Corbynomics: A Dystopia

cells

Generali wrote: »

It makes no difference. Past Governments showed us exactly how good they were at running companies.

A: they learnt their mistakes

2: in a global economy you cant load a steel plant that needs 3,000 men with 30,000 men

C: plenty of poorly run private companies destroying capital and families too

Generali

cells wrote: »

A: they learnt their mistakes

2: in a global economy you cant load a steel plant that needs 3,000 men with 30,000 men

C: plenty of poorly run private companies destroying capital and families too

A. That nationalisation is even on the cards tells me that's wrong
B. Tube trains have drivers paid three times the salary of bus drivers despite not requiring drivers at all
C. Yes but I'm not forced to pay for their mismanagement under threat of imprisonment (except banks).

happylucky

Generali wrote: »

C. Yes but I'm not forced to pay for their mismanagement under threat of imprisonment (except banks).

Absolutely. In the private sector, when it happens, it is at least voluntary and in any case less likely to occur through a more connected system of accountability in general.

Corbyn frightens the hell out of me, but with (I think ) over 60% London seats now Labour and a general election victory which whilst unexpected was hardly a Tory landslide, it's only to be expected that the underdog goes on the attack.

Same as SNP, with only 55% voting to remain in UK I fail to see how this was classified as a victory....in other countries, 45% voting against it with an enormous turnout would be noted as precursor to a civil war of sorts, with a strengthened attack from the "just lost it by an inch" team. Hello Nicola.

martinsurrey

cells wrote: »

A: they learnt their mistakes

really? so opening un profitable mines isn't on the cards? and they'd make 1'000's of people redundant if it was in the best interests of the company? You cant have your cake and eat it, buy a profitable firm, stop doing what makes it profitable (responding to the market), and still expect it to not be a basket case

cells wrote: »

2: in a global economy you cant load a steel plant that needs 3,000 men with 30,000 men

See Generali's perfect underground point.

cells wrote: »

C: plenty of poorly run private companies destroying capital and families too

So that means its okay for me to pay the government to do it as well?
a poorly run private company will fold, and be replaced, if the market needs it.

a poorly run gov owned company will limp along supported by gov funds (read our money), as they don't want the political backlash of making everyone redundant.

Generali

martinsurrey wrote: »

So that means its okay for me to pay the government to do it as well?
a poorly run private company will fold, and be replaced, if the market needs it.

a poorly run gov owned company will limp along supported by gov funds (read our money), as they don't want the political backlash of making everyone redundant.

This is exactly happened with nationalised industries in the 1945-79 period.

The eversoclever people in Whitehall decided to create nationalised monopolies which is what Mr Corbyn seems to be proposing. However, from an economic theory POV that creates a problem as monopolies price in a way that is, in theory, economically inefficient as a monopoly will be able to restrict supply and thus demand to maximise profits as competitors can't enter the market. As a result, it was decided that Nationalised Industries should produce as if they were operating under terms of Perfect Competition in the market so that marginal costs (the cost of producing one additional unit of output) equal prices.

However, for a monopoly this may well be a loss making position and in fact in most nationalised companies it proved to be a loss making position that was being imposed on the company. As a result, the losses had to be made up by the Exchequer which left very little cash for investment and companies became increasingly starved of capital.

The advantage perceived whereby the Government can borrow more cheaply than companies is explainable by the risk premium companies pay: they have to pay more to borrow than the Government because they are riskier. If they weren't riskier than the Government then long-term risk adjusted returns would be higher for investments in company bonds than Government bonds, something that is believed to be untrue under current views of Portfolio Theory.

Of course Portfolio Theory may well be wrong, as with much of economics it is in its infancy as a subject, and I can't imagine that Mr Corbyn cares much for or even knows much about Portfolio Theory.

Thrugelmir

cells wrote: »

A: they learnt their mistakes

Who is they? Politicians and civil servants have even less experience of running anything than they did. The leadership election speaks for itself!

Generali

Thrugelmir wrote: »

Who is they? Politicians and civil servants have even less experience of running anything than they did. The leadership election speaks for itself!

Yup. One candidate isn't a career politician and he's a career trade unionist.

I wouldn't trust any of them to run a burger van.

At least most of the Tories actually do something for a living before going into politics. Call Me Dave worked at Carlton Communications for seven years, Major famously ran away from the circus to become an accountant and Maggie was an industrial scientist.

Tromking

martinsurrey wrote: »

a poorly run gov owned company will limp along supported by gov funds (read our money), as they don't want the political backlash of making everyone redundant.

That's a bit of a hackneyed argument now, how many people remember the worst excesses of the 70's now. What about the inefficient private companies who despite only running 11% of our prisons take approx 25% of the budget? That should bother those interested in the way "our money" is spent, but it doesn't.
I suppose it depends on your political beliefs as to whether
Gov funds should be spent directly on our public services or vicariously to the shareholders of companies like Serco.

CLAPTON

Tromking wrote: »

That's a bit of a hackneyed argument now, how many people remember the worst excesses of the 70's now. What about the inefficient private companies who despite only handling 11% of our prison population take 25% of the budget? That should bother those interested in the way "our money" is spent, but it doesn't.
I suppose it depends on your political beliefs as to whether
Gov funds should be spent directly on our public services or vicariously to the shareholders of companies like Serco.

there's a quick win for Corbyn
he can reduce the prison budget and bring it in house too (obviously with massive increase in salaries, manpower and pension provision)

Tromking

CLAPTON wrote: »

there's a quick win for Corbyn
he can reduce the prison budget and bring it in house too (obviously with massive increase in salaries, manpower and pension provision)

Not really.
Thanks to recent 'reforms', salaries and manpower in the public sector broadly speaking match those in the private sphere. Hence the crisis in our prisons which you may or may not be aware of.
If Corbyn is switched on he'll just announce the amount of taxpayers money the privateers receive and Joe Public will realise this privatisation and outsourcing business is just a scam.