Corbynomics: A Dystopia

Generali

cells wrote: »

well wind mills and PV panels are subsidized for many of the same reasons, local jobs local taxes less imports blah blah blah

why not offer a local subsidy for new coal mining. Maybe £20 a ton.

Its not likely to be that costly. 30 million tons x £20 a ton = £600 million in subsidy or less than 50p a week for each household


also there is a huge huge quantity of coal in the UK and much more than that again in the north sea. The private sector if given subsidy might be able to develop ways to unlock that, eg underground coal gassification.

Because it's illegal state aid under EU law.

cells

Generali wrote: »

Because it's illegal state aid under EU law.

could we just not subsidise MEPs to vote the right way?

cells

CLAPTON wrote: »

All other things being equal one would expect a home coal mining industry to reduce coal imports and so reduce the current trade deficit

but does this make us richer?
if so would we not be even richer if we subsidised the car industry to cut imports

and be even richer if we subsidised the clothing industry to cut imports
......................

you don't have to subsidies the locals you could also put a tariff/tax on imports.

with traded goods there will be balance in time there has to be

for example its clear that Japan car manufacturers simply couldn't manufacture and export 20 million cars a year from japan it would result in too high a yen to make it work. So they go an open factories all over the world.

If the UK had no car manufacturing then the government should really insist that some of the manufacturers come and open up factories here. If that is not enough then a temporary tariff should be put in place eg £1k a car or whatever until the uk was more or less in balance with its cars imported and exported

i think in this respect china has done well. They simply cant afford to become big importers of anything so they encourage foreign companies to set up or they subsidies into existence domestic manufacturers

---

with natural resources its somewhat different.

CLAPTON

cells wrote: »

you don't have to subsidies the locals you could also put a tariff/tax on imports.

with traded goods there will be balance in time there has to be

for example its clear that Japan car manufacturers simply couldn't manufacture and export 20 million cars a year from japan it would result in too high a yen to make it work. So they go an open factories all over the world.

If the UK had no car manufacturing then the government should really insist that some of the manufacturers come and open up factories here. If that is not enough then a temporary tariff should be put in place eg £1k a car or whatever until the uk was more or less in balance with its cars imported and exported

i think in this respect china has done well. They simply cant afford to become big importers of anything so they encourage foreign companies to set up or they subsidies into existence domestic manufacturers

---

with natural resources its somewhat different.

in what way is a tariff barrier not equivalent to a subsidy?

it makes the people pay more for things that otherwise would be bought for less?

how does it make us all richer?

cells

CLAPTON wrote: »

in what way is a tariff barrier not equivalent to a subsidy?

its a indirect subsidy rather than the direct type eg FIT payments to solar

CLAPTON wrote: »

it makes the people pay more for things that otherwise would be bought for less?

yes and no.
Lets say you subsidize coal, clearly thats a cost

but on the other hand the trade balance is stronger, so buying imported bananas or chinese toys is going to be a bit cheaper

it all depends on the size of subsidy vs the quantity of production.

Clearly if it only took a million pounds subsidy for the UK to become the worlds biggest coal miner that would be good for us and good for the world.

but if it takes £100 billion a year in subsidy it would be a disaster

also subsidy can in time lead to innovation which makes subsidy unnecessary

to that end the USA spends quite a lot of money trying to subsidies new technology int existence. From wind mills to PV panels to electric cars to high mpg cars to new fuels to ....

actually maybe the USA is the only country in the world which does this to some extent privately. they have venture capitalists who take punts on such things but for most other nations that simply doesnt exist and the government is the only one to turn to

also the huge american megacorps like google apple facebook etc make so much money that they seem to think thowing a percent or two of the profit into craxzy ideas is worthwhile. eg self driving cars new makani wind mills project tango, drones to give the third world internet etc etc

CLAPTON wrote: »

how does it make us all richer?

it brings forward technology

plus governments subsidize lots of things. for example i suspect we would be better off if the government spent £15B a year less on the army and used that money to subsidize uk manufacturing and technology. the cost to the nation would be the same but the benefit arguably more

antrobus

cells wrote: »

...yes and no.
Lets say you subsidize coal, clearly thats a cost

but on the other hand the trade balance is stronger, so buying imported bananas or chinese toys is going to be a bit cheaper...

By the same argument, imported coal would also be cheaper.

cells wrote: »

....it all depends on the size of subsidy vs the quantity of production..

It also depends on what else you could get for the same money.

cells wrote: »

....Clearly if it only took a million pounds subsidy for the UK to become the worlds biggest coal miner that would be good for us and good for the world.....

China is currently the world's "biggest coal miner", producing something like 3.5 billion tonnes a year. I don't believe that UK coal output has ever exceeded 300 million tonnes a year, so that is not really an achievable target.

cells wrote: »

.....but if it takes £100 billion a year in subsidy it would be a disaster

Of course it would be a disaster, we only import about 42 million tonnes of the stuff. Coal appears to be about $40 a tonne, so that's only about a £1 billion.

cells wrote: »

....also subsidy can in time lead to innovation which makes subsidy unnecessary...

We've already been down that road.

antrobus

CLAPTON wrote: »

yes but we must give Labour full credit here, as more miners lost their jobs under labour than under the tories

I'm not sure that is (strictly speaking) correct. But it is certainly true that Harold Wilson closed more coal mines than Thatcher.

Generali

antrobus wrote: »

I'm not sure that is (strictly speaking) correct. But it is certainly true that Harold Wilson closed more coal mines than Thatcher.

IIRC, the destruction of mining was really in the period 1950s-1970s. The UK just ran out of cheap coal to mine.

antrobus

Generali wrote: »

IIRC, the destruction of mining was really in the period 1950s-1970s. The UK just ran out of cheap coal to mine.

UK coal production was fairly static at about 220 million tonnes or so during the 1950s, it is from the 1960s onwards it starts declining. The railways stopped using coal, we got natural gas, consumers switched to central heating, etc until we got to the position that virtually the only customers for coal were (a) electricity generators, and (b) steel producers.

The current problem is that a large number of the UK's existing coal powered generators do not meet emission standards, and are thus being closed down. The National Grid anticipates that they will all be gone by 2030. With no demand from domestic power generators, we wouldn't need to import any coal at all. I would therefore suggest that subsidising the production of something that we don't need would not be very sensible at all.

Tromking

Moby wrote: »

You completely ignore of course the fact that 'the people' as you call them are not a homogenised group which are automatically anti union. Many 'people' like me for instance are in a union. With regard to 'vested interests' of the few....I would not describe the struggle for better working conditions in such a way....especially after seeing how working down a mine affected the health of my father and grandfather.

I agree.
The bogeymen/women of British public life are no longer the Union Barons but are now the politicians. There's been a few Tories of late who are concerned enough to say that Corbyn might just be tapping into a latent feeling amongst the British people that government does not operate for the ordinary citizen and hasn't done for many years.
Change is coming.