What needs to happen to fix this?

Dylanwing

We cant increase taxes at the top end or they will all just b*gger off to oz/singapore/oceana

Well, judging by the mess that the highly paid Bankers etc. have made, maybe that would be a good thing. In fact, maybe Goodwin, Applegate et al could start packing... Just leave your bonusses behind as you leave chaps.
It's all very well telling ordinary folk to 'live on gruel', but the pain has to be shared by the well-off as well. Top salaries need to be realistic to recognise that the 'market rate' has dropped with recession/ depression.

WTF?_2

nimpoppy wrote: »

Any ideas what the government should actually do to fix this problem?

Although on a whole I don't like the labour government one bit because I do believe that they have gone round this problem the wrong way. They have thrown money at the problem all too late. Rather like shutting the gate after the horse has bolted. I was just wondering if anybody has any super ideas on how to actually fix these problems that we have

The banks have come to depend too much on the money markets to make up the shortfall between deposits and lending - we need to get back to a situation like the year 2000 where they broadly matched.

That means people need to pay down debt and save more.

It also means no more slashing interest rates wildly (not that there is much left to slash).

Radical action needs to be taken to consolidate the banking system into something that is viable. That means proper mergers and layoffs where there is duplication of work. Shareholders get wiped out if necessary.

House prices need to fall to levels where people can buy one by borrowing a sensible amount (3.5x single, 2.5x joint) with a minimum 10% deposit saved. The sooner vendors get over the fact that peak 2007 prices are history, the better.

Businesses need to focus on producing stuff that people (in particular, foreigners) want/need to buy instead of playing with money to synthesize new 'wealth' that is merely an illusion, or flogging imported consumer goods to people borrowing the money generated from the money games in the City and Wall Street.


This will be extremely painful but we are going to have a lot of pain no matter what happens - there is no magic bullet to make it all better.


What I reckon is going to happen however is that the govt send rates to zero, print up money to recapitalise the banking system and then finish the job of nationalising it. They will then use the banks to dole out new money like Ben Bernanke was hypothetically using a helicopter and we'll end up with raging inflation as the government attempt to redistribute wealth from the sensible to the spendthrifts.

This might produce an illusion of 'recovery' in the near term but will collapse in a huge, irredemable heap a year or two down the line.

Maisie11

Working needs to be seen as attractive. When you get more on benefits because of your lifestyle choices you know things are going down hill. People seem to think they can 'choose' to have numerous children by different fathers and that they can 'choose' to mess around at school hence the lack of qualifications and 'someone' else will pick up the tab. If a young girl sees it as her right to have a child that she doesnt pay for fine but have hostels where they can share rooms, have help and support but dont make it atractive and a lifestyle choice. Also give out food vouchers as opposed to just money.

Once we

Cleaver

davilown wrote: »

Leave it alone - let the banks go bust, let people lose their houses. Lets just begin again with those who are financially viable to continue. People will then have second thoughts to 'I must have it today' mentality.

Aww, you big softy. How lovely.

Conrad

1) Stop chasing growth, 'cause mother Earth's breast is getting as flat as witches t1t

2) Be content with less

3) Resocialise the masses so that they to come to enjoy walking and learning instead of Ok Mag, hoarding trinkets and shopping temples

4) Split the Banks into 50 regional Banks

5) Stigmatise lounging around on benefit as the Italians stigmatise teenage single motherhood

6) Pay everyone £300 benefits - after that you can chose to earn on top or louge about. I believe the Danes have taken this model.

7) Grow up, most of us are like spoiled kids, hoarding and consuming, hating and fearing.

Sapphire

mbga9pgf wrote: »

Increase Tax thresholds for couples to 15000 tax free on single salary if they work full time, re-introduce joint income calcs for married couples taxation.

Why on earth single out couples? (Are you part of one?) There are many single people who are incurring just as much hardship as couples (or more, since they can rely on only one income), and are very productive members of society. These people often have never taken any benefits from the taxpayer, e.g. child benefit.

Sapphire

!!!!!!? wrote: »

The banks have come to depend too much on the money markets to make up the shortfall between deposits and lending - we need to get back to a situation like the year 2000 where they broadly matched.

That means people need to pay down debt and save more.

It also means no more slashing interest rates wildly (not that there is much left to slash).

Radical action needs to be taken to consolidate the banking system into something that is viable. That means proper mergers and layoffs where there is duplication of work. Shareholders get wiped out if necessary.

House prices need to fall to levels where people can buy one by borrowing a sensible amount (3.5x single, 2.5x joint) with a minimum 10% deposit saved. The sooner vendors get over the fact that peak 2007 prices are history, the better.

Businesses need to focus on producing stuff that people (in particular, foreigners) want/need to buy instead of playing with money to synthesize new 'wealth' that is merely an illusion, or flogging imported consumer goods to people borrowing the money generated from the money games in the City and Wall Street.


This will be extremely painful but we are going to have a lot of pain no matter what happens - there is no magic bullet to make it all better.


What I reckon is going to happen however is that the govt send rates to zero, print up money to recapitalise the banking system and then finish the job of nationalising it. They will then use the banks to dole out new money like Ben Bernanke was hypothetically using a helicopter and we'll end up with raging inflation as the government attempt to redistribute wealth from the sensible to the spendthrifts.

This might produce an illusion of 'recovery' in the near term but will collapse in a huge, irredemable heap a year or two down the line.

I can't seem to be able to thank you, but your post makes a lot of sense to me.

mewbie_2

Sapphire wrote: »

I can't seem to be able to thank you, but your post makes a lot of sense to me.

I can't bring myself to thank him either.

mbga9pgf

Sapphire wrote: »

Why on earth single out couples? (Are you part of one?) There are many single people who are incurring just as much hardship as couples (or more, since they can rely on only one income), and are very productive members of society. These people often have never taken any benefits from the taxpayer, e.g. child benefit.

This is more to do with bringing up kids in stable environments. If you have one parent working full time, it gives the child a better work ethic for the future.

Its based off a model they run in france and is highly successful there.

5. Calculating Your French Income Tax Liability

In determining your tax liability the tax authority will first establish your gross earnings, your revenu brut global.

They will then make certain allowances against this income to arrive at your net earnings, your revenu net global.

Your tax liability will then be calculated on a progressive basis, having regard to the composition of your household and the allowances to which you may be entitled.

5.1. Composition of Your Household

In order to minimise the impact of higher rates of taxation on those with dependants, the size of the household is taken into account in determining the total amount of income tax which should be payable.
This is called the quodient familial.



The method used is to divide the household into ‘parts’ corresponding to the size of the household.

The total income of the household is then divided by the number of members in it.

A notional tax charge is created for a single ‘part’ on a progressive basis using the income tax bands.

The resulting figure is then multiplied by the number of ‘parts’ to give the tax liability for the household.

So, a single person would start paying at higher rates of tax than a three person household on the same income because, in the latter case, tax is calculated on the partial share of the income of each member of the household.

As might be expected there is a complicated set of rules for calculating the number in each household to take account of the varied and different circumstances of families. Broadly speaking, however, each adult counts as one share and each child a half share, although the third and any subsequent children or dependants count as one share.

Thus, in a household with two adults, the household income would be divided by two, whereas in a household with two parents and two children the household income would be divided by three.

The rules are slightly more generous for single parent household and those where there are handicapped children or adults in the household.

Unmarried couples in a civil partnership (called PACS) are treated the same as married couples.

In order to ensure that those with large incomes do not benefit over generously from this system the amount of tax savings for dependants is also limited to a maximum sum where the income of the household exceeds certain limits, although these limits are fairly generous and should not be relevant to most expats.

davilown

Wookster wrote: »

Without banks, no one is financially viable.

Without the bailout the UK economy would have collapsed - we would be getting our meals from soup kitchens in council buildings. It would be back to the dark ages.

Why?

We earn money, we pay our bills. Anyway, i said don't bail the banks outs. Not all of them need bailing out. Why should our money be used to bail out the share holders so they don't lose any money?

I get paid, I buy my food, pay rent, save , buy a house cash. why do I need a mortgage or bank for those? Postal system works well to cover all bill payments.