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Labour goes back to its roots.

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  • Wookster
    Wookster Posts: 3,795 Forumite
    I already answered it. The obsession with paying down debt in record time is how you pay for it. Don't slash public services, you don't dump a load of people on the dole, don't delay the recovery and therefore get back to growth quicker. That generates higher tax revenues that allow you to do both.

    Its simple. Either you take a pragmatic look at debt, realise we're not about to go bust, that we have comparitively low debt vs the few countries with bigger economies than ours, and get on with the job of running the country. Yes we need to reduce it, but it can be done gradually until things pick up enough to run the kind of big budget surplus we had in 88-90 and 95-01.

    No you haven't answered the question. You've just ratted off the Crash mantra: spend spend spend, with no concern of if there is value for money or what the effects are on the rest of the economy, or on future generations.

    How is the government going to raise so many billions of pounds? Pounds that could better be spent creating wealth privately.

    At this rate, the London will be Iceland MK2.0
  • Rick62
    Rick62 Posts: 989 Forumite
    tomterm8 wrote: »
    What labour has announced they will do after the election is public spending cuts on the scale of Howe. And, I think it may end up being deeper cuts than that. (Note, while they are suggesting 0.7 growth, in reality with european commitments and other spending commitments figured in, government departments will recieve an average cut of 2% a year for the life of the next parliament).

    The tax raises were headline grabbing, but the nuts and bolts are that there is a political consensus that massive spending cuts are on the table for the next election.

    My understanding was that Labour are not planning any cuts but are hoping that they can just grow the public sector slightly slower than the total economy.

    They hope that GDP will go back to 3.5% in 2011 and that by then growing state expenditure by 'only' about 1% in real terms then they will close the gap by 2.5% a year, until in 2132 the books are balanced again.

    What cuts have they announced?
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  • cogito
    cogito Posts: 4,898 Forumite
    Rick62 wrote: »
    My understanding was that Labour are not planning any cuts but are hoping that they can just grow the public sector slightly slower than the total economy.

    They hope that GDP will go back to 3.5% in 2011 and that by then growing state expenditure by 'only' about 1% in real terms then they will close the gap by 2.5% a year, until in 2132 the books are balanced again.

    What cuts have they announced?

    None as far as I know but they're not called 'cuts' unless the nasty Tories make them. They're now known as efficiency savings but Darling isn't actually making any in this tax year so presumably public services are currently 100% efficient but won't be next year (i.e. until after Labour have been booted out by the electorate).
  • mewbie_2
    mewbie_2 Posts: 6,058 Forumite
    1,000 Posts Combo Breaker
    I got as far as "fin de siècle " and gave up.

    But I don't like Gordon if that helps.
  • tomterm8
    tomterm8 Posts: 5,892 Forumite
    Part of the Furniture Combo Breaker
    Rick62 wrote: »
    My understanding was that Labour are not planning any cuts but are hoping that they can just grow the public sector slightly slower than the total economy.

    They hope that GDP will go back to 3.5% in 2011 and that by then growing state expenditure by 'only' about 1% in real terms then they will close the gap by 2.5% a year, until in 2132 the books are balanced again.

    What cuts have they announced?

    They are planning a 0.7% increase in real terms, compared to (say) the 1.2% increase in real terms of the tory government under Howe. A government famous for its spending cuts.

    A 0.7% increase in real terms equates to departmental cuts of over 2%, because of compulsory increases in EU budget, and other fixed costs. I can't for the life of me remember any government since the war restricting spending as deeply as the labour party is proposing.

    In fact, they are proposing 0% growth from 2013, and it would be a challenge to find any historic government cutting that deeply since the great depression.

    People simply don't seem to realise what the concept of 0% spending growth in real terms means... it would bring with it a real risk of riots on the street.

    Of course, this is after the next election. It is made from "efficiency savings". To which my answer is: efficiency savings, my !!!!. The only way to get such an extreme cut is to significantly reduce the size of the public sector. That means firing people, and closing hospitals.
    “The ideas of debtor and creditor as to what constitutes a good time never coincide.”
    ― P.G. Wodehouse, Love Among the Chickens
  • Wookster wrote: »
    No you haven't answered the question. You've just ratted off the Crash mantra: spend spend spend, with no concern of if there is value for money or what the effects are on the rest of the economy, or on future generations.

    How is the government going to raise so many billions of pounds? Pounds that could better be spent creating wealth privately.

    I did answer - increased tax revenues from economic growth. The same way that every other government pays for things. You think we'll be in recession for ever and ever with no prospect of tax receipts increasing?
  • Wookster
    Wookster Posts: 3,795 Forumite
    I did answer - increased tax revenues from economic growth.

    What economic growth? We ain't gonna see any growth for another 12-24 months. Don't tell me you believe in the 1.25% in 2010 & 3.5% in 2011?
    The same way that every other government pays for things. You think we'll be in recession for ever and ever with no prospect of tax receipts increasing?

    Of course not - but not for a while. Painful choices do need to be made. The forecast budget deficits (being an optimistic forecast) are unsustainable imo.
  • mewbie_2
    mewbie_2 Posts: 6,058 Forumite
    1,000 Posts Combo Breaker
    I did answer - increased tax revenues from economic growth. The same way that every other government pays for things. You think we'll be in recession for ever and ever with no prospect of tax receipts increasing?
    Can I just edit this slightly?

    increased tax revenues from increasing tax and hoped for economic growth
  • You two are just talking about the next year or so - according to the Tories we need to slash spending for a decade or two. hats when I am talking about - and the only way to get back to growth is to climb out of recession. history shows that you do not end a recession by feeding it public sector jobs and by cutting money out of the economy.

    "Where do we get the money from" you keep prattling - we borrow it. So we end up with 79% debt - so what? Will the sky fall in?
  • mewbie_2
    mewbie_2 Posts: 6,058 Forumite
    1,000 Posts Combo Breaker
    Will the sky fall in?
    Yes. Because he didn't fix the roof while the sun was shining.
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