Corbynomics: A Dystopia

Rusty_Shackleton

cogito wrote: »

You might try reading my post again and then point out to me where I said Corbyn had got personal. I didn't. I'm talking about his supporters who spew endless bile about the Tories and whom he never ever pulls back into line.

Do you think Corbyn is the only person who has 'followers' who make personal attacks on opponents, or do you just think only he should have control over them? Because right wingers attack the left constantly. You're singling out one person for not controlling people he has no authority over, and not holding his peers on the opposite benches to the same standard.

Hell, the government didn't even criticise the Daily Mail for the 'enemies of the people' attack on judges !!!!!!. Take that in for a minute... the GOVERNMENT didn't feel the need to defend the JUDICIARY for doing their damn jobs.

Thrugelmir

Rusty_Shackleton wrote: »

What do you mean by every labour govt. has left us in a financial mess? If you mean Labour have borrowed more money, you’re categorically wrong. The Tories have borrowed more money than labour over the past 70 years.

If you mean other economic factors such as GDP.

Statistics need to be into context. Interesting that the post GFC period was ignored so not to paint the Tories in a bad light. When it was Brown's mismanagement that caused the ongoing issues! Also that Brown inherited an improving economy in 1997. If one was to prepare a set of accounts. Then prior years would have to be restated to give an accurate picture of events.

GDP is a number that politicians hide behind. There's far better KPI's with which to measure the health of the economy.

bobbymotors

Rusty_Shackleton wrote: »

Bobby, you really can't compare a country's finances with that of a household or a business.

It's literally impossible for a country that issues it's own free-floating currency to 'run out of money'. Yes, we literally can keep printing money. Admittedly, you can't print it too fast, but you'd be surprised how much you can get away with.

For example, do you believe that we could print over £900 billion in a single year without Zimbabwe like results? For context the total UK government expenditure in 2016-17 is expected to hit £772 billion. Well we can print £900 billion in a year, and I can prove it... because that's what we did in 2008 to bail out the banks.

Now, I know what you're thinking... that was a one off, we couldn't possible keep doing that!

Well I'm afraid you'd be wrong again because quantitative easing is another way of saying print money... and by 2012 the BoE QE programme stood at £375 billion. Remember, this is completely separate and in addition to the money we 'borrow' to cover the deficit.

The above is just to demonstrate just how much money we can borrow in a short time, and not cause economic catastrophe.

Please learn more about a topic before making such sweeping statements as you've been making. In the words of Abe Lincoln, 'better to remain silent and be thought a fool than to speak out and remove all doubt'.

You don't get it do you. The books HAVE to be balanced at some point.

There are all sorts of things like QE that will work for a while and put a finger in the dyke (ooo matron...!)

But in the end there is no other way than to combine spending less and earning more. No other way. It can't be done. If it could we would just print off £175 trillion or whatever it is and the country would be debt free. no more interest to pay. hooray. Need another 25 hospitals? Print some money let's build them.

YES, the amount of money in circulation each year goes up, because businesses make money, exports bring money in and inflation means more money is needed to do this year whatever you did last year.

but in the end you need revenue to match or exceed expenditure. whether it' the country / your business/ your household. I really don't think I'm the fool here.

it can't possibly be any other way.

Thrugelmir

Rusty_Shackleton wrote: »

What do you mean by every labour govt. has left us in a financial mess? If you mean Labour have borrowed more money, you’re categorically wrong. The Tories have borrowed more money than labour over the past 70 years.

If you mean other economic factors such as GDP.

Statistics need to be into context. Interesting that the post GFC period was ignored so not to paint the Tories in a bad light. When it was Brown's mismanagement that caused the ongoing issues! Also that Brown inherited an improving economy in 1997. If one was to prepare a set of accounts. Then prior years would have to be restated to give an accurate picture of events.

GDP is a number that politicians hide behind. There's far better KPI's with which to measure the health of the economy.

In 2010 the economy was improving, then the coalition drove us into another recession in late 2011/early 2012.

What did the coalition do in the space of 12 months to drive the economy into a recession? I'm fascinated to know your perspective.
.

I agree that a chancellor shouldn’t really have a background in journalism... alongside their 2:1 degree in Modern History it doesn’t really give them the experience to be chancellor… oh wait, that’s George Osborne’s background! Silly me!

What happened to the man that expected to become head of the World Bank. Due to "Saving the World".

I'm no Osborne fan. However Blackrock the largest investment manager in the world. Seem happy to employ him for his services. Must have something to offer.

bobbymotors

Rusty_Shackleton wrote: »

Okay, you need to quantify what you mean by financial mess then - since you've been talking about government debt, I gave you a source demonstrating that the Tories have borrowed more in the last 70 years than Labour, adjusted for years in power and for inflation. So in real terms, Tories borrow more per year than Labour.

Well I think I already kind of did...but since you ask. Wilson was forced to devlue the £ in 1967 because there was a balance of payments crisis.

In 1977, sunny jim callaghan had to go to the IMF as we were fresh out of money and inflation peaked at about 27%

An gordon brown....well, let's just say the iron chancellor turned out to be a bit of a rust bucket .

Rusty_Shackleton

Thrugelmir wrote: »

Statistics need to be into context. Interesting that the post GFC period was ignored so not to paint the Tories in a bad light. When it was Brown's mismanagement that caused the ongoing issues! Also that Brown inherited an improving economy in 1997. If one was to prepare a set of accounts. Then prior years would have to be restated to give an accurate picture of events.

GDP is a number that politicians hide behind. There's far better KPI's with which to measure the health of the economy.

I agree GDP has it's limitations, national debt is also irrelevant, but I was countering Bobby's points and he doesn't understand that the govt doesn't borrow on a bloody credit card. Hence why I've asked him to quantify what measurement he makes the charge that Labour leave the economy in a 'bloody mess' every time they leave power since the 60's... because it's absolute rubbish, I just want to know what metrics I need to demonstrate it to him in!

As for GFC, yes, the source shows debt figures including post crash, but then removes to avoid Tories trying to say post-2010 worsens their figures. It does so, but when you remove it the Tories are still prolific borrowers. As for your contention that Labour in '97 inherited a growing economy... well, yes and no. See here. GDP was growing, and continued to grow under Labour until the GFC. In fact, since 1990, Labour had lower growth than the tories in only 2002 and 2006. Even then it was still 2.5% PA. The Tories on the other hand have got growth above 2.5% in only 2 years, 1994 and 2014! Same source shows last Labour govt. also had an excellent record keeping unemployment down, and this is before post GFC govt's have gamed the definition of unemployment, which is actually nearer 20% today. See here.

Rusty_Shackleton

bobbymotors wrote: »

You don't get it do you. The books HAVE to be balanced at some point.

There are all sorts of things like QE that will work for a while and put a finger in the dyke (ooo matron...!)

But in the end there is no other way than to combine spending less and earning more. No other way. It can't be done. If it could we would just print off £175 trillion or whatever it is and the country would be debt free. no more interest to pay. hooray. Need another 25 hospitals? Print some money let's build them.

YES, the amount of money in circulation each year goes up, because businesses make money, exports bring money in and inflation means more money is needed to do this year whatever you did last year.

but in the end you need revenue to match or exceed expenditure. whether it' the country / your business/ your household. I really don't think I'm the fool here.

it can't possibly be any other way.

Bobby I'm sorry, but it''s you that doesn't get it. Country's that issue their own currency DONT need to balance the books. EVER.

When gilts need to be repaid, they can be repaid by issuing new gilts to somebody else... in perpetuity, over and over again. True, this only works with a constantly growing economy... but that's the basis of the entire global economic system!

Essentially, somebody will always buy UK govt debt, as long as they're confident we'll repay it. That's why you should borrow to invest... we spend the money now to drive growth, so the 'interest' on the loan is repaid by the growth in the economy.

Remember as well, if the government borrows money to build a new hospital, the government gains an asset (the hospital), but also immediately gets loads of the money they've spent back... construction company makes profit, pays corporation tax. Employees... that's NI and income tax... the things those employees buy, VAT, stamp duty etc. Anyone use a vehicle? Fuel excise duty and more VAT... and on, and on and on.

There is no such thing as a finite amount of money. Money is also affected by time, because the faster money changes hands, the more value more people get from it (that's why rich people sitting on money is a bad thing.. that money is effectively removed from the economy if it's not spent or invested.

You need to completely change the way you think about money when you move from being a consumer or a business, to the government that controls the currency.

Rusty_Shackleton

Thrugelmir wrote: »

What did the coalition do in the space of 12 months to drive the economy into a recession? I'm fascinated to know your perspective.
.
What happened to the man that expected to become head of the World Bank. Due to "Saving the World".

I'm no Osborne fan. However Blackrock the largest investment manager in the world. Seem happy to employ him for his services. Must have something to offer.

Well, recessions are mainly a lack of confidence in the economy, so I think cutting spending, cutting thousands of public sector jobs, ending Labours stimulus programmes, and generally telling the country that we were up !!!! creak economically might have had a lot to do with it?

Thrugelmir

Rusty_Shackleton wrote: »

GDP was growing, and continued to grow under Labour until the GFC.

If you deregulate credit markets, increase the public sector workforce by 500,000 and create increase welfare benefits then of course GDP will grow.

Trouble was the profits made by the banks in the boom era are now shown to be illusory. RBS has lost over £60 billion. PPI has cost another £25 billion. etc, etc. Hence my comment about using accounting principles. restating the banks accounts to what actually happened will post a very different picture.

The whole era can be summed up very easily.

But you don't need a degree in economics – or even, for that matter, a GCSE in maths – to understand what went so spectacularly wrong.
The demise of RBS can be summed up in just one word: greed.

Brown surfed the wave..........

Rusty_Shackleton

bobbymotors wrote: »

Well I think I already kind of did...but since you ask. Wilson was forced to devlue the £ in 1967 because there was a balance of payments crisis.

In 1977, sunny jim callaghan had to go to the IMF as we were fresh out of money and inflation peaked at about 27%

An gordon brown....well, let's just say the iron chancellor turned out to be a bit of a rust bucket .

I'm afraid my knowledge of geopolitical events in the 60's and 70's is very limited, but I'll take a swing at those points...

1967 devaluation: 6 day war caused a global fuel shortage increasing cost of imports (beyond UK control), govt. had only been in power a year with a decent majority, the previous lab govt had a majority of 4 which I think we can all agree makes governing difficult. That previous govt. has only been in power since '64, before which, Tory govts since 1951.... quite relevant since the UK was suffering poor productivity. I don't know enough to say conclusively Labour fault or not, but I think these points show it's a more complicated picture than you portayed.

As for IMF crisis, in doing some quick reading this link was rather interesting - and from someone working in the treasury at the time, not a debt crisis, more to do with management of foreign exchange. He would tend to agree that it was poor political management though.

Just to point out, I don't think it's fair to either political party to refer to events that long ago, a very different world, very different political players etc.