Breadline Britain.

[*Belle*]

 

Have you have evidence of this 2 month deadline to financial apocalypse ? Would you make a wager ?

 

Evidence? Like a bit of insider trading then? I wish!! Just watching the trends. Maybe 2 months was a little pessimistic ** back pedals !! * but mark my words, a crash, the likes of which we've not seen in a while is coming.

[I1L2T3]

No one is saying we shouldn't invest, but before we can invest we need to get the debt under control, the investment should have happened 10 years ago instead of spending the money expanding an already over populated country and paying people to sit on their arses. You are stuck in the system that got us into the mess and your only answer is more debt, I agree, if we borrow more money and spend it on infrastructure we will get growth in the short term but in the long term our problems will just get worse.

 

My answer is productive borrowing to spend on things that in the long-run will yield more economically than they cost. I am absolutely against Osborne's non-productive borrowing. Borrowing to support failure is partly why he lost our AAA rating.

 

What would you like to stop spending money in order that we can spend it on universities?

 

As I've said many times on here we need a more streamlined, more efficient public sector. I don't go for the idea that the state should be cut back for the sake of cutting it back but rather we need to identify a level of spend that we can afford. Some people put this at 35-40% of GDP. You can't just hack and slash to get to that point because if that approach is taken the soft targets are gone for first:

 

1. The disabled

2. People who are already disadvantaged

3. Anyone else who can't fight back

 

and

 

4. Capital investment. This has been drastically cut back by Osborne. It's an easy target because the results of the cuts are not seen immediately. But long-term the damage to the economy can be considerable. When the Tories were last in power their capital investment record was abysmal (schools, transport, health etc...)

 

Cuts have to be done inteliigently. It's not simply a case of getting the numbers down.

 

Perhaps the main thing is to collect tax more effectively to pay for what we need. Either we need a HMRC with more teeth or a radical overhaul of the tax system. Both should be on the table.

 

Yet you think we can just magic money into existence to spend on infrastructure, at some point the population will have to fall, it can’t expand indefinitely, and it wouldn't take 100 years for the population to fall naturally.

 

The BofE has magically produced £375bn to help the banks.

 

No we are experiencing the inevitable consequences of over consumption, over population and an economic system that relying on perpetual debt and human expansion.

 

I totally agree on the over-consumption bit. And I agree that we need something more sustainable.

 

---------- Post added 30-03-2013 at 23:05 ----------

 

During the Thatcher years the UK stock market rose a massive 430%. That is one reason why overseas companies invested here and brought growth and jobs.

 

Between 1997 and 2010 the UK stock market grew by around 20%. That is negative growth if you allow for inflation. The only thing that expanded was the public sector that took on a million extra staff that the economy couldn't afford, and a burden on tax payers and companies alike. Despite the public sector expansion Labour left office with higher unemployment than in 1997 when they came to power.

 

At least the stock market is rising again and stands 20% higher than it did in May 2010. That at least encourages folk to invest in UK companies again. It is a pity that Gordon Brown abolished indexation for capital gains made on share investments. It certainly doesn't encourage long term share ownership on UK markets. But I still doubt that a rising market is enough to encourage large firms to locate here now the low wage economies have joined the EU.

 

The stock market bubble ended with a massive financial crisis, devaluation of the pound, exit from the ERM and interest rates at 15%.

 

In 2008 the end of another bubble ended in the near collapse of the banking sector.

 

Both parties had long periods in power. Both played their part in separate economic catastrophes.

 

Failures from both put decent hard working people into the gutter. I'm not going to argue in support of either of them.

[tinfoilhat]

My answer is productive borrowing to spend on things that in the long-run will yield more economically than they cost. I am absolutely against Osborne's non-productive borrowing. Borrowing to support failure is partly why he lost our AAA rating.

 

 

 

As I've said many times on here we need a more streamlined, more efficient public sector. I don't go for the idea that the state should be cut back for the sake of cutting it back but rather we need to identify a level of spend that we can afford. Some people put this at 35-40% of GDP. You can't just hack and slash to get to that point because if that approach is taken the soft targets are gone for first:

 

1. The disabled

2. People who are already disadvantaged

3. Anyone else who can't fight back

 

and

 

4. Capital investment. This has been drastically cut back by Osborne. It's an easy target because the results of the cuts are not seen immediately. But long-term the damage to the economy can be considerable. When the Tories were last in power their capital investment record was abysmal (schools, transport, health etc...)

 

Cuts have to be done inteliigently. It's not simply a case of getting the numbers down.

 

Perhaps the main thing is to collect tax more effectively to pay for what we need. Either we need a HMRC with more teeth or a radical overhaul of the tax system. Both should be on the table.

 

 

 

The BofE has magically produced £375bn to help the banks.

 

 

 

I totally agree on the over-consumption bit. And I agree that we need something more sustainable.

 

---------- Post added 30-03-2013 at 23:05 ----------

 

 

The stock market bubble ended with a massive financial crisis, devaluation of the pound, exit from the ERM and interest rates at 15%.

 

In 2008 the end of another bubble ended in the near collapse of the banking sector.

 

Both parties had long periods in power. Both played their part in separate economic catastrophes.

 

Failures from both put decent hard working people into the gutter. I'm not going to argue in support of either of them.

 

You are in good company re: infrastructure investment http://www.bbc.co.uk/news/world-us-canada-21975099

 

If only Obama can get the two houses to agree on something it might work. As that won't happen he can say anything and nowt will get done.

[MrSmith]

My answer is productive borrowing to spend on things that in the long-run will yield more economically than they cost. I am absolutely against Osborne's non-productive borrowing. Borrowing to support failure is partly why he lost our AAA rating.

 

So again what non productive borrowing are you going to cut in order to borrow the money to spend on infrastructure, labour expanded the public sector and increased the benefits system and we have to borrow money to support them, they need cutting so money can be used more productively, but the cuts are unpopular so will have to be done very slowly, it will take longer for it to become sustainable so it will take longer before we have the funds to spend on infrastructure.

Budget 2013: chancellor pledges extra £3bn for infrastructure projects

Osborne said the government was "already supporting the largest investment in railways since Victorian times and spending more on new roads than in a generation".

 

 

 

 

As I've said many times on here we need a more streamlined, more efficient public sector. I don't go for the idea that the state should be cut back for the sake of cutting it back but rather we need to identify a level of spend that we can afford. Some people put this at 35-40% of GDP. You can't just hack and slash to get to that point because if that approach is taken the soft targets are gone for first:

 

1. The disabled

2. People who are already disadvantaged

3. Anyone else who can't fight back

 

So what would you stop spending money on, who would suffer or do you know a way to cut without it affecting anyone.

 

 

 

 

4. Capital investment. This has been drastically cut back by Osborne. It's an easy target because the results of the cuts are not seen immediately. But long-term the damage to the economy can be considerable. When the Tories were last in power their capital investment record was abysmal (schools, transport, health etc...)

 

I haven't seen much infrastructure spending over the past decade because it appeared labours priority was to increase the size of the wasteful public sector and increase the benefits system and population, all need cutting. How will you reduce spending on these so that we have the funds to spend on repairing the roads?

 

 

 

Cuts have to be done inteliigently. It's not simply a case of getting the numbers down.

 

So what would you cut and how much would it save?

 

 

Perhaps the main thing is to collect tax more effectively to pay for what we need. Either we need a HMRC with more teeth or a radical overhaul of the tax system. Both should be on the table.

 

Not sure the productive members of society are going to be happy at paying more tax in order to support then none productive members of society. The private sector needs making more efficient before we resort to taxing people more, higher taxes wouldn’t attract inward investment. Companies want to set up in low tax countries.

 

You are stuck in Labours ideology, borrow more, tax more and spend more. We just had 13 years of that and look where we are now.

 

 

 

The BofE has magically produced £375bn to help the banks.

 

And it didn't work.

 

I totally agree on the over-consumption bit. And I agree that we need something more sustainable.

So we need to cut consumption and decrease our dependence on debt.

[I1L2T3]

So again what non productive borrowing are you going to cut in order to borrow the money to spend on infrastructure, labour expanded the public sector and increased the benefits system and we have to borrow money to support them, they need cutting so money can be used more productively, but the cuts are unpopular so will have to be done very slowly, it will take longer for it to become sustainable so it will take longer before we have the funds to spend on infrastructure.

Budget 2013: chancellor pledges extra £3bn for infrastructure projects

Osborne said the government was "already supporting the largest investment in railways since Victorian times and spending more on new roads than in a generation".

 

The first bit of the spending that needs to be tackled is Housing Benefit. Because of the way the housing market has developed it so often is basically a subsidy for private landlords. The total cost is approaching £30bn and there are now around 5 million claimants. Private landlords can't sponge off the state any more - they have to take a hit for their poor investments.

 

Similarly, tax credits are used to top up inadequate wages. Tax credits need to be looked at too. The key is to deal with the underlying reasons for high living costs - housing is number one on that list of reasons.

 

Then we move onto the cost of pensions and other benefits for pensioners. Vince Cable is right that the more well off pensioners shouldn't be taking a bus pass, shouldn't be getting help with heating etc... Taking from pensioners is a tough call but given that they account for approaching 50% of welfare spending it has to be considered.

 

We also need to collect tax more effectively. The recent staffing cuts at HMRC are not going to help with that.

 

£3bn on infrastructure is piddling in the wind. Osborne has done that as a token gesture after realising his mistake while still trying to pretend his original plan was correct.

 

He should be listening to industry:

http://uk.reuters.com/article/2013/03/20/uk-britain-budget-infrastructure-idUKBRE92J10020130320

 

So what would you stop spending money on, who would suffer or do you know a way to cut without it affecting anyone.

 

Some people will suffer from streamlining and cuts. I'm not for one minute suggesting otherwise. The key to such a process is fairness..

 

 

I haven't seen much infrastructure spending over the past decade because it appeared labours priority was to increase the size of the wasteful public sector and increase the benefits system and population, all need cutting. How will you reduce spending on these so that we have the funds to spend on repairing the roads?

 

There was a lot under labour. Unfortunately they didn't invest in housing. And when they did invest they made the massive mistake of using PFI too freely to try and keep infrastructure spending off the balance sheet. A mistake the Tories now seem happy to repeat.

 

So what would you cut and how much would it save?

 

See above for starters.

 

Not sure the productive members of society are going to be happy at paying more tax in order to support then none productive members of society. The private sector needs making more efficient before we resort to taxing people more, higher taxes wouldn’t attract inward investment. Companies want to set up in low tax countries.

 

People get paid so much because living costs are so high. We need to tackle the causes of that.

 

You are stuck in Labours ideology, borrow more, tax more and spend more. We just had 13 years of that and look where we are now.

 

No, I'd rather we collect the tax that is due. We don't do that.

 

I believe in productive borrowing. I don't believe in Osborne's non-productive borrowing to support failure.

 

Osborne will borrow more in 5 years than Labour did in 13 years. That's a home truth everybody should know about

 

And it didn't work.

 

Because such money generation is non-productive. It props up a failed sector of the economy that currently generates negative economic growth.

 

So we need to cut consumption and decrease our dependence on debt.

 

Absolutely agree.

[Shef_Fitness]

This is a recession that siimply has no end. This is permanent no matter who is in power.

 

I think the problem started around 1999/2000 when people were paid more to not work. I think the 1990s were the last decade of common sense.

 

In the early 2000s when there was a boom, the brits were paid to not and somebody had to do the work the brits wouldn't do. In the 1990s, manual/rubbish/factory jobs were done by the locals, I know because I left school without qualifications and worked in these factorys.

 

More people came into the country, the cost of housing went through the roof (supply and demand), while benefit oayments went up to cover this, peoples who were in work, there wages did not go up.

 

In the 1990s, kids used to dread losing their jobs because they would be financially worse off, it seems in 2013, kids dread getting a job for exactly the same reasons we feared getting the sack

 

Its a real old mess and god knows how things are going to work out. We have to get back to a situation where the person in work is able to afford the things my generation took for granted (a home, car, comfy standard of living). Its only 12 years or so ago that if you had a full time job then you were pretty much sorted for all your financial needs.

[gnvqsos]

This is a recession that siimply has no end. This is permanent no matter who is in power.

 

I think the problem started around 1999/2000 when people were paid more to not work. I think the 1990s were the last decade of common sense.

 

In the early 2000s when there was a boom, the brits were paid to not and somebody had to do the work the brits wouldn't do. In the 1990s, manual/rubbish/factory jobs were done by the locals, I know because I left school without qualifications and worked in these factorys.

 

More people came into the country, the cost of housing went through the roof (supply and demand), while benefit oayments went up to cover this, peoples who were in work, there wages did not go up.

 

In the 1990s, kids used to dread losing their jobs because they would be financially worse off, it seems in 2013, kids dread getting a job for exactly the same reasons we feared getting the sack

 

Its a real old mess and god knows how things are going to work out. We have to get back to a situation where the person in work is able to afford the things my generation took for granted (a home, car, comfy standard of living). Its only 12 years or so ago that if you had a full time job then you were pretty much sorted for all your financial needs.

 

Given the advantages of not working I cannot understand why you have a business.

 

PS a permanent recession means output will fall to zero!

[MrSmith]

The first bit of the spending that needs to be tackled is Housing Benefit. Because of the way the housing market has developed it so often is basically a subsidy for private landlords. The total cost is approaching £30bn and there are now around 5 million claimants. Private landlords can't sponge off the state any more - they have to take a hit for their poor investments.

 

I agree, and population reduction would solve that problem, building more houses for an increasing population will just drive prices higher.

 

 

Similarly, tax credits are used to top up inadequate wages. Tax credits need to be looked at too. The key is to deal with the underlying reasons for high living costs - housing is number one on that list of reasons.

I agree, reducing the population will free up more money and lower living costs, increasing the population will drive living costs higher.

 

Then we move onto the cost of pensions and other benefits for pensioners. Vince Cable is right that the more well off pensioners shouldn't be taking a bus pass, shouldn't be getting help with heating etc... Taking from pensioners is a tough call but given that they account for approaching 50% of welfare spending it has to be considered.

 

Getting everyone that can work longer to work longer, whilst reducing the population will solve that problem.

 

 

 

We also need to collect tax more effectively. The recent staffing cuts at HMRC are not going to help with that.

 

Making the tax system less complicated and reducing tax will mean more people will pay it, lower taxes gives people less incentive to find ways to avoid them. Increasing Vat on none essentials is a better way to tax people.

 

 

 

 

£3bn on infrastructure is piddling in the wind. Osborne has done that as a token gesture after realising his mistake while still trying to pretend his original plan was correct.

 

 

He should be listening to industry:

http://uk.reuters.com/article/2013/03/20/uk-britain-budget-infrastructure-idUKBRE92J10020130320

That was in increase of £3bn which is raised by saving in all departments, but we still have the problem of borrowing money just to pay for the unsustainable public sector wages and benefits system.

 

Some people will suffer from streamlining and cuts. I'm not for one minute suggesting otherwise. The key to such a process is fairness..

Its fare that the people that contribute the least suffer the most, there is no point in making the people that contribute the most, suffer the most because they will just leave.

 

There was a lot under labour. Unfortunately they didn't invest in housing. And when they did invest they made the massive mistake of using PFI too freely to try and keep infrastructure spending off the balance sheet. A mistake the Tories now seem happy to repeat.

 

The governmnet doesn't have the money to invest, it has to be raised from the private sector.

 

 

People get paid so much because living costs are so high. We need to tackle the causes of that.

Living costs are high because we are over populated and don't have the resources to sustain the population, we are reliant on buying food and energy from abroad.

 

 

No, I'd rather we collect the tax that is due. We don't do that.

How much are people and companies illegally not paying?

 

 

I believe in productive borrowing. I don't believe in Osborne's non-productive borrowing to support failure.

They have no choice because they have to borrow to bay for the over sized public sector and benefits system, when they have been cut to the point they are affordable, the government will have money to spend on more important things.

 

Osborne will borrow more in 5 years than Labour did in 13 years. That's a home truth everybody should know about

 

That’s an inevitable consequence of an expanding population, public sector and generous benefits system.

 

Because such money generation is non-productive. It props up a failed sector of the economy that currently generates negative economic growth.

Without that sector there couldn't be any growth, all growth stems from the money they lend.

 

Absolutely agree.

 

The problem being that consumption can only be cut in a decreasing population with a lower standard of living.