When wil this austerity madness end!
- Thread starter AronSearle
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I never said things were easy, and the construction industry has been hit hard (but then our construction industry is all messed up anyway, to many big boys, just like to many big banks, to many of the wrong kinds of properties being built).
But we are still a multi trillion pound economy, with good market relations outside of the EU, and if we spent more time focusing on the commonwealth instead of the EU, that would get better.
Our economy is pretty healthy, what isn't is the overspending government, which could drag down the economy if it isn't sorted.
And this isn't a labour/conservative stimulus/austerity issue, you just can't keep running a 10% deficit on failed initiative after failed initiatives, inflated public sector wages (on management) and high taxes, these things hurt any economy.
We also have hordes of low skilled unemployed/unemployable, but have done for years. That's a social issue, not an economic one, we have socially decided that working for less than X is unacceptable = unemployment.
It's the debt Aron. The only approach to debt is to pay it off, unfortunately that is now impossible as it's too large and our economy is long-term stuffed. The second best approach is to reduce the interest rate you pay to service the debt (what guvmint is trying to do). The bad approach is to borrow more (what guvmint is forced to do primarily because of what happened before).
Then there is individual and corporate debt. All the above apply.
Then there is individual and corporate debt. All the above apply.
Debt interest is currently just shy of 50 billion, we take about 550-600 bilion in tax and spend about 650-700 billion
In my opinion we should be looking at cutting taxes for the poor (anyone under 14k, and certainly not raising taxes for anyone else (taxing the rich more is just envy, historically it doesn't actually raise more money).
So you can see debt currently isn't an credit issue.
The issue is that as government keeps overspending, it keeps having to spend more of it's budget on debt interest, meaning it then needs to raise more tax just to keep services level, but tax receipts are falling, so it get's more debt, which means less for services.
It's the government chasing it's own debt tail.
It's still at manageable levels, and will be for a few years. But the issue isn't default (our economy is still to strong for that to be a risk), the risk is that our services will collapse as we have to spend more and more of the tax income on debt interest.
In my opinion we should be looking at cutting taxes for the poor (anyone under 14k, and certainly not raising taxes for anyone else (taxing the rich more is just envy, historically it doesn't actually raise more money).
So you can see debt currently isn't an credit issue.
The issue is that as government keeps overspending, it keeps having to spend more of it's budget on debt interest, meaning it then needs to raise more tax just to keep services level, but tax receipts are falling, so it get's more debt, which means less for services.
It's the government chasing it's own debt tail.
It's still at manageable levels, and will be for a few years. But the issue isn't default (our economy is still to strong for that to be a risk), the risk is that our services will collapse as we have to spend more and more of the tax income on debt interest.
Yes joe, everyone is broke and the 2 trillion pound economy we have just disappeared, and unemployment is 100% 
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You obviously aren't in business - it's that top few percent that is your profit - lose that and you don't have a business - you have a hobby.
The UK has lost that top few percent.
If Tesco lost 10% profit - they would go bust.
The UK has lost that top few percent.
If Tesco lost 10% profit - they would go bust.
Sadly though, Joe is mostly right...(As I blame a lot of the causes on a certain senile old b*tch...Now I like Joe and I like Aaron but which is better ........ I agree with Aaron`s arguments
)Think of it this way..
It's ok to have a massive mortgage for years on end whilst you have an income that covers the payments...
However if you don't make provision to pay that mortgage off, or reduce it as you go along, then when you get to the point where you can no longer maintain the required income you are f'cked...
The UK is very soon to hit that point as we have no resources, don't make much that other people want, and are unable to feed/power ourselves...
Now who would invest in a country like that!
You would have to downsize. hope somebody can afford to pay tle price you want for your house. you would of course be able to squeeze the seller of your new house as he will be in same position too.
All part of the standard of living slide that's on the way.
Not sure why anybody else is to blame for buying your house except you.
But your analysis of the future potential of the UK is reasonable. banks not repossessing houses as they would have to write the loss off and their balance sheets are not tough enough. only storing up bigger problems for future of course but kicking the can down the street is the order of tle day
All part of the standard of living slide that's on the way.
Not sure why anybody else is to blame for buying your house except you.
But your analysis of the future potential of the UK is reasonable. banks not repossessing houses as they would have to write the loss off and their balance sheets are not tough enough. only storing up bigger problems for future of course but kicking the can down the street is the order of tle day
An economy is not a household budget.
And the government is not the UK, it's the government that is having troubles with it's money, and all the industries that have become to dependant upon the government rather than free enterprise.
We have hundreds of years of shale gas, plenty of coal and metals. Germany has less resources than us, they manage, resources can be bought and sold as products or used for fuel etc.
Our export market must be an illusion then, even though we have manufacturing, i suppose you are one of those economic illiterates that thinks we should be making cheap tat like china because services are worthless.
It should be run as such though...hence why it's all gone t*ts up!
corrected for you...
The coal is economically unrecoverable (thanks to the b*tch), and the others only economic when we can't afford them ourselves!
Nope, just one of the economic literates who can read the percentage that manufacturing contributes to the economy...and could you perchance point us to the trade balance figures?
Oh, and as to our ability to feed/power ourselves...
We are a net importer of fuel/energy, and as for food..
Linky
There have been two major problems over the last 20 years which will keep us in sh1t street for the next 30 years. First is that governments bought votes by paying people far too much money to keep quiet and do nothing. Maggie started it but Bliar took it to new levels and Gordo took it into the stratosphere. Great while he lived in his fantasy world of boom, boom, boom - the money will never end. Not so great when we ended up in trillions of debt with no way to pay it back.
The second is the real debt legacy of the last labour government which is yet to really kick in. They signed hundreds and hundreds of capital construction and civil engineering projects on private finance initiatives. Most of them on unbelievable rates to be paid over 25 year periods. Of course it looked good building new hospitals, schools, roads etc, but the future cost is staggering and will hold us back for 25 to 30 years minimum. Most haven't properly kicked in yet but they will. And incidentally, all the dosh goes to the enemy of the people. Big business!
So when people wish for a new labour government to get back in as quickly as possible so we can all get our benefits reinstated and chuck a nice big pay rise to the public sector. Dream on. There's nowt in the kitty and won't be for the forseeable.
The second is the real debt legacy of the last labour government which is yet to really kick in. They signed hundreds and hundreds of capital construction and civil engineering projects on private finance initiatives. Most of them on unbelievable rates to be paid over 25 year periods. Of course it looked good building new hospitals, schools, roads etc, but the future cost is staggering and will hold us back for 25 to 30 years minimum. Most haven't properly kicked in yet but they will. And incidentally, all the dosh goes to the enemy of the people. Big business!
So when people wish for a new labour government to get back in as quickly as possible so we can all get our benefits reinstated and chuck a nice big pay rise to the public sector. Dream on. There's nowt in the kitty and won't be for the forseeable.
