Why the lib-dems are shit

[killer b]

Isn't the problem that the country is in massive debt. As in, we owe shit loads of money to other countries (China?). Also that, as individuals, we are all massively in debt- like mortgages 5x salaries, loads of hire purchase. We've borrowed loads of money to live our (comparatively) luxury western lifestyles and now we're fucked.

Sorry for the lack of links, but that's my general understanding of why we have to cut Government spending by 25% in most departments. We have to pay back a big debt or we go bankrupt like Greece.

that's what the government say.

would you normally take what they say at face value?

 

[Streathamite]

butchers, what you've been doing is denying there's a problem (despite evidence to the contrary). a mentality one might expect of kindergardeners.

it a pity you haven't left those days behind you.

we do NOT need cuts on anything like the scale needed, and the proposed cuts may make things worse by triggering a second recession which further limits the UK's ability to cut the deficit (See; Ireland, and South America, pretty much all of it, throughout the 80s).
SElling back our shares in 2 huge banks would go a huge way to reducing the deficit.
e2a; These cuts are about ideology - Thatcherism, in fact - and not 'good housekeeping'

 

[Edie]

No.

Try reading the full article linked to in [URL="http://www.urban75.net/vbulletin/threads/332293-Cameron-s-economic-policies-will-kill-not-cure-look-what-s-happened-to-Ireland]this thread[/URL].

That's interesting. So basically:

Joseph Stiglitz explains: “If you introduce austerity measures, the amount you can raise in tax falls, and welfare payments go up – so you don’t have enough money to pay your debts anyway.”

So what is the solution? If spending less doesn't work. Who do we owe money to, and why have we let ourselves get so much in debt? We've obviously been spending more money then we're making, so some degree of spending has gotta go or we'll keep getting more and more into debt.

Jesus, how can one of the richest countries in the world be in so much debt? How can our government have allowed that to happen?

 

[i_got_poison]

kaka tim - i agree there is a ideological bent to the coalition cuts. i also agree the cuts could be made in such a way as to make it easier
on the public. it's true the deficit can't be paid off through cuts alone, either the government will inflate it's way out of the problem or seek to
raise the value of creditor nation's currencies in order to compete in the global market.

i read a few years ago, for a person worth £2m to enjoy the same standard of living they did in the late 90's they would need £6m today (circa 06/07).
which illustrates the rise in the cost of living and the inflation in the money supply with low interest rates. i make the point because everyone tries to
make every political discussion (on here) an egalitarian one, when in truth everyone is affected in some way by government policy (albeit some more than others).

kaka would you rather the government kept spending levels as they are, borrow to meet those demands, pay the exorbitant rates on the sovereign
debt through inflation and then go cap in hand to the IMF (a la james callaghan) and have them dictate our fiscal policy?

 

[butchersapron]

This is why the crude charts graphs and 50 word articles on businessinsider are not at all helpful. It produces the above.

 

[ViolentPanda]

The Royal Mail has had problems for years, a huge pensions defecit and failure to make a profit.

A pensions deficit massively exacerbated by the decision by RM management to take contributions holidays from the fund.
Oh, and "failure to make a profit"? May I suggest you actually read the annual balance sheets for Royal Mail for the last 20 years?

It's the least profitable mail company out of all of it's western counterparts, Deutsche Post (Germany) and TNT (Netherlands) achieved profit margins of 13% and 15% from their mail operations.

When one compares apples and oranges, opne arrives at travesties of reality such as the one above.

Something needs to be done about it and Labour didn't solve this problem with their 13 years in power so perhaps the Coaliton will make a better go of it.

So, based on a "perhaps" that is rooted in your own incomprehension of reality, you're happy for a bunch of ideologically-motivated (those that aren't, like Clegg, motivated purely by proximity to power, anyway) goons to roll the dice on Royal Mail?

You cretin.

 

[butchersapron]

Kennedy, the King over the water, has managed to miss just about every single event after only two days...

 

[ViolentPanda]

has it ever crossed your mind, some of these working families you mention, voted for the tories and the liberal democrats?

i talked about america because the opposite of cutting the deficit, is to increase it. the U.S. government is doing just that,
throwing hundreds of billions into the economy in the vain hope it stimulates the various sectors into growth. it's not working as unofficial
(real) unemployment figures in america is 22%.

You do realise that Keynesian stimulus needs to be long-term, not just a three year wonder? That it needs to exceed the length of the economic problem it is deployed against?
Foolish question. You obviously don't.
Perhaps you might reflect on what would have occurred in the last three years if so many nation-states hadn't supported their economies and launched economic stimulus packages.

 

[ymu]

That's interesting. So basically:


So what is the solution? If spending less doesn't work. Who do we owe money to, and why have we let ourselves get so much in debt? We've obviously been spending more money then we're making, so some degree of spending has gotta go or we'll keep getting more and more into debt.

Jesus, how can one of the richest countries in the world be in so much debt? How can our government have allowed that to happen?

Keynes vs Friedman.

Governments have to spend their way out of recession, but to pay for that they also have to tax the rich during the boom (Keynes). Governments hate taxing the rich (Friedman, and he who pays the piper).

 

[ViolentPanda]

Isn't the problem that the country is in massive debt. As in, we owe shit loads of money to other countries (China?).

Not really. That'd only be a problem if we were in as deep as the US is (and has been since the 1970s). We're not.

Also that, as individuals, we are all massively in debt- like mortgages 5x salaries, loads of hire purchase. We've borrowed loads of money to live our (comparatively) luxury western lifestyles and now we're fucked.

Ask yourself why that's the case.
it's because we've been sold those lifestyles by Capital, the media and the politicians. They make money and get to exercise a fairly insidious form of social control at the same time.

Sorry for the lack of links, but that's my general understanding of why we have to cut Government spending by 25% in most departments. We have to pay back a big debt or we go bankrupt like Greece.

No, we don't, because our economy isn't constructed on the same foundations as Greece, and our credit rating isn't either (however much Standard and Poor might try to manipulate the lending market by making noises that imply otherwise).

 

[ViolentPanda]

Keynes vs Friedman.

Governments have to spend their way out of recession, but to pay for that they also have to tax the rich during the boom (Keynes). Governments hate taxing the rich (Friedman, and he who pays the piper).

Of course, if we're looking at it from a "what works" viewpoint, you'd choose Keynesianism every time. over Friedmanite economics. Only the former has worked when applied to "real life" economies rather than simplistic models.

 

[butchersapron]

What world do these grassroots lib-dems live in? It's not the real one:

The first up is Richard Grayson, the vice-chair of the Lib Dem federal policy committee who is pushing for his party to make relationships with Labour while party managers execute their current coalition – he's not a fan of what Clegg et al are doing, and his is a name you'll come to hear more and more of.

For it to happen, Grayson says the following four things need to happen:

• Labour must end tribalism (so that's less from John Reid and David Blunkett, he says)

• The Lib Dem party outside government has to start showing coordinated opposition ("Right now our efforts are like the French resistance of 1940: a few random acts of sabotage, very little sustained critique")

• The grass roots must start making friends, making the point that in times past attempts at Lib-Labbery had been attempted by "party elites" and now needs to be attempted by activists: "There needs to be a much better relationship between the two parties," he says

I've not been in the labour party for 20 years but i'd spit in your fucking face if you attempted to 'make friends' - you'll need friends to stop you drowning soon enough. I'd rather throw you a sack of stones as would most people.

 

[ymu]

Of course, if we're looking at it from a "what works" viewpoint, you'd choose Keynesianism every time. over Friedmanite economics. Only the former has worked when applied to "real life" economies rather than simplistic models.

Indeed. It's quite shocking how poor the dominant school of economics since the 1980s has been.

Another great article for Edie:

Few economists saw our current crisis coming, but this predictive failure was the least of the field’s problems. More important was the profession’s blindness to the very possibility of catastrophic failures in a market economy. During the golden years, financial economists came to believe that markets were inherently stable — indeed, that stocks and other assets were always priced just right. There was nothing in the prevailing models suggesting the possibility of the kind of collapse that happened last year. Meanwhile, macroeconomists were divided in their views. But the main division was between those who insisted that free-market economies never go astray and those who believed that economies may stray now and then but that any major deviations from the path of prosperity could and would be corrected by the all-powerful Fed. Neither side was prepared to cope with an economy that went off the rails despite the Fed’s best efforts.

And in the wake of the crisis, the fault lines in the economics profession have yawned wider than ever. Lucas says the Obama administration’s stimulus plans are “schlock economics,” and his Chicago colleague John Cochrane says they’re based on discredited “fairy tales.” In response, Brad DeLong of the University of California, Berkeley, writes of the “intellectual collapse” of the Chicago School, and I myself have written that comments from Chicago economists are the product of a Dark Age of macroeconomics in which hard-won knowledge has been forgotten.

http://www.nytimes.com/2009/09/06/magazine/06Economic-t.html?pagewanted=all

 

[Edie]

No offence ymu, but economics is blatantly a load of shit. They are completely unable to predict anything. They agree on nothing. You can support any argument you like with any number of economists. They don't know what they're fuckin on about.

If as a country we owe money, we need to repay it. And if we're spending more than we're making, then we need to spend less. It's not fuckin rocket science. These bastards are full of smoke and mirrors.

 

[kyser_soze]

TBF, Keynesianism only worked because of the pre-existing economic power of the countries that tried it at the time. As soon as the cheap oil and fixed exchange rates ran out, the whole thing fell apart.

 

[Proper Tidy]

No offence ymu, but economics is blatantly a load of shit. They are completely unable to predict anything. They agree on nothing. You can support any argument you like with any number of economists. They don't know what they're fuckin on about.

If as a country we owe money, we need to repay it. And if we're spending more than we're making, then we need to spend less. It's not fuckin rocket science. These bastards are full of smoke and mirrors.

Aye, these bastards are full of smoke and mirrors, and one of their tricks is to sell us all the idea that we have a deficit that needs repaying (panic panic), which means cuts to public services and a heavier burden on the poor. It's their hook; it is no different to the big lie about the pits being unprofitable - yet we now import vast amounts of coal! The truth is it is ideologically motivated. The cuts are bullshit.

Following WWII the UK's deficit was much, much higher as a proportion - yet the economy was boosted not by cuts but by spending, by creating the NHS and council housing and jobs; indeed, it was a period of huge investment in which swathes of Europe were rebuilt.

 

[Edie]

Aye, these bastards are full of smoke and mirrors, and one of their tricks is to sell us all the idea that we have a deficit that needs repaying (panic panic), which means cuts to public services and a heavier burden on the poor. It's their hook; it is no different to the big lie about the pits being unprofitable - yet we now import vast amounts of coal! The truth is it is ideologically motivated. The cuts are bullshit.

Following WWII the UK's deficit was much, much higher as a proportion - yet the economy was boosted not by cuts but by spending, by creating the NHS and council housing and jobs; indeed, it was a period of huge investment in which swathes of Europe were rebuilt.

What is the variation in the deficit over, say, the last 100 years. Is the amount the deficit is now significantly more than the average amount it's gone up and down?

Does anyone know the answer to that? I'm trying to say, how should we know whether to be worried if we don't believe the government?

 

[FreddyB]

No offence ymu, but economics is blatantly a load of shit. They are completely unable to predict anything. They agree on nothing. You can support any argument you like with any number of economists. They don't know what they're fuckin on about.

If as a country we owe money, we need to repay it. And if we're spending more than we're making, then we need to spend less. It's not fuckin rocket science. These bastards are full of smoke and mirrors.

The deficit is not the problem. The deficit is a symptom. The other option of course is to make more. How might we do that? Or put another way can you not see a connection between spending less and making less as a result?

 

[i_got_poison]

You do realise that Keynesian stimulus needs to be long-term, not just a three year wonder? That it needs to exceed the length of the economic problem it is deployed against?
Foolish question. You obviously don't.
Perhaps you might reflect on what would have occurred in the last three years if so many nation-states hadn't supported their economies and launched economic stimulus packages.

i agree stimulus was needed but in america, financial institutions aren't the only beneficiaries. the whole economy is being propped up.
for america to do this, it creates treasury bonds and gets friendly nations to buy them. when china sold £34.bn worth of US bonds earlier this year
japan intervened and started buying up the bonds. it's now the largest foreign holder of US treasuries. economically it makes no sense for japan to
do this, so we must assume they've been coerced. taiwan and south korea are also notably foreign t-bill holders.

what this all means is the uk isn't america. it can't run deficits of this magnitude in pertuity.

i've already mentioned this in another thread, though due to it's relevance i'll do so again, here. when the BoE dumps £200bn into the economy
it does so with the provision the money will be taken out of the real economy (i.e. private and public sector).

you can't say "go" quantative easing and in the same breath say "no" to public sector cuts.

things don't work like that.

 

[DotCommunist]

Indeed. It's quite shocking how poor the dominant school of economics since the 1980s has been.

Another great article for Edie:

Good article.

“We have involved ourselves in a colossal muddle, having blundered in the control of a delicate machine, the working of which we do not understand. The result is that our possibilities of wealth may run to waste for a time — perhaps for a long time.”

and here we are again.

 

[DotCommunist]

i agree stimulus was needed but in america, financial institutions aren't the only beneficiaries. the whole economy is being propped up.
for america to do this, it creates treasury bonds and gets friendly nations to buy them. when china sold £34.bn worth of US bonds earlier this year
japan intervened and started buying up the bonds. it's now the largest foreign holder of US treasuries. economically it makes no sense for japan to
do this, so we must assume they've been coerced. taiwan and south korea are also notably foreign t-bill holders.

what this all means is the uk isn't america. it can't run deficits of this magnitude in pertuity.

i've already mentioned this in another thread, though due to it's relevance i'll do so again, here. when the BoE dumps £200bn into the economy
it does so with the provision the money will be taken out of the real economy (i.e. private and public sector).

you can't say "go" quantative easing and in the same breath say "no" to public sector cuts.

things don't work like that.

Roosevelt did.

 

[butchersapron]

i've already mentioned this in another thread, though due to it's relevance i'll do so again, here. when the BoE dumps £200bn into the economy
it does so with the provision the money will be taken out of the real economy (i.e. private and public sector).

No it doesn't You're very very confused. It's the exact opposite.

 

[ymu]

No offence ymu, but economics is blatantly a load of shit. They are completely unable to predict anything. They agree on nothing. You can support any argument you like with any number of economists. They don't know what they're fuckin on about.

If as a country we owe money, we need to repay it. And if we're spending more than we're making, then we need to spend less. It's not fuckin rocket science. These bastards are full of smoke and mirrors.

Yeah. That's what the article I linked to says.

 

[ymu]

No offence ymu, but economics is blatantly a load of shit. They are completely unable to predict anything. They agree on nothing. You can support any argument you like with any number of economists. They don't know what they're fuckin on about.

If as a country we owe money, we need to repay it. And if we're spending more than we're making, then we need to spend less. It's not fuckin rocket science. These bastards are full of smoke and mirrors.

DP

 

[DotCommunist]

What is the variation in the deficit over, say, the last 100 years. Is the amount the deficit is now significantly more than the average amount it's gone up and down?

Does anyone know the answer to that? I'm trying to say, how should we know whether to be worried if we don't believe the government?

one thing to remember is that britain is a safe debt. We pay back- christ we only finished paying off the yanks for a massive post war debt a few years ago. But they got every penny. We may not be an economic powerhouse anymore but the country is capable of borrowing in large amounts because it is known that the wealth is here and debts will be paid. We could borrow heavily and invest in our economy, a tactic proven to get things back on an even keel. But the ideology of tory governance is set on slash and burn- squeeze blood from a stone. Big state is anathema to the political class in charge. More and more new quango quashers are finding there isn't actually any savings to be made as we are operating on a shoestring anyway.

 

[butchersapron]

.

Ex-cop [and union basher] Brian Paddick was quick to voice lavish support for Clegg at the rostrum yesterday, prompting thoughts that only modesty made him tell the BBC's Andrew Marr that other Lib Dem contenders for London mayor "could do a better job than I could".

 

[Proper Tidy]

What is the variation in the deficit over, say, the last 100 years. Is the amount the deficit is now significantly more than the average amount it's gone up and down?

Does anyone know the answer to that? I'm trying to say, how should we know whether to be worried if we don't believe the government?

The deficit is higher than in previous years. However, the point is it is manageable, and at far less cost for the vast majority of people than the cuts will be.

 

[i_got_poison]

No it doesn't You're very very confused. It's the exact opposite.

the exact opposite of what i said would mean the private and public sector create wealth to the tune of £200bn and the government
saves it for times when the country needs it.

this (as you can imagine) is a little hard to fathom, considering we aren't a creditor nation. neither do we have any gold reserves.
add to this a huge fiscal and national deficit and it's obvious the opposite isn't true.

trust you to say something stupid.

 

[butchersapron]

The BOE do expect the £200 billion they've sold not to be disappeared from circulation. The whole point is that it circulates. Contra your weird claim that they expect it to be taken out. You're a bit out of your depth here. And we're only paddling.

 

[butchersapron]

How many claims have you this arse over tit now? Winter-heating allowance ring-fenced = wrong, BOE wants to operate a tight monetarist policy by printing money = wrong, others?