Why I’ll be joining the right-wing Rally Against Debt


by Sunny Hundal    
9:05 am - April 4th 2011

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Various Tory and UKIP bloggers are organising a ‘Rally Against Debt’ in May. Right-wing luminaries such as Daniel Hannan MEP, who confidently predicted the rise of the UK Tea Party last year, is praising it too – presumably in hope his dreams will still be realised.

I would urge the organisers not to be put off by the fact it will be around a 1000 times smaller than 26th March. In fact, I’m going to join them, and I think other lefties should do!

To start with the obvious, who says lefties are for debt? There’s no ideological impetus for it. In fact, if we look at centre-left governments in the UK and USA, they prove my point. It was Ronald Reagan and George W Bush who pushed up US debt massively over the last 40 years. National debt in the UK in 2008 (when the biggest financial crisis since the 1930s hit) was lower than it was in 1997.

But I think there’s a better reason for attending the Rally Against Debt: George Osborne’s budget will actually push up our debt.

Weren’t Conservatives moaning just recently about how Brown had ‘maxed out the credit card’, and was ‘passing on massive debt to future generations’?

Odd then, that they seem to be so quiet about the Office of Budget Responsibility’s predictions that household debt will rise by a staggering £566 billion over the next four years?

Worse, nearly half of that projected rise in household debt (£245 billion) was added to the government’s projections after Osborne’s Budget in June last year.

This illustrates the key difference between the left and the right on the economy: we both want to cut debt and grow the economy, but lefties say Osborne’s plans are pushing the economy further into jeopardy.

Consumer confidence is taking a huge knock, businesses aren’t investing, mortgage defaults have jumped “unexpectedly”, businesses are increasingly defaulting and real wages are predicted to fall along with living standards.

The left alternative is that we keep the economy afloat through this massive credit crunch through investment, so that households don’t face unemployment and rising debt, and the economy recovers much faster. Then we can deal with the national debt once the economy has sufficiently recovered.

But George Osborne is hoping the government will eliminate its debt thanks to households taking on more debt. He wants households to further ‘max out their credit card’.

Clearly, we cannot allow this to stand. I would implore others to join me at the Rally Against Debt and point out how Osborne’s policies will increase it. I hope principled right-wingers will join me in doing so too.

Also, see this by Dan Frost: Why Labour should hijack #RallyAgainstDebt

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About the author
Sunny Hundal is editor of LC. Also: on Twitter, at Pickled Politics and Guardian CIF.
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Reader comments


1. Lisa Ansell

”Odd then, that they seem to be so quiet about the Office of Budget Responsibility’s predictions that household debt will rise by a staggering £566 billion over the next four years?”

Sunny, would you like to draw my attention to where Ed Miliband is talking about the levels of personal debt in the country? You were aware that Labour’s economic policy requires an expansion of personal debt as well? Both Labour and the Conservatives recovery depends on that expansion within our credit market- there is no other way for families to make up for the loss in income when wages are driven downwards and welfare subsidy is cut. That said with a frozen credit market- many of those who look to credit will find there are few options available. Not to mention that when you assess the current personal debt level against wages and house prices- there is the possibility that people are actually maxed out and it isn’t just that banks aren’t lending.

Well done on joining up with UKIP, the taxpayers alliance and er Daniel Hannan though. Am definitely sure this is a good move for you!

If you have a squeezed middle who are welfare dependent and/or in debt- and you are cutting services, welfare spending, and transferring publicly owned assets to the private sector- then yes families have to find that somewhere. And the only way Labour or the coalition’s (almost identical)economic and social policies can be carried out is by expanding private debt. Sorry to burst your bubble.

A critique – where from right or left – need not feed into partisan support for a political platform. Consumer-led growth is leading us into ecological destruction; whether it saves us from a recession along the way is a small fry concern by comparison. Debt as a way of life exacerbates the exploitative nature of the economy, also. What little pay is delivered to the worker once the surplus value is skimmed off the top increasingly ends up paying for interest on debt, directly or indirectly. We should not cede the outrage over this to the Right – it’s natural territory for the Left.

3. Lisa Ansell

But Joshua- how does a ‘a well mannered, polite rally for civilised people who don’t wish to see their hard earned money being spent on pointless government initiatives and instead would like government spending to actually fall and our national debt to be cut.’- address the issue of private debt? Anti-debt in this context is not about consumer debt- it’s about the deficit. And the moves to cut the deficit are precisely what the OBR have shown will cause levels of household debt(which are already at a point where they are a more significant risk to our economy than the deficit).

Am confused as to how it is believed that a right wing philosophy of cutting public spending, transferring public assets to private hands- and removing other state subsidy- in order to promote growth that depends entirely on private debt and expansion of the credit market- at the expense of the public sector, manufacturing and small medium sized enterprises- does anything but increase personal private debt?

In principle, I don’t think there is anything wrong with borrowing to invest, nor borrowing to cover short term difficulties – but only if the debt is then repaid within the time-frame applicable to the benefit the debt spending caused.

For example, borrowing to improve education is warranted, if the cost of that debt is repaid by the time the educated stop paying taxes that can be used to repay the debt incurred.

Likewise, borrowing to keep the economy stable during a recession is wise, but again, only if the debt is repaid by the time the economic benefits of that spending start to fade.

What is the long term benefit of borrowing to keep someone in employment today – and how long will it take for them to repay the costs associated with that?

I don’t know – and I can’t seem to find out. Has anyone even asked?

Then ask, what plans do the governments and opposition parties have to ensure that the debt is repaid before its benefit wears out? I am not seeing any of that from anyone.

Indeed, neither party is expecting the debt to stabilise, or even start being repaid for 5-10 years at a minimum. Is the benefit of keeping someone in work today really going to be impacting the economy in 10 or more years time?

What we are essentially doing is borrowing today to keep our lifestyles tolerably pleasant, then expecting the next generation to repay that debt. I’m not really sure that is a good idea.

It would be wonderful if we could subvert this whole event. “Growth, not cuts!”, “Students against debt!”, “Keynes, not Hayek!”

You trollin’ right? This is some kind of amazing info jamming isn’t it? This is some post-post-modern Baudrillard’s The Gulf War Did Not Take Place thing designed to spin people on the non-liberal left (also known as the actual left, you know people with systematic critiques of society and capitalism) into a place of such information distortion that they will explode or just give up and start running hedge funds thus giving the Labour party a smooth path to power and ‘cuts, but slower, neoliberalism but nicer, capital power but friendly’? Truly you are the Julian Assange of the liberal left.

7. Lisa Ansell

Oh bloody hell- have just realised. Sunny- you don’t actually realise that the ‘Rally Against Debt’ is a pro-cuts rally do you? It is a rally against public debt- ie the deficit. Demanding cuts to sort it.

http://www.facebook.com/pages/Rally-Against-Debt/215405205140114?sk=wall#!/pages/Rally-Against-Debt/215405205140114

http://rallyagainstdebt.org/

http://blogs.telegraph.co.uk/news/edwest/100081931/join-us-for-the-rally-against-debt-on-may-14/

“Odd then, that they [conservatives] seem to be so quiet about the Office of Budget Responsibility’s predictions that household debt will rise by a staggering £566 billion over the next four years?”

Don’t you ever read our blogs, Sunny? We talk of little else!

This is the difference between right-wingers, who want to prattle on about the benefits of the market and those who realize that massive state interventtion and spending is actually more beneficial to business than those who receive the benefit. Whether it is a direct welfare benefit or a job in the publicv sector.
And lefties are divided along the same lines as the right, dependant on where on the left you stand,

Goodness, it looks like @8 really is a visit from Dan, Dan the Oratory Man!

More seriously, Sunny, this may be titled a rally against debt, but it is equally *for* public spending cuts. That, presumably, is yet more cuts on top of those already being enacted by the present Government.

If the so-called Taxpayers’ Alliance is going, that is as good a reason as any not to touch it with your worst enemy’s longest bargepole. Not to mention the presence of the MEP and occasional Tory who went to the States just so he could bad-mouth the NHS on Fox News Channel (fair and balanced my arse).

11. Keynes West

To those of you explaining to Sunny that this is a pro-cuts demo, I suspect he already knows that. I think it’s a great idea using the rally to show why right-wing fundamentalism will simply lead to more debt.

12. Marko Pollo

Sunny

Showing a graph of % of GDP is misleading – when public spending goes up GDP is likely to go up artificially

check out

http://www.ukpublicspending.co.uk/downchart_ukgs.php?year=1995_2010&state=UK&view=1&expand=&units=b&fy=2010&chart=G0-total&bar=0&stack=1&size=l&color=c&title=

which is debt in cash terms

That’s GROSS household debt, not NET.

NET household debt is falling…and the savings rate increasing.

So you aren’t quite right on the gist of your argument there Sunny…

14. Keynes West

Marko Pollo: To see how meaningless it is to look at the debt in cash terms, try a bigger date range

http://www.ukpublicspending.co.uk/downchart_ukgs.php?year=1900_2010&state=UK&view=1&expand=&units=b&fy=2010&chart=G0-total&bar=0&stack=1&size=l&color=c&title=

Sure the right edge looks even higher – which is presumably why you prefer this measure – but WW1 and WW2 become tiny blips!

Well, I won’t be joining them Sunny. Never appease brown shirts.

8 You are paid for by the tax payer, get back to work and stop pissing about on the net.

Well, I won’t be joining them Sunny. Never appease brown shirts.

Come on Brown has gone now he is hiding in Scotland, all the shirt are changing we are being told to a mild colour pink with a blue tinge.

18. Duncan Weldon

Tyler @13,

OBR forecast is for the savings ratio to fall to 3.4% (half 50yr average) and stay there.

They forecast that consumption will grow quicker than disposable household income in 4 of the next five years.

Consumption provides 40% of growth in their forecast to 2015 and it’s premised on falling savings.

Blogged today:

http://duncanseconomicblog.wordpress.com/2011/04/04/the-household-savings-ratio-is-now-key/

@6 – “You trollin’ right?”

Your response is one of the best I’ve ever read on this site.

I seriously hope this article is a (very bad) very late April Fools’ Day joke, but somehow I doubt it… “Information distortion” is the understatement of the year. I suppose the only question that remains is how long until the whole system implodes under the strain of its own absurdity?

Perhaps the right wingers can take their mate Jeremy Clarkson with them on the march. On second thoughts……… he has got problems of his own today.

Just another middle aged, male, right wing hypocrite.

No.

You’ve all missed the point.

This is a carefully coded message to lefties to join the rally with the aim of disrupting it.

Sunny has just over-encrypted.

Glad to be of help……..

22. Luis Enrique

everybody is weird about debt, imho. Right wingers and borderline demented about it, and plenty of left-wingers don’t give it a thought; too few regard it merely as something any benign sane government needs to keep an eye on.

and household debt, everybody is always so certain it’s a bad thing … nobody here* knows the composition of that debt, whether it’s rich households or what. Some lefties think capitalist economies cannot grow without debt: I don’t know about that, but it’s not surprising to see gross debt grow in absolute terms when the economy does. Duncan at 18 tells us the OBR is expecting debt-funded consumption growth. Even this is hard to interpret. After a period of de-leveraging maybe some bounce-back is perfectly normal. And let’s not forget the unreliability of economic forecasts.

Of course I can see how this might be a bad thing – if that increase in debt is largely explained by poor households with falling real incomes borrowing to sustain consumption levels – but has anybody here stopped to think that might not be what’s going on?** The economy is a big thing and lots of things can move household debt other than that.

a question to those worried about household debt amongst poor households: would you support legislation to deny credit to poor households? I know the first-best solution is to end (relative) poverty, but on basis that might take Milliband into his second term (or Lucas?), in the meantime, how would you reduce debt in poor households. Note that offering lower-interest loans from a people’s bank would increase, not decrease, debt, unless credit is rationed.

* Duncan the possible exception
** perhaps I’m the fool for doubting it

23. UKDebtRally

Follow us at twitter.com/ukdebtrally. End debt, march on 14th May.

24. Planeshift

“would you support legislation to deny credit to poor households?”

No, because the usual result of that is loan sharks.

What instead is needed is financial education and inclusion. So people are aware of the difference between good debt and bad debt, understand the concept of interest rates (believe it or not there are still people who think a credit card with 17% apr is better than a 9% one), what mechanisms are available to help with debt if you do fuck up, and also about basic financial management including getting a basic bank account. There also needs to be better pricing transparency in the industry and clearer guidelines on dealing with vulnerable people.

Rest of your post Luis is spot on. If household debt increases because people are just putting food on the credit card then this is a bad thing, if it is the result of people doing things like getting an affordable mortgage, buying a reliable car so they can get to work etc, then there is no problem with this. We need more information.

I’m intrigued by this post. Do people think these cuts are some kind of game?

Instead of farting about at this rally and trying to out-stunt rightwing pisswits, how about everyone ships up to Lancashire for the day and asks the Tories there why they’re using public money to brag about spending £294m on roads and building while introducing charging for social care?

http://www.hangbitching.com/2011/03/lancashire-cuts-from-next-week/

This “let’s have some fun making assholes of ourselves at a rightwing rally, while being amazingly and amusingly ironic” stuff really is male legcocking at its best. If it has a best, that is.

Jesus wept. And people call me childish.

The End debt march on 14th May is really a pro cuts march.

Rich middle class people who want the poor to suffer even more than they are now.

Well said KATE.

It is a brownshirt pro cuts rally.

Thank you, Sally. I know we haven’t always seen eye to eye, but we are as one on this.

I’m sitting here having this fantasy where I castrate lefty males who attend with my teeth.

This is a pisstake, right? Right? Please God, let this be a joke I’ve missed.

honestly, i think the best that we entirely ignore this sort of thing, i think it will be badly attended and any controversy may lead to publicity for their cause!

What is the point of them having a march anyway, what’s it going to achieve? Are the poor not being hurt enough for them? How do they expect the government to cut the deficit faster, are they willing to pay higher taxes? Considering the Tax Payer’s Alliance are involved, I doubt it.

And I read their website with comments like this: “this rally doesn’t enjoy the thousands of full time staff and millions of pounds in grants that unions do at taxpayers’ expense, it is always harder to get people out in the national interest rather than to defend their own pay and perks, and it is a relatively quick grassroots response that hasn’t been in planning for nearly as long”, I certainly don’t think we should be going. Cheeky beggars. My father is self-employed and has been for about three years now, yet we went on the TUC march.

I don’t think it’s helpful to conflate the deficit and debt. Some people seem to be under the impression that if we balance the budget over a few years then the whole problem goes away.

It’s not obvious to me why 1) Not letting the Tories define the debate on debt and 2) making the case that their policies will make the debt worse and harm the things we care about is bad – let alone ‘legcocky’.

@29 – as far as I’m aware, yes, this is a pisstake. I mean, it’s definitely a pisstake of the Rally Against Debt. And if lefties went, it would be to take the piss. Not sure if the suggestion that lefties should go is a pisstake in itself though.

More importantly – what is ‘legcocking’?

To those of you explaining to Sunny that this is a pro-cuts demo, I suspect he already knows that. I think it’s a great idea using the rally to show why right-wing fundamentalism will simply lead to more debt.

I’m amazed that someone has to spell this out.
Some lefties have the capacity to miss the point so overwhelmingly that they may as well be reading something else while commenting on blogs randomly.

Daniel Hannan – you say that, but I’ve just scrolled through the last two pages of your blog and not seen personal debt levels mentioned once. Could you point to a few posts?

35. Richard W

It sounds like a swivel-eyed convention. Sunny, you will come back ranting and preaching to all the sundry about the evil of central banks and quoting Rothbard to all who will listen.

a question to those worried about household debt amongst poor households: would you support legislation to deny credit to poor households?

What, so they can go further into unmanageable debt? That’s absurd. The response should be to find ways of easing their pain not making it worse.

Kate/Sally/Caroline/Jasmine etc

What happened to women’s intuition? You have to read between the lines not what they actually say………..

It’s obvious that Sunny, and other leftists, will be about as welcome at a right wing monetarist rally as a black man at a Klu Klux Klan meeting. The only possible aim is to cause trouble.

No doubt the SWP are on red alert already.

38. Lisa Ansell

Kate- you missed the memo. The anti-cuts movement is essential for our politcial commenters because without it you can’t get the badge for your ‘I’m a lefty sticker book’

Your idea about rocking up to Lancashire is divisive and pointless. a) because all lefties live in London-what possible concern could there be up north? b) because the service user group affected are losers, who should be constructive and not discuss the political consensus that has ensured they are first hit in case it undermines the party leading the charge of the anti-cuts movement. c) if they really gave a shit about their services, they would be posting on Liberal Conspiracy or other political blogs and would have been out leafletting to get people to attend Saturday’s march like the Labour activists who are busy ‘fighting’ the mean old tories.

Besides Kate? What are the political affiliations of these people? What if they demand something outside Labour’s manifesto? Are they anarcho syndicalists? Marxists? Are they actually bonafide lefties? Are they trots and radicals? You haven’t thought this through. Do they have ideological direction? Typical of your childish approach to discussion of this issue.

Besides- attending a march to subvert the message can often be very useful.

All those ESA Claimants, housing benefit claimants, disabled people, young people, social care workers, service users, and social workers who thought they could use this weekends march to show how opposed to the cuts that affect them were very helpful.

They added weight to the message that people want Labour as an alternative to the Conservatives- and their hardluck stories backed up the narrative that the tories are mean. And now they have had their day in the sun, the political consensus that means they were first to be targetted can continue- and while they figure out how to get out of bed, or get to the shops without the carers that allowed them to do so- they can sit safe in the knowledge that the anti-cuts ‘movement’ thought they were good for soomething. For a minute or so.

Now if you could stop with your dramatic, hyperbolic descriptions of what the cuts will do- and get back the serious business of pointscoring, frothing, and furthering the career of commenters and strategists who know best. We all need to find hats, so we can go off and stand with the British Tea Party. Just to subvert the message……

39. Lisa Ansell

Sunny- if you wanted to take a moment to explain how labour cutting services and welfare benefits won’t increase household debt, would be very grateful.

40. Richard W

@ Pagar

They are not monetarists as monetarism is based on the long-run neutrality of money.

Ahhh, the SWP. My mother joined after she got kicked out the Labour party. They’re nice people and put on good conferences but they’re all about the trolling. They’d protest a children’s birthday party if they thought they’d get a tutting article in the Daily Mail or wind up some Tories.

Ah, so you decided to do this post in the end =P

Here’s my one on the same topic from a few days back =]
http://danieljfrost.blogspot.com/2011/04/why-labour-should-hijack.html

Heh – sorry Dan I should have linked yours too, as its spot on. I’ll amend that now.

44. Luis Enrique

I should have been clear in 22 – in the first case I was talking about government debt.

I shouldn’t have asked that question about denying credit to poor households: there’s no reason to think people who are dismayed at debt levels amongst poor households would thinking reducing credit availability is the answer. I don’t really understand your response at 36 Sunny, I don’t know how people get further into debt when credit supply is reduced, unless you are talking about those who would turn to loan sharks.

Thanks, Sunny!

46. Chaise Guevara

@ 28 Kate Belgrave

“I’m sitting here having this fantasy where I castrate lefty males who attend with my teeth.”

Charming. What has gender even got to do with this?

You’re absolutely right. I find it hilarious that the right is now ‘against debt’. Since debt is virtually the only ‘product’ of the banking industry, they must be against the banking industry too.

@ Chaise

What has gender even got to do with this?

Don’t you know that FGM is rather frowned upon?

Keep up.

@11 Thats the best name ever! Did you make that one up?

@Sunny (34)
This was my most recent attack (of many) on debt levels under the current government. We are borrowing more now than we were under Gordon Brown:

http://blogs.telegraph.co.uk/news/danielhannan/100080903/taxes-up-borrowing-up-inflation-up/

51. Luis Enrique

I know nobody is really interested in points like this, but hey ho: it’s a perfectly consistent position to think that government debt is dangerously high, but think household debt can grow without cause for concern. This “oh, I thought you were against debt” argument doesn’t have much weight.

Luis: , I don’t know how people get further into debt when credit supply is reduced, unless you are talking about those who would turn to loan sharks.

Well, yes, many do.

Sally: “Well, I won’t be joining them Sunny. Never appease brown shirts.”

Oh, yes – well done. When you don’t have any coherent argument to make, just compare your enemy to Nazis. Nevermind that the Nazis wanted a large, all-encompassing state, whereas the people in favour of thprotest want a small one which spends within its limits. Ignoring facts and making comparisons to Nazis means you win the debate.

Sally: “Rich middle class people who want the poor to suffer even more than they are now.”

Interesting. I come from a working class background. I’m a student. My Dad’s a mechanic, my Mum’s a part-time cleaner. But rather than swallowing your silly leftist nonsense, I recognise that it’s immoral to take taxes from people to spend £50bn a year on paying debt interest. Paying debt interest is going to be the fourth-largest expenditure this year, coming above: public order and safety, housing and environment, industry agriculture and employment, defence, and personal social services. If you value public services, you’d want that £50bn spent on improving services, not paying off debt.

Stop trying to paint it as this simplistic moral left vs immoral right. I think it’s immoral for governments to consistently run a deficit, thereby increasing debt which is going to have to be paid of by future taxpayers for years to come.

Will anyone else join me under a banner reading “The Other Rally Against Debt” – the demands of which are:

– No to the cuts which look set to increase household debt over the next four years

– No to the most vulnerable in society bearing the burden of city risk and failure

– No to national debt fetishization – many countries run at a budget deficit and survive just fine, including the UK. It is a myth to suppose that if all countries ran at budget surpluses like Norway then the world would be a better place, and wealth decentralised.

– Yes to the consumer credit act which seeks to roll out more low interest credit unions where legal and illegal loan sharks have profited from high rates of personal debt, particularly since the start of the recession

– Yes to sensible debt management that rejects the notion that cutting the deficit as quickly as possible, at the expense of jobs, growth and services, is the best thing to do for jobs, growth and services.

Carl – let’s do it! :)

Daniel Hannan – that doesn’t say anything about personal debt.

We expect the comment @23 to be deleted immediately. They aren’t part of the Rally Against Debt, they are shysters.

Thank you for advertising our rally Sunny. We expect to draw people in from all over the UK, not just London. Please look out for details of coaches available.

57. Chaise Guevara

@ 53 Bradley

“I think it’s immoral for governments to consistently run a deficit, thereby increasing debt which is going to have to be paid of by future taxpayers for years to come.”

Debt has been used very irresponsibly. But in theory, are you ok with debt generated to create services that those later generations will be able to use – borrowing money to improve the national rail nework, for example?

Might be fun to turn up & point & laugh at the idiocy of it all. The government is cutting many services which when running properly actually save it money. For instance, women’s shelters & rape crisis centres. There’s one closing which costs only slightly more than the cost to the State in medical expenses, legal expenses, lost time at work etc etc of 1 rape. If that centre prevents 2 rapes in a year it’s paid for itself, yet the government are too blind to see. They’re going to cut all over the shop, and we’ll see the deficit go up, not down. People are going to end up dead through this government’s mis-management.

59. johnPReid

Charming. What has gender even got to do with this

I’m sure fantasizing about clitarus castration by using your teeth, for left wing women who go to cut the debt marches ,would be possible to,

Capitalists against debt?

This is going to be the stupidest march in history.

“What do we want? …… Less debt” ……. “When do we want it?….when we are buying a house”

Oh wait……….

61. Cheesy Monkey

Wouldn’t hijacking a march be seen as a bit trivial? The Right would paint you as undemocratic. Besides, the media would ignore you, pointing out the increased turnout…

Instead, do one or more of the following:

1) Stage a counter-demonstration. Unlikely you could have it on the same day in London, but why not somewhere more central? This would be about the numbers present, not the significance of the location—i.e., if you can get more people to Birmingham, Manchester, or, say, Cardiff than the other lot can bring to London, that would be a powerful message that this Government’s actions are more unpopular than popular

2) Send a couple of observers on this March for Cuts. They’re not there to interfere in any way, just to take some pictures showing the size of the turnout. I’ve got a feeling this may be the only march in history where the police and the press inflate the figures

3) If the rally is in Hyde Park, then attempt to occupy it by staging a five-a-side football tournament, traditional school sports day activities, an open air orchestra, live theatre or an impromptu dog show. Anything that takes space. Think of something

Let them have their day in the rain. It may well be a gift to the anti-cuts movement.

@57. Chaise Guevara

Interesting question.
Probably not. I think borrowing money should be avoided as far as possible, and would rather that a government built up a surplus and then used some of it for investment rather than borrowing the funds.I’d be wary of a government going into debt to invest in services on the assumption that future generations will want those services, since we just can’t predict whether they would approve of it.

Too often the debt our governments have generated is for short-term political gain and to benefit the current generation, with little thought for those in future who will have to have part of their taxes spent on paying back the borrowed money of past politicians. I’d also suggest that the risks of running deficits have now been shown. If there had been a surplus at the time of the financial crisis, those funds could have been drawn upon for part of the bank bailout and stimulus. Instead, the government had to borrow large amounts of money, thereby sharply increasing our deficit and necessitating spending cuts. Therefore, however well-intentioned a government may be, I think it’s best in the long term to avoid debt and to instead seek to build up surpluses to act as security for the future and reserves for spending. The desire for surpluses isn’t a preserve of what some here may characterise as the loony right wing. We only have to look to Bill Clinton as an example of a liberal who recognised the value of running surpluses.

@62 Bradley,

You’re treating household debt and government debt as if they’re the same sort of thing, they’re not at all. Government ‘debt’ is the issuance of bonds to match £-for-£ government spending; it is, in fact, not necessary – the same economic effect could be achieved by other means, and it does not finance government spending (neither does taxation, btw).

If the government runs a surplus, this means that the non-government sectors (external and domestic-private), by definition, run a deficit on aggregate. If, like the UK, you are a net importer (external surplus) then this leaves the domestic private sector in deficit, i.e. an expansion of private debt. Just as happened in the 90s; you should perhaps stop imagining Clinton to be a liberal.

As far future generations go, barring a governmental bollock-dropping of monumental proportions (y’know, like deliberately causing aggregate demand to contract during a recession) a government that is sovereign in its currency, like the UK, will *always* be able to meet its obligations with no implications for future taxation levels.

“2) Send a couple of observers on this March for Cuts. They’re not there to interfere in any way, just to take some pictures showing the size of the turnout. I’ve got a feeling this may be the only march in history where the police and the press inflate the figures”

It’s easy to have a huge “grassroots” protest if the TUC organises it, the mainstream media publicises it, and the whole thing is centred on a narrative of “cuts” whose simplicity is matched only by its mendacity.

But you are correct, this is why the whole thing is bound to look a bit silly. Protesting is not for the Right. The most we can do is annoy you guys. Even if we somehow succeeded in organising a huge Tea Party-sized protest, which is most unlikely, it would only provide motivation for your future efforts. Which, I am sure, will be even larger than the TUC rally.

Sunny – the thing about the debt in 1996-97 is that although it was 42.5% GDP, it fell for the next 5 years down to 29.7% in 2001-02. No-one would be complaining if that were the case now. But of course it isn’t. The case now is that debt in 2008-09 was 44% GDP but is forecast to rise to 69.7% GDP in 2012-13 (this was 73% in Darling’s last budget).

The trajectory of government debt is completely different, which is why comparisons about debt being lower in 1997 are so flawed. It’s like comparing a car that’s 1 metre from a wall but stopped to one that’s 3 metres away travelling towards it at 70 MPH.

@63

‘a government that is sovereign in its currency, like the UK, will *always* be able to meet its obligations with no implications for future taxation levels’

I am curious about this. Do you mean by printing money? If so there are rather unfortunate consequences, although it will indeed be for the current generation rather than future taxpayers which is fairer, though not good for those of us who have been prudent in our finances.

Let’s spell things out again just to be clear;

Sunny and Duncan Weldon are not distinguishing between GROSS household debt and TOTAL household debt.

GROSS debt, described above, includes factors such as population growth and secured lending (mortgages). GROSS debt is almost always likely to increasse as population increases and more housing stock is built and then sold.

NET debt doesn’t. As the BOE figures show (available on bloomberg or from the BOE monthly) NET credit extension is at a 10y low. Household savings rates have also recovered somewhat (lates 5.4%, source ONS).

Government deficits are also falling slowly, and the coalition aims to remove the deficit by 2015 as we all know.

A classic Keynesian argument would say that with reduced government spending (though in real terms the cuts are only 3% lets not forget), household NET debt not increasing to cover the same gap and household savings not being reduced by the same amount either you can’t have any GDP growth, as consumption/spending will fall.

This of course is a total fallacy. Productivity can increase, and however politically unappealing it might be, the rate of increase in living standards might fall.

All this debt we’ve already accumulated has been used to increase our living standards at an artificically fast pace, and simply put, people are going to be squeezed as they have to pay off debt and save for old age. It *doesn’t* mean we are going to have a recession, but it does mean things might be tougher for a while as we return our debt metrics to a more sustainable footing.

Why do no Keynesian economists ever discuss the damage too much debt (and the interest payments on them) can cause to GDP growth….after all, by their own definition, they reduce spending??

Send the Black Bloc …n have yourselves a mash up : )

69. The Fyrdman

This isn’t a Tory/UKIP rally. Yes, Tories and UKippers will be there in force, they read anti-debt material regularly so are a primed market. But the rally itself is none partisan. As the people setting this up state, this is a rally for those who want to see the deficit eliminated and debt shrink. Our current interest payments to service the debt are larger than the education budget. This IS something those both left and right should be united on. I may want a small state and minimal interference and the left, well, want to tell everyone how to go about their lives. However what we can both agree on is that spending over £60billion a year on interest is money down the drain.

70. Chaise Guevara

69. The Fyrdman

For someone apparently trying to bridge the gap between left and right, it was probably unwise to say something like “the left, well, want to tell everyone how to go about their lives”. Also inaccurate. Which side of the political divide has historically wanted to dictate to people who they should be allowed to sleep with, which religions are acceptable, which narcotic substances they should be allowed to imbibe? I’ll give you a clue: it’s not the left.

For someone apparently trying to bridge the gap between left and right, it was probably unwise to say something like “the left, well, want to tell everyone how to go about their lives”. Also inaccurate.

Good point, Chaise, though he did seem to be trying hard to find something nice to say.

In fact, he should have said the statist government politicians and their paid for busybody lackeys.

Oh yes, and the opposition politicians and their paid for busybody lackeys.

Do you see, it’s not left/right issue at all.

I am both stunned and appalled that anyone purporting to be a socialist should even consider supporting such an outrageous notion as joining a Tory ‘demo’ to support the cuts. It is preposterous. These people are quite happy to watch unemployment rise, see our Sure Start centres close and stand idly by whilst the most financially deprived in our society watch their benefits get cut.

All this so we can stride around London in our jodphurs, chanting “Tally ho, chaps” and making derisory comments about Gordon Brown’s stewardship of our coffers as Chancellor and his time later as leader. This is a sticky bun fight designed to take the steam out of the March 26th rally and show the working people of this country the elite have teeth too.

Far from marching with them, we should be opposing everything they are trying to achieve. In placing this posting you have given the right free advertising. I can only say I am horrified. It is no way for a genuine socialist to behave.

Like, WTF dude? NO! :D

Seriously, do we really want bigger numbers at this march? I’m not sure lefties do. We want tumbleweed blowing down Embankment, we want them to have carry a full length mirror each to pretend there’s more than two dozen people there. We want to laugh at their pitiful numbers. We want viewers to laugh at their pitiful numbers too.

I sort of get your strategy, subvert and hijack the already rather muddled message of the march to project your own message for the forces of good, but I can’t help but think the TV propaganda machine of the Tory government, Sky News and the seemingly new TV propaganda machine of the Tory government, BBC News will simply show pictures of the numbers, and simply push the simple message that it’s a successful march in favour of government cuts. Toby Young will get his stupid, annoying Phil Mitchellesque mug on the screen, sell his message, and that’ll be it.

Do we want that?

Things that will stop the cuts: people coming together to oppose them, whether they will be directly affected or not, whether they’re a political commentator or not, whether they support the Labour party or not.

Things that won’t stop the cuts: groundlessly threatening to take legal action against anyone who has the temerity to disagree with you.

75. Lisa Ansell

Ellie Mae – I dont recall disagreement. I recall her mocking, claiming that I didnt understand what legislation was(obv not a clever old journalist like Jennifer) and describing me as a radical because I er….oh yeah. Didnt see Labour as part of the solution.

Things that wont help the fight against the cuts. THe political blogosphere, pretending they are leading the charge against the cuts, on the understanding that people affected by them dont mention Labours role. Websites who have decided LAbour are the only solution to cuts they support, declaring everyone and everything outside that to be marginal. The public discourse around cuts being based on party political lines- when the cuts that do most damage are the subject of cross party consensus. Oh yeah-other things that wont help the cuts. The marginalisation that ensures that women, children, carers, the ill, and the disabled can be hit first because they are largely absent from public debate. So called lefty feminists writing articles dismissing communities of thousands and thousands of women affected- because she disagreed with their views.

Other things which might hinder the cuts- traditional hierachies and inequality manifesting itself within the anti-cuts movement- with friendships and political allegiance dictating whether someone is allowed to speak. So called lefties having two or three hour twitter debates mocking the idea of inclusivity(cos its only wrong when others do it). Other things that might hurt the cuts fight- people like Sunny telling people who are quite literally losing their homes and their ESA- they are being unconstructive and not listening to him when he says Labour will help her.

Oh wait- other things that might not help in the fight against

Other things that wont help the cuts. Our political blogosphere exploiting the cuts for their own ends- to have a happy little ruck where they all get to bicker and make noise at a rally

You are right Ellie- coming together to fight the cuts is exactly what is needed. Perhaps you should translate that into your own behaviour?

And as I recall I asked you several tiems to contact me- and your friends at New Left Project- nothing. Tell you what I will do Ellie- below is the link to what I said at Netroots. Why dont you have a look, and then read what Jennifer wrote and your response to it. Then perhaps talk to Kate Belgrave about the effect of Sunny’s behavioour(not in isolation to be fair).

http://dl.dropbox.com/u/3421076/ansell_speech_50.mp4 <<<THAT is what I said at Netroots. In fact some of it seems remarkably prescient really, consider the actions of you, Sunny, The New Left Project and Jennifer Mahony afterwards.

http://www.newleftproject.org/index.php/site/article_comments/netroots_the_lowdown/

Now I know consistency isnt your strong point. Loved the irony of seeing you tweet about how important it was not to marginalise womens experiences and voices after publishing a piece on here doing just that though.

76. Lisa Ansell

Could a moderator delete that above comment

77. AnotherTom

“Why do no Keynesian economists ever discuss the damage too much debt (and the interest payments on them) can cause to GDP growth….after all, by their own definition, they reduce spending??”

Because they are politically invested in a different position. The Guardian is the bellwether and early on in the financial crisis decided – rather bizarrely – that debt was good, if it came from the state. All the rest of the centre-left quickly followed suit, and we now have this peculiar (but aggressive) leftist consensus: anyone that believes the state can’t borrow ad infinitum is evil.

It is ridiculous to complain about public sector debt. With an economy at below full capacity the level of public sector debt is irrelevant.See for example-

http://pragcap.com/resources/understanding-modern-monetary-system


Reactions: Twitter, blogs
  1. Liberal Conspiracy

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  2. Rick

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  3. cowan88

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  4. Alias the Jester

    Why I'll be joining the right-wing Rally Against Debt http://bit.ly/ebJuTg (via @libcon) < is it right-wing?! really?!

  5. Saadaab Janab

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  6. Adam Dunkley

    RT @libcon: Why I'll be joining the right-wing Rally Against Debt http://bit.ly/ebJuTg

  7. sunny hundal

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  8. sunny hundal

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  9. MerseyMal

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  10. Jonn Elledge

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  11. Johanna Anderson

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  12. Tony N

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  13. Rally Against Debt

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  14. The Old Politics

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  15. leckie

    Sunny Hundal doesn't understand the difference between 'support' and 'counter-protest' http://t.co/jMoEI7M

  16. Nick V

    RT @sunny_hundal: Why I’ll be joining the right-wing #RallyAgainstDebt in May. Other lefties should too! http://bit.ly/ebJuTg

  17. Andy S

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  18. Andy Bean

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  19. Phil Chamberlain

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  20. Michael Bater

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  21. Scott Macdonald

    RT @sunny_hundal Why I’ll be joining the right-wing #RallyAgainstDebt in May. Other lefties should too! http://bit.ly/ebJuTg >> good points.

  22. Michael Heaver

    RT @sunny_hundal: Why I’ll be joining the right-wing #RallyAgainstDebt in May. Other lefties should too! http://bit.ly/ebJuTg

  23. MustBeRead

    Sunny Hundal of @libcon (Liberal Conspiracy) explains why he'll be joining the "right-wing Rally Against Debt" http://bit.ly/ebJuTg

  24. mark wright

    RT @verblet: Sunny Hundal doesn't understand the difference between 'support' and 'counter-protest' http://t.co/jMoEI7M

  25. Kevin Blowe

    Quite RT @lisaansell: Satire is dead. "Why I’ll be joining the right-wing Rally Against Debt" (Hundal) http://t.co/celItKx

  26. Walaa Idris

    #MustBeRead: #SunnyHundal of #LiberalConspiracy, explains why he'll be joining the "right-wing… http://bit.ly/ebJuTg

  27. Our Mate Dave

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  28. Natacha Kennedy

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  29. Carla

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  30. Other TaxPayers Alli

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  31. Jed

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  32. Chris Wallace

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  33. Pam Jakeman

    RT @sunny_hundal: Why I’ll be joining the right-wing #RallyAgainstDebt in May. Other lefties should too! http://bit.ly/ebJuTg

  34. Jed

    http://bit.ly/ebJuTg Is this what happens when someone leaves Sunny plugged into the mains for too long? #outdonehimselfthatladhas

  35. Zoe Stavri

    RT @jedweightman: http://bit.ly/ebJuTg Is this what happens when someone leaves Sunny plugged into the mains for too long? #outdonehimse …

  36. Roger Thornhill

    If you are against debt AND cuts, you are for higher taxation, eh, @Sunny_Hundal? http://bit.ly/ebJuTg

  37. Yonmei

    RT @sunny_hundal: Why I’ll be joining the right-wing #RallyAgainstDebt in May. Other lefties should too! http://bit.ly/ebJuTg

  38. Gods & Monsters

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  39. Matt Zarb-Cousin

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  40. Ash McGregor

    “@sunny_hundal: Y I’ll b joinin right-wing #RallyAgainstDebt in May. http://t.co/ZOMJ4wG” < wd b funny if Lab parties & TUs swamped this

  41. Rally Against Debt | Libertarian Party

    [...] http://liberalconspiracy.org/2011/04/04/why-im-attending-the-right-wing-rally-against-debt/ [...]

  42. roman gehre

    RT @sunny_hundal: Why I’ll be joining the right-wing #RallyAgainstDebt in May. Other lefties should too! http://bit.ly/ebJuTg

  43. Richard Jones

    Quite right. I think home mortgages are one of the worst things ever invented: http://bit.ly/gxWRuE via @sunny_hundal

  44. Soph

    I won't. ;) RT @sunny_hundal: Why I’ll be joining the right-wing #RallyAgainstDebt in May. Other lefties should too! http://bit.ly/ebJuTg

  45. sunny hundal

    Just because right-wingers are unaware / deluded on how Osborne is increasing debt doesn't mean we can't educate them http://bit.ly/ebJuTg

  46. Posh Wet Tories to Hold Posh Wet Rally Against Debt | the void

    [...] the opportunist, reformist traitor  Sunny Hundal is confused again.  A Rally Against the Rally Against Debt has already been announced.  The original Rally Against [...]

  47. pete massey

    RT @sunny_hundal: Why I’ll be joining the right-wing #RallyAgainstDebt in May. Other lefties should too! http://bit.ly/ebJuTg

  48. Jan Bennett

    If you are against debt join the #RallyAgainstDebt in May http://t.co/ZaCKEAW Hijack the #RallyAgainstDebt for the left #FuckOsborne

  49. Old Holborn

    RT @Biggervoice: If you are against debt join the #RallyAgainstDebt in May http://t.co/ZaCKEAW Hijack the #RallyAgainstDebt for the left …

  50. Crazy libertarians talk to themselves on Rally Against Debt Facebook event « the red rock

    [...] not following the hilarious #rallyagainstdebt episode, Sunny Hundal has a solid explanation at Liberal Conspiracy. Also, as of this evening the @UKDebtRally Twitter account, seems to have more followers than the [...]

  51. YellerCol

    RT @sunny_hundal: Why I’ll be joining the right-wing #RallyAgainstDebt in May. Other lefties should too! http://bit.ly/ebJuTg

  52. Cllr Krupesh Hirani

    Reasons to join the right-wing Rally Against Debt http://t.co/OXowHpg

  53. “The Other Rally Against Debt” « Though Cowards Flinch

    [...] Sunny has declared his interest in going, and has urged other lefties to join him. I may just do that, but under the following banner: “The Other Rally Against Debt”. [...]





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