Deleted
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Post by Deleted on Aug 18, 2024 7:34:06 GMT
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Steve
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Post by Steve on Aug 18, 2024 15:12:14 GMT
When we're spending 5% more than we raise in taxes, when we're over £2.7B in debt (that's ~ £40k for each man, woman and child) and paying over £1,000 a year for each man, woman and child in interest payments alone then even without looking at the ~£2T of household debt, it's obvious that as a Billy No Mates country, some sort of austerity is needed to prevent an economic death spiral.
Yes we can tax the better off and companies more but we're so close to (if not past) the tipping point on that.
So sorry Borg but I will defend what you call austerity
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Post by Deleted on Aug 18, 2024 20:37:38 GMT
^ As a 'Billy No Mates country' with no manners who ignores international law etc and acts arseholic - I thought Sir Keir Knight Of the Realm Starmer was going to rectify that - isn't he busy building bridges with JD Vance and Trump as they expect them to win? Hasn't David Lammy been doing his best suck up routine to Trump and Vance? If what you say is true and he isn't maybe as liked as he thinks he is, maybe it's time to look at who's in charge and the things they're doing wrong to bring it about on themselves?
Yes, of course you will, because you supported David Cameron's coalition government didn't you? [Support austerity that is] - You also supported Tony Blair, which proves another point about how Neoliberal parties are more or less the same
Indeed
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Post by Deleted on Aug 18, 2024 21:31:26 GMT
All defenders of austerity tend to make their defence conditional on somebody other than them getting the financial kicking.
Also, it is to some extent economically simplistic if not economically illiterate. Because reduced spending tends to shrink the economy, increasing welfare costs whilst reducing the tax take, thereby necessitating ever more spending cuts in an economic death spiral. And thus we end up in a nation paying more tax than ever whilst all the services we rely on are chronically underfunded.
Increased spending can grow the economy by more than the costs of that extra spending if the right things are invested in, whilst targeted tax increases on things that inhibit growth or suck investment out of potentially more productive enterprises can potentially raise revenue in ways that are economically beneficial. The last 14 years have surely tested to destruction how economically disastrous austerity has been. The last thing we need is more of it.
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Steve
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Post by Steve on Aug 18, 2024 22:48:22 GMT
All defenders of austerity tend to make their defence conditional on somebody other than them getting the financial kicking. . . Untrue I have consistently said that the austerity of 2010-13 saved the UK but the burden was unfairly on the have nots and the gains disproportionately to the haves. And that Osborne may have said 'we are all in this together' when he actually meant ' YOU are all in this together' and that action was needed then and very much now to reduce the wealth (not the same as income) divide. So like it or not we are very close to a debt interest death spiral and if we fall into that the people that will suffer most will be the have nots. Best we start to live within our means.
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Post by Deleted on Aug 18, 2024 23:09:51 GMT
All defenders of austerity tend to make their defence conditional on somebody other than them getting the financial kicking. . . Untrue I have consistently said that the austerity of 2010-13 saved the UK but the burden was unfairly on the have nots and the gains disproportionately to the haves. And that Osborne may have said 'we are all in this together' when he actually meant ' YOU are all in this together' and that action was needed then and very much now to reduce the wealth (not the same as income) divide. So like it or not we are very close to a debt interest death spiral and if we fall into that the people that will suffer most will be the have nots. Best we start to live within our means. All of which fails to recognise the difference between a simple household budget and a national one. With a household budget you have to live within your means or you go bankrupt. With a national budget, increased spending on the right things can actually increase your means as can increased taxation, but both need to be done cleverly on the right things that boost growth. But that we have all been made worse off by austerity is self evidently obvious, except perhaps for the wealthy few. The Tories giving the poor a kicking is what they always do but it is the worst form of austerity and does the most economic damage. Had it been targeted more at better off elements it might have been less damaging but would still likely have impeded growth and damaged us economically, albeit to a lesser extent. But Tory austerity was always ideologically driven, not necessity driven, with many who voted for it wholly taken in by the simplistic but false household budget comparison.
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Steve
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Post by Steve on Aug 18, 2024 23:21:42 GMT
But that 'throw a £ at the economy and we'll get it back and more in taxes' never works. You only ever get a % back and the rest goes on buying stuff a significant % of which is imported which doesn't actually create UK jobs and worse creates a run on the £ causing inflation which always vests its harm mostly on the poorest.
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Post by vinny on Aug 20, 2024 6:22:37 GMT
Ultimately we need to pay down the national debt and run a budget surplus. That is not easy at this time especially with geopolitical threats requiring us to rebuild our military.
The ideal situation of world peace is not going to happen in our lifetimes and we need our military.
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Post by Deleted on Aug 20, 2024 21:49:13 GMT
But that 'throw a £ at the economy and we'll get it back and more in taxes' never works. You only ever get a % back and the rest goes on buying stuff a significant % of which is imported which doesn't actually create UK jobs and worse creates a run on the £ causing inflation which always vests its harm mostly on the poorest. It really depends upon what any increased spending is paying for. Increased housing construction for example. It is not easy to import housing. Likewise anything that can boost British manufacturing or other home grown industries. Keeping the poor poor in order to stop them buying imports is not the kind of economics that works for the British people.
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Steve
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Post by Steve on Aug 20, 2024 23:23:22 GMT
The way to enduringly cut the numbers of poor is to create more employment.
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Post by Deleted on Aug 21, 2024 13:32:26 GMT
Ultimately we need to pay down the national debt and run a budget surplus. That is not easy at this time especially with geopolitical threats requiring us to rebuild our military. The ideal situation of world peace is not going to happen in our lifetimes and we need our military. Agreed, and that's why austerity won't work. It wasn't going to work back when we needed a strong military in 2010 either, the lack of investments and even cuts to our armed forces caused so many problems it's unreal. Boris cut the armed forces by 10k in 2019 and that's absolutely unacceptable. There's no way that could ever have been a smart political move. The absolute worst thing right now would be austerity when heavy investment in the armed forces is needed, they've already cut public expenditure in other areas and education, pensions, councils can't receive more cuts without doing severe damage to society. Yes, governments in an ideal world should be forced by law to run budget surpluses at all times, they shouldn't even be allowed to go into debt IMHO, but when world war is about to break out that definitely ISN'T the time for pushing the budget surplus stuff on everyone
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Post by brownlow on Aug 21, 2024 16:48:29 GMT
But that 'throw a £ at the economy and we'll get it back and more in taxes' never works. You only ever get a % back and the rest goes on buying stuff a significant % of which is imported which doesn't actually create UK jobs and worse creates a run on the £ causing inflation which always vests its harm mostly on the poorest. You don't need to get it back in tax, you need to get no less back as national income (GDP) so that your debt to GDP ratio doesn't increase . GDP = C + I + G + X-M where G = govt spending (except transfers such as welfare payments). It's a component of - not something subtracted from - national income. People struggle with this because they think the same doctors treating the same patients; the same teachers teaching the same pupils etc; in the private sector adds to GDP, but is subtracted from GDP in the public sector. Like their own spending is subtracted from their income. The common confusion of macroeconomics with a household budget. You and I can save our way out of debt, but the economy cannot, because "saving" reduces total income by the same amount. In the economy as a whole, total spending = total income (± net exports, X-M in GDP), since one man's spending is another's income. It's why austerity doesn't work. Next, you ask, why can't we just spend our way to infinite GDP? The answer is, of course, INFLATION. We should assess public spending proposals on their potential to cause inflation - not the govt's fiscal "deficit". The govt does not need to balance its budget, it needs to balance the economy, and can never run out of its own currency.
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Post by brownlow on Aug 21, 2024 17:13:40 GMT
Yes, governments in an ideal world should be forced by law to run budget surpluses at all times, they shouldn't even be allowed to go into debt
Sounds sensible, but impossible. For any country to have a trade surplus, other countries must have corresponding trade deficits, as a matter of arithmetic. If countries with trade deficts try to run govt surpluses (spend less into their economies than they tax out), they force their domestic private sectors (households and firms) into deficit. That is, they either reduce the money supply, or force households and firms to take on credit - IOW private debt - in order to maintain production and consumption. That's why nearly all countries, including most rich ones, run nearly permanent govt deficts. And have done for centuries.
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Post by Deleted on Aug 21, 2024 17:28:59 GMT
The best run countries in the world with highest GDP per capita do have budget surpluses, it's already a fact for them. It's a fact that they are economic powerhouses too, so it already does exist and isn't impossible in the slightest
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Steve
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Post by Steve on Aug 21, 2024 17:47:44 GMT
But that 'throw a £ at the economy and we'll get it back and more in taxes' never works. You only ever get a % back and the rest goes on buying stuff a significant % of which is imported which doesn't actually create UK jobs and worse creates a run on the £ causing inflation which always vests its harm mostly on the poorest. You don't need to get it back in tax, you need to get no less back as national income (GDP) so that your debt to GDP ratio doesn't increase . GDP = C + I + G + X-M where G = govt spending (except transfers such as welfare payments). It's a component of - not something subtracted from - national income. People struggle with this because they think the same doctors treating the same patients; the same teachers teaching the same pupils etc; in the private sector adds to GDP, but is subtracted from GDP in the public sector. Like their own spending is subtracted from their income. The common confusion of macroeconomics with a household budget. You and I can save our way out of debt, but the economy cannot, because "saving" reduces total income by the same amount. In the economy as a whole, total spending = total income (± net exports, X-M in GDP), since one man's spending is another's income. It's why austerity doesn't work. Next, you ask, why can't we just spend our way to infinite GDP? The answer is, of course, INFLATION. We should assess public spending proposals on their potential to cause inflation - not the govt's fiscal "deficit". The govt does not need to balance its budget, it needs to balance the economy, and can never run out of its own currency. This article on the matter seems relevant www.econlib.org/library/Topics/Details/aggregatedemand.htmlThe crux is going to be how much increasing net government spend benefits GDP after considering how much of the spend increases 'M' and the further indirect impacts on interest rates and domestic production. Just assuming it'll all be wonderfully fine as per Truss/Kwartangonomics is reckless.
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