The lunatics are back in charge of the economy and they want cuts, cuts, cuts

[barjon]

........................This government has to take stern measures and if the UK does not accept them we really are going to screw future generations. Its as simple as that..............

Oh, I don't disagree with that, Split. It's just that I don't think that the situation is really as dire as it's made out to be. After all there's a massive chunk of the debt that's going to result in a healthy profit in the future (no surprise the Chancellor is reported as not favouring selling the stake in the banks) or that will result in a lower future spend on infrastructure.

As for the mirror image, I don't think you can have it both ways. If, as Governments claim, tax cuts and increased spending stimulate economic growth then they cannot claim that tax rises and reduced spending will not do the reverse.

Of course, it may be that Governments kid themselves about the effect that their clever measures actually have on the economy, but that's another story.

jon

 

[Splitlink]

Oh, I don't disagree with that, Split. It's just that I don't think that the situation is really as dire as it's made out to be. After all there's a massive chunk of the debt that's going to result in a healthy profit in the future (no surprise the Chancellor is reported as not favouring selling the stake in the banks) or that will result in a lower future spend on infrastructure.

As for the mirror image, I don't think you can have it both ways. If, as Governments claim, tax cuts and increased spending stimulate economic growth then they cannot claim that tax rises and reduced spending will not do the reverse.

Of course, it may be that Governments kid themselves about the effect that their clever measures actually have on the economy, but that's another story.

jon

Jon, I do, really, believe that this is serious. But I hope that you are right. I am, of course, looking at the UK's problems from outside but here it is much worse. Unfortunately, we have not been able to get our government changed--you have and I hope that you have voted correctly. Our possible salvation could be Brussels which is frightened stiff of a domino effect following Greece and is turning the screws on us. Without that, Zapatero and his bunch would not be doing a damned thing.

We have 20% unemployed. 40% of our youngsters can't get work.

 

[barjon]

............We have 20% unemployed. 40% of our youngsters can't get work..........

split

Yes, and what they need is a strong upturn in the Spanish economy - not measures that might make their plight even worse.

No-one doubts that the debt problem is serious from a fiscal point of view (although over-blown as I opined earlier), but it's as well to remind ourselves that people are involved. Sure, servicing current debt might put a dent or two in the pockets of future generations, but trying to solve it too quickly risks creating a lost generation here and now as your stark statistics demonstrate.

jon

 

[Splitlink]

split

Yes, and what they need is a strong upturn in the Spanish economy - not measures that might make their plight even worse.

No-one doubts that the debt problem is serious from a fiscal point of view (although over-blown as I opined earlier), but it's as well to remind ourselves that people are involved. Sure, servicing current debt might put a dent or two in the pockets of future generations, but trying to solve it too quickly risks creating a lost generation here and now as your stark statistics demonstrate.

jon

It won't just put a dent, the private debt will get to the stage where it will be impossible to service it without bankruptcy. Germany is protesting like mad and that is most of the problem (I don't blame them, either) plus, it must be remembered, Spain is nowhere near the only EU country in trouble.

The main industry has been construction. That is dead and there are hundreds of thousands of unsold flats on the market, all of them with mortgages. Lots of British retirees are having to go home because their pensions have devalued with the GBP and they can no longer afford to live here.

Private debt, BTW, is 150% of GDP. I don't know how much that compares with the UK.

 

[LondonJimmy]

The OP must be some sort of loon that thinks the answer to being in debt is to borrow more.

His posts look like they were written in crayon.

 

[counter_violent]

A guy walked into our local hostelry and plonked down £50 as security while he went to inspect the master suite to see if it was suitable for a week-end romp with his young lady. The Landlord promptly whipped round to the local off-licence with the £50 and paid his outstanding bill for a few bottles of scotch he'd bought in an emergency. The off-licence guy whizzed with the £50 to his dentist and paid off his outstanding bill with it. The dentist owed his receptionist £50 so he gave it to her. The receptionist doubled as an "escort" and nipped round to the local hostelry to pay the Landlord her outstanding bill for a room she had hired for the afternoon. Just as she left the guy came down from the master-suite saying it wasn't suitable and the Landlord gave him his £50 back.

Nobody had done anything or produced anything but, VOILA, suddenly no-one was in debt anymore and everyone went their merry way.

jon

Which dentist did you say she worked for ?

 

[scose-no-doubt]

Aw, Paul, cummon, it's all a permanent three card trick anyway.

A guy walked into our local hostelry and plonked down £50 as security while he went to inspect the master suite to see if it was suitable for a week-end romp with his young lady. The Landlord promptly whipped round to the local off-licence with the £50 and paid his outstanding bill for a few bottles of scotch he'd bought in an emergency. The off-licence guy whizzed with the £50 to his dentist and paid off his outstanding bill with it. The dentist owed his receptionist £50 so he gave it to her. The receptionist doubled as an "escort" and nipped round to the local hostelry to pay the Landlord her outstanding bill for a room she had hired for the afternoon. Just as she left the guy came down from the master-suite saying it wasn't suitable and the Landlord gave him his £50 back.

Nobody had done anything or produced anything but, VOILA, suddenly no-one was in debt anymore and everyone went their merry way.

jon

Well that's not strictly true is it. Assets and liabilities are by definition, resultants of past actions.
The liabilities existed because one party had the benefit of some one else's output whether that be a product or service.
The asset was the other side of this transaction on the other party's balance sheet.
The cash just facilitated the liquidation of the assets and settlement of liabilities.

 

[Pat494]

The past and probably present politicians are unable to govern sensibly imho

Just consider these 2 cases

Further to the Ian Huntley murders I heard on R4 last week. that last year £15m was paid out to prisoners in jail in compensation. We, the taxpayers, may have to give the ******* £10k for petty injuries received from another prisoner.
I beleive in Christian charity and all that but really !!

John Venables rules in his cell block apparently ! He plays computer games most of the day, is waited on by hand and foot by the guards and threatens legal action if they don't jump to his every wish !!

We live in the world of Alice in Wonderland created by do-gooders and well meaning twats

 

[counter_violent]

:idea:I feel a new law coming on.

Anyone who is detained at maj's pleasure should be charged board and lodgings on a sliding scale according to means. That would sort out some of the cost...so then even if Huntley was awarded damages he would have to pay it all back...I expect it would sort out the over crowding problem as well....sod going to prison, it's going to cost money.

How about it (call me Dave) ?

 

[scose-no-doubt]

I'm for buying an island, shipping prisoners onto it and paying people from the third world a relatively modest sum to guard it.

 

[anley]

Kill all politicians and let bill gates and richard branson and nouriel roubini take the helm

And guess what their first decision would be?

To cut spending because it's common sense and the only option available.

People who say 'it's madness' are idiots because a) where is the money going to come from (it can only be borrowed), and b) they will just create a far larger problem 2-6 years down the road which is what's happening right now.

Every country in trouble had the chance to take stiff measures and sort the foundations out a few years back. But oh no, they had a better plan - to use band aids on the wounds because they were scared to inflict paiin on the economy. And sure enough for a bit of time the wounds were hidden under nice clean bandages.

But as everyone will know who's been bandaged up they look great when leaving the hospital. But what about 1 week later - that's the mess we're in now.

The paradox to the whole mess is this - the politicians got us into the trouble but they're the ones tasked with getting us out. Yes, you can blame the bankers but why? Greed is what they do and if left unchecked (by the politicians) they were always going to go mad, as they continue to do in the future if again left unchecked.

All this means that instead of the problems lasting 1-2 years before a proper recovery, with sound foundations, it's probably going to take at least 5 years if not longer............

 

[Pat494]

I would like to see Performance related pay, on Britain plc, for politicians

That would mean Gordon Brown & co would be deeply in debt like the country NOT swanning around the world like Blair on huge hand-outs, pensions perks etc. etc.

Another game of croquet John or a bit more bonking ??