy, or even on the mend. Unless we get a lucky break somewhere, it still seems likely that it's going to get worse.
|
|
|
Post by Exkeeper on Dec 4, 2014 16:30:05 GMT 1
As always with Osborne's failures, he will put it down to "the mess we were left with by the previous government". I truly hope that he and his chums are soon to be referred to as "the previous government".
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Dec 4, 2014 16:39:19 GMT 1
As always with Osborne's failures, he will put it down to "the mess we were left with by the previous government".". [ Don't forget my personal favourite "it's a global problem".
|
|
|
Post by venceremos on Dec 4, 2014 16:58:21 GMT 1
As always with Osborne's failures, he will put it down to "the mess we were left with by the previous government".". [ Don't forget my personal favourite "it's a global problem". Quite, though it's odd that it wasn't in 2010. Funny that.
|
|
|
Post by stuttgartershrew on Dec 4, 2014 17:29:52 GMT 1
When I look at politics in England I just shake me head and wonder what the hell is going on. The Tories and Labour I wouldn't touch with a barge pole which means I'd be looking for a third, an alternative. With the LibDems pretty much done and dusted there simply isn't one.
I believe there is a huge opportunity for someone to come in and take full advantage of this complete mess but alas I doubt it will happen. People will vote Tory. People will vote Labour. And so it goes on. Shame that as I wouldn't want either of them running the country.
|
|
|
Post by mattmw on Dec 4, 2014 17:37:13 GMT 1
Finance expert on Newsnight was saying the next round of cuts would see the percentage of GDP spent on public services at its lowest figure since the 1930s.
Quite a sobering thought as we didn't have the NHS and majority of of the welfare state then. Surely people don't want a return to those days?
Personally think the deficit is just an excuse to sell more public sector to big business. At a time the debt is rising it was a disgrace the government sold off Royal Mail well below its real value, with many private finance companies making millions in a few days as a result of the sale. Next up is all the nice NHS contracts the government are putting up for grabs
|
|
|
Post by lenny on Dec 4, 2014 17:57:44 GMT 1
- says a spokesman for the Institute for Fiscal Studies (an independent body). "Colossal" spending cuts required after the election if Osborne's plans announced yesterday are to be realised. I know some will see that as a good thing. But has Osborne earned the right to be trusted with the management of the economy after the next election? Remember his promise in 2010 that the deficit would be eliminated by now? Yet here we are, with a £90bn deficit this year, only down £6bn from last year. How is that a good performance? The IFS says Osborne missed his target, not because the cuts needed to be deeper, but because the economy performed so badly after 2010. Now we have record employment but lower than expected tax receipts. How can that be? If more people are employed, surely you'd expect more tax to be paid? Not if wages and disposable incomes are too low for people to be earning (income tax and national insurance) or spending (VAT) enough. The government can chirp all it likes about economic growth (such as it is - and it's forecast to fall next year) but most people haven't seen any benefit. That's what happens when you allow economic and income inequality to run rampant. Apologies to those not interested in these things but we shouldn't go into the election campaign under the illusion that the economy's healthy, or even on the mend. Unless we get a lucky break somewhere, it still seems likely that it's going to get worse. It is on the mend, though. There's still significant nominal growth and, finally, real growth is starting to kick in (albeit minimally and belatedly). It's not anything like Osborne predicted, but at the moment it's Britain and the US who are growing whilst the other OECD countries struggle to even stagnate. Also, the cuts in spending are necessary - you highlight the size of the deficit, and while it remains so huge, an increase in standard of living is going to be very difficult to instigate. I'm uneasy in saying that it's cast-iron recovery - there's hints of the whole "house of cards" label often applied to the Nazis' economic policy (and, inept though they may be, I'm not for a second comparing our politicians) with the privatisation of the Royal Mail et al. I just don't think, sleazy greaseball though he may be, that Osborne has actually done too badly - by hook or by crook.
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Dec 4, 2014 18:44:33 GMT 1
For god sake Lenny, don't let a few facts get in the way of the lefties agenda, its either Osborne or that slime Ball by the name of Ed..... No contest.
|
|
|
Post by jamo on Dec 4, 2014 18:53:31 GMT 1
I'm not for a second comparing our politicians) with the privatisation of the Royal Mail et al. I just don't think, sleazy greaseball though he may be, that Osborne has actually done too badly - by hook or by crook. Lenny, by his own predictions and forecasts he has failed, and by quite a margin. Revisit his predictions of 5 years ago, what he was going to do and where we - as a country would be now - and then revisit your opinion. He is way off target and as a result this country really does stand at a crossroads in May. If we leave this bloke in charge we really can forget public service.
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Dec 4, 2014 19:02:42 GMT 1
Jamo, you are quite right, he has failed by quite a margin, however things have stayed not been as straightforward as the growth needed was by Europe as a whole to keep everything in line, however only UK has grown, the rest have stayed static or gone backwards, which to me indicates that some of the things he has done have worked.
I would love to see what Labours plan is apart from freeze on domestic fuel, which has meant that energy companies have hiked prices up in preparation so we are paying for that now, any more bright ideas from Ed and Ed..... nope they are not making promises yet.
|
|
|
Post by lenny on Dec 4, 2014 19:07:19 GMT 1
I'm not for a second comparing our politicians) with the privatisation of the Royal Mail et al. I just don't think, sleazy greaseball though he may be, that Osborne has actually done too badly - by hook or by crook. Lenny, by his own predictions and forecasts he has failed, and by quite a margin. Revisit his predictions of 5 years ago, what he was going to do and where we - as a country would be now - and then revisit your opinion. He is way off target and as a result this country really does stand at a crossroads in May. If we leave this bloke in charge we really can forget public service. His forecasts were inaccurate and fiercely over optimistic. That was the fault, I don't think there's much more that could have realistically been done. All the global economies are massively interdependent and to be one of the fastest growing and healthiest economies is, really, as much as can be expected.
|
|
|
Post by venceremos on Dec 4, 2014 19:07:19 GMT 1
- says a spokesman for the Institute for Fiscal Studies (an independent body). "Colossal" spending cuts required after the election if Osborne's plans announced yesterday are to be realised. I know some will see that as a good thing. But has Osborne earned the right to be trusted with the management of the economy after the next election? Remember his promise in 2010 that the deficit would be eliminated by now? Yet here we are, with a £90bn deficit this year, only down £6bn from last year. How is that a good performance? The IFS says Osborne missed his target, not because the cuts needed to be deeper, but because the economy performed so badly after 2010. Now we have record employment but lower than expected tax receipts. How can that be? If more people are employed, surely you'd expect more tax to be paid? Not if wages and disposable incomes are too low for people to be earning (income tax and national insurance) or spending (VAT) enough. The government can chirp all it likes about economic growth (such as it is - and it's forecast to fall next year) but most people haven't seen any benefit. That's what happens when you allow economic and income inequality to run rampant. Apologies to those not interested in these things but we shouldn't go into the election campaign under the illusion that the economy's healthy, or even on the mend. Unless we get a lucky break somewhere, it still seems likely that it's going to get worse. It is on the mend, though. There's still significant nominal growth and, finally, real growth is starting to kick in (albeit minimally and belatedly). It's not anything like Osborne predicted, but at the moment it's Britain and the US who are growing whilst the other OECD countries struggle to even stagnate. Also, the cuts in spending are necessary - you highlight the size of the deficit, and while it remains so huge, an increase in standard of living is going to be very difficult to instigate. I'm uneasy in saying that it's cast-iron recovery - there's hints of the whole "house of cards" label often applied to the Nazis' economic policy (and, inept though they may be, I'm not for a second comparing our politicians) with the privatisation of the Royal Mail et al. I just don't think, sleazy greaseball though he may be, that Osborne has actually done too badly - by hook or by crook. Fair enough lenny, if that's what you believe. But a return to modest growth doesn't mean the structural problems of our economy have been mended. We're fixated on debt and deficit now because of what's happened since 2007. But it's wrong to think there's no other path. I'm not saying this course is necessarily wrong and, frankly, I'm healthily sceptical towards anyone that claims to know the right way. But I do think we've put ourselves in an unhealthy and damaging position when we limit the national debate by starting from the premise that "the cuts in spending are necessary". A national economy isn't a corner shop, or a household budget. In those terms, governments have always and will always "spend beyond their means". Did you hear Osborne yesterday say we're about to pay off the last of the World War One debt? No mention of the World War Two debt! Nations don't make profits and a budget surplus isn't necessarily the holy grail it's currently being portrayed to be. In fact, you must believe that yourself (perhaps even Downie does too), if you believe Osborne hasn't done too badly. He said there'd be no deficit by now, yet it's £90bn and hardly moved since last year. If that's a Chancellor not doing too badly then perhaps you don't believe the deficit is the be all and end all either!
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Dec 4, 2014 19:12:56 GMT 1
In fact, you must believe that yourself (perhaps even Downie does too), if you believe Osborne hasn't done too badly. He said there'd be no deficit by now, yet it's £90bn and hardly moved since last year. If that's a Chancellor not doing too badly then perhaps you don't believe the deficit is the be all and end all either! No I don't think he has done brilliant, and yep the deficit is still there, but it is still half of what it was in 2010, £55billion of tax money paid in interest to creditors to service the debt, hell of a difference to the NHS that do you not think after all the budget is £108Billion for them. if we cut that charge in half and gave that to the NHS I am sure things would seem a lot better.
Or we could have the chancellor telling us to borrow more and spend more money than we have to stimulate growth, whose bright idea was that?
|
|
|
Post by venceremos on Dec 4, 2014 19:16:21 GMT 1
For god sake Lenny, don't let a few facts get in the way of the lefties agenda, its either Osborne or that slime Ball by the name of Ed..... No contest. A few facts? Just the one, surely - the economy is growing modestly. My "lefty agenda" contained a few more: - Growth is expected to fall back after this year. - The deficit is £90bn, not zero as Osborne told us it would now be. - The deficit only fell by £6bn this year. - Tax receipts are less than predicted, despite record levels of employment. - Economic inequality has deepened. - Spending cuts will continue (and probably deepen) under a new Tory government. But don't let a few facts get in the way of your rightie agenda! Hey, house prices can increase again because most people can save stamp duty. Boom time!
|
|
|
Post by venceremos on Dec 4, 2014 19:18:30 GMT 1
Or we could have the chancellor telling us to borrow more and spend more money than we have to stimulate growth, whose bright idea was that?
Keynes I guess, and it's worked quite well for a lot of countries - much depends on the timing.
|
|
|
Post by jamo on Dec 4, 2014 19:44:53 GMT 1
Or we could have the chancellor telling us to borrow more and spend more money than we have to stimulate growth, whose bright idea was that?
You don't half make me smirk Downie. question. How much has Osbourne borrowed in the last 5 years ? How does his borrowing compare with his predecessors? How much does he intend to borrow over the next 5 years if re elected ? Even with your legendary myopic opinions this latest one is pure comedy
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Dec 4, 2014 21:00:41 GMT 1
No I don't think he has done brilliant, and yep the deficit is still there, but it is still half of what it was in 2010, £55billion of tax money paid in interest to creditors to service the debt, hell of a difference to the NHS that do you not think after all the budget is £108Billion for them. if we cut that charge in half and gave that to the NHS I am sure things would seem a lot better.
Or we could have the chancellor telling us to borrow more and spend more money than we have to stimulate growth, whose bright idea was that?
But it would never happen would it Mr D? If the tories had £55 billion going spare they would use it to slash the taxes for their rich and important backers and supporters, an extra tenner a month for plebs like me, few thousand a month extra for their wealthy pals. The NHS wouldn't get a sniff buddy!
|
|
|
Post by lenny on Dec 4, 2014 22:04:42 GMT 1
It is on the mend, though. There's still significant nominal growth and, finally, real growth is starting to kick in (albeit minimally and belatedly). It's not anything like Osborne predicted, but at the moment it's Britain and the US who are growing whilst the other OECD countries struggle to even stagnate. Also, the cuts in spending are necessary - you highlight the size of the deficit, and while it remains so huge, an increase in standard of living is going to be very difficult to instigate. I'm uneasy in saying that it's cast-iron recovery - there's hints of the whole "house of cards" label often applied to the Nazis' economic policy (and, inept though they may be, I'm not for a second comparing our politicians) with the privatisation of the Royal Mail et al. I just don't think, sleazy greaseball though he may be, that Osborne has actually done too badly - by hook or by crook. Fair enough lenny, if that's what you believe. But a return to modest growth doesn't mean the structural problems of our economy have been mended. We're fixated on debt and deficit now because of what's happened since 2007. But it's wrong to think there's no other path. I'm not saying this course is necessarily wrong and, frankly, I'm healthily sceptical towards anyone that claims to know the right way. But I do think we've put ourselves in an unhealthy and damaging position when we limit the national debate by starting from the premise that "the cuts in spending are necessary". A national economy isn't a corner shop, or a household budget. In those terms, governments have always and will always "spend beyond their means". Did you hear Osborne yesterday say we're about to pay off the last of the World War One debt? No mention of the World War Two debt! Nations don't make profits and a budget surplus isn't necessarily the holy grail it's currently being portrayed to be. In fact, you must believe that yourself (perhaps even Downie does too), if you believe Osborne hasn't done too badly. He said there'd be no deficit by now, yet it's £90bn and hardly moved since last year. If that's a Chancellor not doing too badly then perhaps you don't believe the deficit is the be all and end all either! No, of course not - we're merely the pick of a bad bunch at present. And yes, of course a fiscal deficit isn't the be all and end all. I personally think the main problem is that it was at the tipping point of becoming unsustainable - quite similar to how France is doing at present (interesting article in the Economist I recently read on that, I'll see if I can dig it out to add some substance) and so spending to stimulate the economy would have been one hell of a risky strategy. However, the US is the strongest economy by far at present, and their recovery has been based around a manageable debt, almost exclusively with China. Obviously I don't have the knowledge to decide whether one strategy is far more likely to work than another - nobody does, really, even professional economists - but the one chosen, whilst nothing like as successful as Osborne told everybody it would be, has hardly been dreadful. The forecasts he made hang over him, but I'd rather he cocked that up and saved me 2p a pint!
|
|
|
Post by El Presidente on Dec 4, 2014 22:43:53 GMT 1
As always with Osborne's failures, he will put it down to "the mess we were left with by the previous government". I truly hope that he and his chums are soon to be referred to as "the previous government". I found this clip of the Coalition heading out to work...
|
|
|
Post by SeanBroseley on Dec 4, 2014 22:48:54 GMT 1
Employment is at its highest level because the population has grown. As much as 60% of the recovery in UK GDP since the start of the depression has been because of population growth.
The government is in deficit in relation to the private sector.
The private sector is in surplus in relation to the government.
This supports private sector economic activity - which means that more goods and services have been produced to meet people's needs and wants.
The government debt is an asset of the private sector. It provides a safe income stream to the private sector - including pensions.
UK government debt is a safe asset because it is denominated in the currency of which the Bank of England is the monopoly issuer.
The Bank of England is part of the government and a number of guarantees and indemnities exist between the Bank of England and HM Treasury - as shown by the Consolidated Government accounts.
Therefore the UK government can never be forced to default on its debt and does not need to firstly raise tax revenues to meet these obligations.
It's unfortunate if people disagree with this point because it is a simple FACT. Go and hang out with flat earthers and climate change deniers if you can't cope with it.
So the limit to the UK government's expenditure is presented by the availability of goods and services in its own currency area and not by tax revenues or other financial considerations.
Expanding the range and volume of goods and services in the UK should be a goal of the UK government economic policy when the most perishable real resource of the economy goes to waste - labour time.
A key aspect of the UK economy today is the extent of unemployment and underemployment in the economy:
Unemployment among 16-64 year olds stands at 2,476,000. People who have fallen out of the labour market but who want a job: 2,321,000 Working part-time but wanting a full-time job: 1,441,000 Vacancies 531,000
Additionally the number of self-employed people has risen to a 40 year high.
The rise in employment since 2008 has predominately been among the self-employed and over the same period earnings for self-employment has dropped 22%.
The rise in self-employment is not an economic success story but a further manifestation of underemployemnt: it is primarily because of a slowing of the number of people leaving self-employment - despite that 22% income drop.
Unemployment and underemployemnt now just means we produce less than is possible. The sacrifice does not enable us to produce more later. That is what leaves the real burden on future generations.
The austerity programme properly understood is intended to reduce government subsidy for goods that enter the consumption patterns of those mainly dependent on wages and low incomes generally rather than profits (in its various forms) to increase incentives to work harder for the same or less pay, and so reduce the labour content of goods and services produced in the economy to increase profit margins
It uses unemployment as a macroeconomic tool rather than its eradication being a macroeconomic goal.
You can only increase profits in the UK economy as an aggregate by businesses selling more to non-businesses (government and end consumers) and to foreign countries.
And yet:
1) consumers' balance sheet repair - paying down debt - has ceased even though it remains parlous.
2) The government - and the "Opposition" party - intends to progressively force private sector deficits by having a government surplus.
3) Some of our major trading partners are stymied by a flawed currency union and restrictive fiscal rules.
|
|
|
Post by SeanBroseley on Dec 4, 2014 23:00:05 GMT 1
"The government debt is an asset of the private sector" Grade A b******s mon ! Excepting that bought back under quantitative easing of course - I assume that was your point.
|
|
|
Post by SeanBroseley on Dec 4, 2014 23:22:35 GMT 1
When I look at politics in England I just shake me head and wonder what the hell is going on. The Tories and Labour I wouldn't touch with a barge pole which means I'd be looking for a third, an alternative. With the LibDems pretty much done and dusted there simply isn't one. I believe there is a huge opportunity for someone to come in and take full advantage of this complete mess but alas I doubt it will happen. People will vote Tory. People will vote Labour. And so it goes on. Shame that as I wouldn't want either of them running the country. The first paragraph is pretty much where I am at. I wouldn't touch the Tories, Labour, UKIP or LibDems with a barge pole and don't feel an enthusiasm for the Green Party.
|
|
|
Post by El Presidente on Dec 4, 2014 23:23:58 GMT 1
When I look at politics in England I just shake me head and wonder what the hell is going on. The Tories and Labour I wouldn't touch with a barge pole which means I'd be looking for a third, an alternative. With the LibDems pretty much done and dusted there simply isn't one. I believe there is a huge opportunity for someone to come in and take full advantage of this complete mess but alas I doubt it will happen. People will vote Tory. People will vote Labour. And so it goes on. Shame that as I wouldn't want either of them running the country. The first paragraph is pretty much where I am at. I wouldn't touch the Tories, Labour, UKIP or LibDems with a barge pole and don't feel an enthusiasm for the Green Party. Such a shame Lord Sutch passed on...
|
|
|
Post by SeanBroseley on Dec 4, 2014 23:25:54 GMT 1
Excepting that bought back under quantitative easing of course - I assume that was your point.
There are another few issues as identified by CIPFA in this months report, but that is the big feller, yes !
Other than that government debt is a private sector asset. It's held by the private sector and it yields an income. It doesn't fund the Government's expenditure and Government infrastructure is more useful - but I wasn't making either of those points.
|
|
|
Post by SeanBroseley on Dec 4, 2014 23:28:54 GMT 1
Or we could have the chancellor telling us to borrow more and spend more money than we have to stimulate growth, whose bright idea was that?
You don't half make me smirk Downie. question. How much has Osbourne borrowed in the last 5 years ? How does his borrowing compare with his predecessors? How much does he intend to borrow over the next 5 years if re elected ? Even with your legendary myopic opinions this latest one is pure comedy Government borrowing soaks up excess bank (cash) reserves in the economy. Nothing more. The insatiable appetite for government debt is with those who buy it not the government -which has no need for it.
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Dec 5, 2014 1:11:12 GMT 1
He's doing a good job of ****ing us all up.
|
|
|
Post by venceremos on Dec 5, 2014 11:04:52 GMT 1
1) consumers' balance sheet repair - paying down debt - has ceased even though it remains parlous. 2) The government - and the "Opposition" party - intends to progressively force private sector deficits by having a government surplus. From the BBC website this morning - the Telegraph seems to be making Sean's first point and the Independent the second (albeit in a different way): The Independent says plans to achieve a budget surplus by 2020 depend on household debt - in the form of credit card and overdraft borrowing - rising to £360bn over the next five years. If they do not, writes economics editor Ben Chu, "growth would collapse and the government's deficit would, most likely, start increasing again". Yet Fraser Nelson, in the Daily Telegraph, says households "are not binging on debt" and that it's Mr Osborne who's a " debt addict". He writes: "He aims to increase [government] debt by another £200bn but thinks he'll get away with it".The economy requires credit (ie debt). It can be personal or public/taxpayer but there has to be some. The biggest achievement of this government has been to skew the national debate of this point so effectively against the idea of debt that all major parties and most of the media start from the assumption that it must be reduced and the deficit eliminated. As a consequence, the debate is limited to a question of timing - how quickly must we do it? So, credit cards at the ready, let's ramp up our personal debts so we can get that public deficit down! What better time to start than Christmas and look, here's a stamp duty cut to inflate the housing market and get people borrowing more! Anyone paying cash?
|
|
|
Post by lenny on Dec 5, 2014 16:03:39 GMT 1
|
|
|
Post by El Presidente on Dec 5, 2014 16:10:59 GMT 1
1) consumers' balance sheet repair - paying down debt - has ceased even though it remains parlous. 2) The government - and the "Opposition" party - intends to progressively force private sector deficits by having a government surplus. So, credit cards at the ready, let's ramp up our personal debts so we can get that public deficit down! What better time to start than Christmas and look, here's a stamp duty cut to inflate the housing market and get people borrowing more! Anyone paying cash? And this is the confusing thing... For the last 5 years, we've had it rammed down our throats that 'we' were living beyond our means...that the banks leant irresponsibly...that 'we' need to tighten our belts... And seeing as wage rises are s**te, cost of living is up, disposable income is down...we did tighten our belts. And because we've tightened our belts, we're spending less, so the Govt get less VAT, Stamp Duty, etc income...we're paid less, so less to tax... And now the solution is for us all to go on a merry spending spree again... Question time last night, the politicians on the panel were not up for discussing the point the audience kept making ' when are politicians going to start taking some of these cuts' and the interesting proposition from Omid Djalili - let the public vote where the cuts should fall, and what they see as priorities...The three parties just don't get it, their manifestos aren't worth the paper they are written on, and we know it...
|
|
|
Post by The Shropshire Tenor on Dec 5, 2014 16:31:12 GMT 1
It's Mrs Thatchers fault. She used the notion that government debt is the same as household debt as a political slogan and the simplistic idea seems to have lodged firmly with politicians, especially Tories.
It's a conveniently easy idea to sell to the general population, most of whom are economically illiterate - including myself.
Interesting that Osborne is not an economist, his degree is in modern history
|
|