Margaret Thatcher said “Socialist governments always run out of other people’s money. It’s quite a characteristic of them.” In the not too distant past – with a popular Labour Government spending public money on popular th…

Tory lead ‘falls to single figures’
(UKPA) – 14 December 2009
http://www.google.com/hostednews/ukpress/article/ALeqM5hB92zi98c495lBoMPeevWEgNLsZw

Just in case you think I’ve got this all wrong, try Alan Greenspan’s testimony on 24 October 2008 to the US House of Representatives Oversight Committee:

“Those of us who have looked to the self-interest of lending institutions to protect shareholders’ equity, myself included, are in a state of shocked disbelief.”
http://online.wsj.com/article/SB122476545437862295.html

So much for all that cant we’ve heard about the fiduciary responsibilities of the directors of banks and about what’s necessary to maintain the competitiveness of banks.

Btw for years I’ve been posting to blogs saying the claims being made on behalf of free markets are rubbish. Just for starters, the efficient functioning of markets requires a whole infrastructure of laws and regulations and law enforcement agencies to protect property rights. The sensible debate is about what laws, regulations and methods of law enforcement agencies are the most conducive to well functioning economies and to economic growth. We don’t get too much of that from the champions of free markets, do we?

Excuse me, but what decline in British Industry is this?

The Index of Production ( the measurement of output from industry) was at 100 in 2005 and at 80 or so in the 80s. Given that manufacturing output has gone up it’s difficult to say that there’s been a decline really.

A decline in manufacturing employment, yes, a decline in manufacturing as a percentage of the economy, yes, but out put has still been going up.

Salaries for car production workers are higher in Germany than the UK but because they produce higher value products and the productivity is higher, it is worth investing in new technology to create advanced cars .

If the print unions had kept a control on those who could be employed, costs of production would be kept high and it would not have have been worthwhile to invest in the new technology which has reduced the costs of producing newspapers. The print unions failed to realise the new computer controlled printing operations would need electricians and control technicians, not those with compositing skills. The creation of containers reduced the need for dockers. The transfer away from coal to oil and natural gas has reduced the need for colliers and the cretaion of much larger tankers. A 0.5M tonne oil tanker can carry the same amount of energy has tens of colliers probably with the same number of crew. Consequently the number of British seamen and dockyard workers involved with the transport for fuel has declined. The strikes in the shipyards in the 60s and 70s meant when supertankers were first designed , they were built in Japan and Korea and not the UK .

Labour has totally ignored how the development of transistors, silicon chips and PCs has created new industries and greatly reduced the costs of production and the numb ers of unskilled and semi-skilled people employed. Even farming with the development of ever larger tractors has seen reduction in employment over the last 30 years. The development of off-site fabrication with ever larger parts being assembled on construction sites could reduce the number of workers in this sector.

Coal and steel were hampered by overmanning, especially with regard to unskilled and semi-skilled positions, driving up costs. What is left of the British steel industry is competitive. The development of large mines in the USA meant they were able to produce coal cheaply. The British coal mines
were deeper than many others and had other complication which drove up production costs. The development gas fired power stations also reduced the need for coal.

The Left need to realise technology is wave which we need to learn to ride. The Left cannot stop technological evolution, all that can be done is to ensure we have the best education, trained, innovative and agile workforce which can either initiate development or adapt to it faster than any other country. Rupert Murdoch has been far better at harnessing technological evolution for his benefit than the Left in Britain and working class have suffered accordingly.

Does anyone this side of sanity seriously suppose all that is the fault of the Labour government?

For independent assessments of the Pre-Budget Report and the background, try reading the IFS reports:
http://www.ifs.org.uk/projects/314

I like it – the recession in the 80s and 90s were Tory recessions but this one has nothing at all to do with the governing party… hmmmmmm, ok then.

“But the trolls are so up their own arses that they won’t tell you that. They live in a fantasy world where only tories should be allowed to govern. They see any other govt as un British. Tories always believe that they have a divine right to govern.”

Excellent accusing the Tories of arrogance whilst presenting and arrogant generalisation of them. Can’t beat a bit of hypocrisy.

As it happens I have no problem with the idea of a Labour government. What I do have a problem with is a party taking over an economy with 42% debt, a low and reducing deficit and strong growth and turning it into one with 55% debt (as forecast for end of 09-10 in the PBR) and a 12% GDP deficit that only comes down if you get the heroic levels of growth forecast by a party that has long been governing in the party, rather than the national, interest. I do trust you can see the difference there.

The fact is that “monetarism” was formally abandoned as a government policy in the autumn of 1985 – not least because it turned out to be impossible to keep the growth in the money supply within the official targets.

The IMF produced an illuminating obituary on “monetarism” in 1996:

” …instability of monetary demand, especially in the context of supply shocks and declines in potential output growth, complicated the task of monetary authorities. As a result, during the 1980s most central banks – with some notable exceptions – either abandoned or downplayed the role of monetary targets.”
IMF World Economic Outlook, October 1996, p.106.

But it would be wrong to blame all problems of the British economy in the early 1980s on monetarism. Because of North Sea oil, Britain became a net export of oil at a time of relatively high world oil prices – which eventually halved over about 12 months during 1985/6.

As a result of becoming a net oil exporter, the value of the Pound shot up in foreign exchange markets and that made much of British industry uncompetitive against foreign competition when it was already weak because of the 1970s – productivity in several then important sectors, such as the motor industry, steel and coal mining, actualy declined on trend through the 1970s.

Btw the Bundesbank – the “independent” central bank of west Germany – had almost consistently applied a monetarist policy throughout and with much comparative success in controlling inflation there. The big mistake here was in thinking the German model could be applied here when Britain’s financial system was being deregulated.

After monetarism had been abandoned in late 1985, Nigel Lawson, as Chancellor, compounded problems by keeping interest rates too low (!) for too long to maintain a more competitive exchange rate so Britain could enter the European Exchange Rate Mechanism, which we did in October 1990, after Lawson had resigned as Chancellor. The outcome of that was an unsustainable boom, a house-price bubble and resurgent inflation – see @64 above.

But the trolls are so up their own arses that they won’t tell you that. They live in a fantasy world where only tories should be allowed to govern. They see any other govt as un British. Tories always believe that they have a divine right to govern.

As has been pointed out before: Britain has a relatively large financial services (intermediation) sector compared with almost all other affluent economies.

Some working in financial services like to boast about that but the rest of us will have to pay for the consequences of flawed banking practices.

In 2007, the Financial Services Skills Council reported that “Financial services constitutes about 7 percent of total output (GDP)” – try Figure 2 in:
http://www.fssc.org.uk/post16_selcom_response_jan_2007.pdf

This reports that Financial Services together with Business Services contribute 31.2% of Britain’s GDP:
http://news.bbc.co.uk/1/hi/7789844.stm

For an independent assessment of the state of Britain’s public finances before the full onset of the current recession, readers may be interested in this from the IFS a year ago:

The UK Public Finances: ready for the recession?
http://www.ifs.org.uk/bns/bn79.pdf

It’s not about debt, it’s about the deficit. In my personal circumstances I have low debt but if I started spending lots more than I earn I’m really going to be in trouble should I lose my job, whereas if I stick to spending less than I earn I can make some some savings up but more importantly I’m able to cope better with a drop in income.

The fact that we’re even talking about the UK having potential issues in 2-3 years time shows the hole we’re in. This is the UK, one of the largest economies in the world. We shouldn’t ever be in a situation where people doubt our ability to repay our debts yet here we are with very legitimate concerns that if something isn’t done we’re going to have serious problems.

Every country has suffered because of the recession, but ours is one of only a handful being talk about for possible downgrading – doesn’t that tell you that our problems are not exclusively down to the recession?

where most other countries used the decade of sunshine to repair the holes in their roof

*bangs head against wall in absolute disbelief*

But our national debt in 2008 *was lower than that of most of our neighbours*. That’s the whole bloody point, and the reason why the high deficit for 2010 and even 2011 isn’t a vast concern – even at current deficit levels, it’s not until 2012 that UK public *debt* would reach the kind of level where refinancing would be a problem.

But unlike other countries, the hangover from this recession will be with us for far longer. To extend the Tories ‘fixing the roof’ analogy, where most other countries used the decade of sunshine to repair the holes in their roof whereas our government chose to buy lavish new carpets and decorations under the mistaken idea that it would never rain again.

Then along came a storm the likes of which no-one could have foreseen. Widespread floods affected all the houses. But all those who fixed their roof have seen only the contents of the bottom floor ruined where we have had our entire home soaked from top to bottom.

While the culpability of our government is the flooding downstairs is open to debate, the destruction that happened upstairs is absolutely down to them.

I don’t really follow the point of the rest of the post, yes the tories did try out the poll tax on the scots, largely I’d imagine beause it’s a sparsely poppulated quasi automonmous administrative region with very low propoerty values, so why not. The tories did at least admit the poll tax was a mistake (something new labour seem congentially incapable of doing).
Now that Scotland has its own parliament would you care to explain why the rest of the country should subsidise free higher education for them, and free prescriptions for wales ?

More specifically, Andrew Rawnsley is saying Brown and Darling are leading . .

Of course, the fact is that the recent recession has afflicted virtually all the leading OECD economies, including Japan, several of which have sustained greater GDP losses than Britain. To attribute all that to Brown and Darling isn’t credible to any but the most ignorant and gullible readers of the Mail and Telegraph or the dedicated followers of Philip Hammond, the shadow Treasury secretary.

Some of us can vividly recall Nigel Lawson’s screw up as Chancellor in managing the British economy at the end of the 1980s – an unsustainable boom, a house-price bubble, with resurgent inflation and negative equity after the house-price bubble burst, as the result of which the Pound was forced out of the ERM in September 1992. It took until the final quarter of 1995 for Britain’s standardised (ILO) unemployment rate to fall below that of France, Germany or Italy.

Well done Nigel.

http://www.guardian.co.uk/commentisfree/2009/dec/13/andrew-rawnsley-budget-brown-cameron

C’mon. London and the South East regions are net contributors to the national exchequer while Scotland and Wales are net recipients:
http://www.thisislondon.co.uk/news/article-23416323-details/The+REAL+north-south+divide:+South-East+is+'bankrolling'+Britain/article.do

And:

http://www.oef.com/free/pdfs/finance_report(oct07).pdf

It is often overlooked that only 18% of the civil service work in London and only 12% in central London.

If you must know the company I work for is having a re-organisation and around 10% of the jobs at my level are going because, frankly, they don’t need them any more – so no, I haven’t “got mine”. I just work in the real world where cost challenges mean, shock horror, we can’t just employ people for the hell of it.

In terms of the cost to the state, you could give the people you get rid of very good settlements. Job loss doesn’t have to mean ‘being sacked’. Voluntary redundancy could be brought in, along with recruitment freezes to allow natural wastage to reduce the number of state employees. You’d also need a government that was willing to reduce the amount of work that needs to be done by the state (‘cutting bureaucracy’ – so that the less work that needs doing the fewer people you need to do it).

We ought to be implementing as many non-compulsory methods of reducing public sector employee headcount as we can early on.

Shorter troll ……I GOT MINE, FUCK YOU.

And they tell me the tory party has changed. I think not.

Of course, I don’t make Tory policy so you can’t exactly attack them on that – but I think any normal company is able to meet small cost challenges (2% is a very small cost challenge) and the scale of waste in government means this level of cut should be easy to meet without affecting service (if it results in job losses then so be it – it is NOT the role of the state to provide employment).

Oh dear, not that old chestnut. The South East of England gets far higher per person govt spending than Wales or Scotland.

Mind, it is good to see how angry Wales and Scotland have made the English tory. GOOD. You deserve a taste of your own medicine, and as usual the Right can dish it out but not very good at taking it. You thought it was fine to use Scotland as some Thatcher test tube to try out your loony theories . So it is good that Little tory Englanders have got really angry when they have been govt by Scots. Maybe it will encourage English Tories to be a bit more humble in future. (I doubt it though, arrogance is the tory middle name.)

Oh, as for your other idea. Small beer. You will have to do much better than that if you are going to half the debt in less than 4 years.

One thing I don’t understand is why the dodgy dictators benevolent fund, sorry the overseas aid budget, is sacrosanct, and why we signed up to giving yet more money away the day after the PBS

My answer in no way implies that I consider myself to be a “troll” BTW.

Now of course I realise that they only come on here after they have been to troll central for their talking points, and at the moment troll central is not saying how they will cut the debt. So we understand that the poor little darlings are a little lost without guidance from their tory masters. But they must answer the question if they want to be taken seriously.

Their great white dope Osborne says cutting the debt in half in 4 years is not good enough, so where are they going to cut spending? Bearing in mind they are going to give away huge tax cuts in inheritance and share trading, and they are going to spend billions more on defence. Or at least one can only assume that they are going to spend more on defence seeing how many tory armchair generals appear on my TV every night saying we must give the troops more equipment.

Show us the money trolls or STFU.