Bolitics The New Condem Government

[avfc89]

People from Sheffield are fuming with Nick Clegg, it will be interesting to see what he has to say about the cuts, he probably doesn't care because there's no election coming up in the near future.

[snowychap]

a structural deficit of 180 billion pounds

I've been reading a few people's thoughts on the idea of a 'structural' deficit (mainly because of the finger in the air assumptions which calculation of it entails - the output gap, &c.) but without even getting in to the discussion of whether it is a helpful concept, the OBR's estimate of the cyclically-adjusted deficit is 8.8% of GDP (for this year) which wouldn't is much, much less than £180 thousand million.

[leviramsey]

So why can UK consumers not be encouraged to buy that produce? Why is that notion ludicrous?

The interesting question is how much of the British manufacturing industry is items that don't get purchased by consumers: heavy industrial equipment, precision medical/technical equipment etc. Consumer goods, by and large, are easy to make and thus tend to be low-margin, which is why they get made in low-cost places like China. When you get into non-consumer goods, they're more likely to be higher-margin and thus able to be made in higher-cost places like the UK.

[Awol]

So why can UK consumers not be encouraged to buy that produce? Why is that notion ludicrous?

The interesting question is how much of the British manufacturing industry is items that don't get purchased by consumers: heavy industrial equipment, precision medical/technical equipment etc. Consumer goods, by and large, are easy to make and thus tend to be low-margin, which is why they get made in low-cost places like China. When you get into non-consumer goods, they're more likely to be higher-margin and thus able to be made in higher-cost places like the UK.

Granted and that is a good question - one that I don't know the answer to off hand. Perhaps another question that leads out of that is what cultural/process changes need to happen in order to produce domestically manufactured consumer goods at a competitive price? I'm thinking clothes, electronic goods etc.

[leviramsey]

Granted and that is a good question - one that I don't know the answer to off hand. Perhaps another question that leads out of that is what cultural/process changes need to happen in order to produce domestically manufactured consumer goods at a competitive price? I'm thinking clothes, electronic goods etc.

Dramatically lower wages (along with substantial reductions in welfare payments, because I suspect that the wages would have to be lower than what one could get in benefits)?

There're very good reasons that production of those sorts of goods left for China and there's no way to bring them back without reducing the standard of living in the UK (either you increase the prices for those goods to the point that it makes sense to produce them domestically or you decrease wages to the point that it makes sense to produce them domestically or some combination thereof... any one of those results in a net decline in real incomes, especially at the lower end of the socioeconomic scale).

[villa_shere]

can't see why £1.1bn needs to be spent on the A14 in the first place. All that needs to happen is to cut out the needless stop by the M1 and make the merger from the M6 a bit better and try and put in a relief road by the two major roundabouts between the M6 and Cambridge and that would help traffic flow much better.

They do have traffic modelling though, it ain't just guesswork. Sometimes what seems obvious just moves the congestion a few miles up the road

which is why they need to address how the traffic moves from the M6 to the A14. It's ridiculous that junction. The flow from a major motorway onto one of the key routes to the eastern coast and Norfolk needs to be better than what is in place already.

So often at peak times traffic ends up backing down the M6 turning that part of the motorway into a dual carrigeway.

Another subject that annoys me is traffic lights, so often it could be sorted by intelligent sensor systems which appear to used in few places in towns like Warwick and Stratford-upon-avon.

Sitting at traffic lights at 1am waiting for them to go green, ridiculous. I'd love some clever boff to work out how much C02 would be saved from having these intelligent sensors in place in every major set of lights in the UK. Bet it would be a fair few thousand tonnes a year.

We rely too much on roads in this country considering how small we are. But with trains not really competitive on price with the car it's no wonder why traffic is slowly getting worse as the years go on.

I just hope the new government review the high speed rail proposal and do it properly.

Gutted! i was going to get a jon on this project until they 'suspended' the project. £1.1bn would have been spent over 5 years and majority of that money would have been spent within the UK.

The project was required mainly because of how danergous the road is. M1 Jct 19 (A14) has a really high number of accidents and this project could have prevented some of them.

[drat01]

VS - so what does that mean for you now, dole?

[Awol]

a structural deficit of 180 billion pounds

I've been reading a few people's thoughts on the idea of a 'structural' deficit (mainly because of the finger in the air assumptions which calculation of it entails - the output gap, &c.) but without even getting in to the discussion of whether it is a helpful concept, the OBR's estimate of the cyclically-adjusted deficit is 8.8% of GDP (for this year) which wouldn't is much, much less than £180 thousand million.

I haven't had chance to look at anything from the OBR but I thought our GDP was in the region of 1.6 trillion. I'm sure someone with a bigger calculator than me can do the maths on 8.8% of that. Even if 180 billion - - as was being estimated quite recently - is over the odds the numbers involved should still cause anyone with an ounce of sense to shit their pants.

[snowychap]

I haven't had chance to look at anything from the OBR but I thought our GDP was in the region of 1.6 trillion.

I believe the £180 thousand million estimate was one from a while back about the overall deficit (and that has since come down to around 155).

...the numbers involved should still cause anyone with an ounce of sense to shit their pants.

Why, though?

I'm not saying that to be contrary, mate. It appears that the media and the politicians are leading the hysteria whereas most of the economists (rather than the economic commentators) discussing the situation are less concerned by the numbers but what they mean and how one seeks to address the situation.

Take Huhne on Question Time the other night when he was likening our debt situation to Greece (in terms of the possibility of it becoming like Greece) and yet, again from what I've read, one isn't comparing eggs and eggs in doing that. Not all debt is the same and, apparently, our debt is substantially longer term than that of Greece (or Spain and others, I believe) which means that we have to refinance much less than those countries in any one year. That makes us less susceptible to the vagaries and whims of those willing to lend than somewhere like Greece - the figures that I seem to remember being spoken about were Greece having to refinance around a quarter of its debt each year whereas we only have to do around 7%.

[tonyh29]

The minister also said a total of £80,662 had been spent on new stock in 2009-10, adding: "This was itself a reduction on the 2008-09 figure of over 30%."

in your haste to condemn everything Tory you missed the obvious fact that the previous government spent the other £62,000 this year and had been spending even more of that every previous year .....

fine wines , how very working mans party ..wonder if they used to serve it in a pint glass with accompanied by a packet pork scratchings ??

as own goals go this is one of your better ones , just hope you are not Colombian

[drat01]

and again Tony you miss the point in a Emile Heskey style. While Cameron and Clegg are calling for costs to be cut all over (we are all in this together - bollox!) and the age of the freeloader MP still upsets many of the electorate, the ConDem's prove straight away that they preside over a parliament that is the same if not worse than previous ones.

But in your quickness to defend anything Tory influenced you to obviously miss the obvious. You really should start reading the posts

[tonyh29]

To be fair one doesn't need to read your posts to know the content and hypocrisy involved in them :-)

[peterms]

Granted and that is a good question - one that I don't know the answer to off hand. Perhaps another question that leads out of that is what cultural/process changes need to happen in order to produce domestically manufactured consumer goods at a competitive price? I'm thinking clothes, electronic goods etc.

Dramatically lower wages (along with substantial reductions in welfare payments, because I suspect that the wages would have to be lower than what one could get in benefits)?

There're very good reasons that production of those sorts of goods left for China and there's no way to bring them back without reducing the standard of living in the UK (either you increase the prices for those goods to the point that it makes sense to produce them domestically or you decrease wages to the point that it makes sense to produce them domestically or some combination thereof... any one of those results in a net decline in real incomes, especially at the lower end of the socioeconomic scale).

It is indeed important for the Tory project to reduce wages and benefits (though probably not in order to challenge China in the production of cheap consumer goods).

A recent letter to the Guardian quoted Alan Budd, an economist prominent in the Thatcher experiment:

As the Robbespierrean-sounding Office for Budget Responsibility begins to assert its public profile (Osborne cites deficit as he toughens budget plan, 15 June), its distinguished interim chair would do well to draw on the lessons of experience.

At the conclusion of Adam Curtis's 1992 documentary exposé of the destructive monetarist fantasies of Thatcherism, The League of Gentlemen, Alan Budd offers the following sombre observations on the 1980s policies for which he supplied the gloss of supposed economic objectivity: "The nightmare I sometimes have about this whole experience runs as follows … there may have been people making the actual policy decisions … who never believed for a moment that this was the correct way to bring down inflation. They did, however, see that it would be a very, very good way to raise unemployment. And raising unemployment was an extremely desirable way of reducing the strength of the working classes … that what was engineered there, in Marxist terms, was a crisis of capitalism which recreated a reserve army of labour and has allowed the capitalists to make high profits ever since."

In view of his new role, we can only hope that Budd is this time confronting the political agenda behind his economic analysis with his eyes wide open.

[leviramsey]

Granted and that is a good question - one that I don't know the answer to off hand. Perhaps another question that leads out of that is what cultural/process changes need to happen in order to produce domestically manufactured consumer goods at a competitive price? I'm thinking clothes, electronic goods etc.

Dramatically lower wages (along with substantial reductions in welfare payments, because I suspect that the wages would have to be lower than what one could get in benefits)?

There're very good reasons that production of those sorts of goods left for China and there's no way to bring them back without reducing the standard of living in the UK (either you increase the prices for those goods to the point that it makes sense to produce them domestically or you decrease wages to the point that it makes sense to produce them domestically or some combination thereof... any one of those results in a net decline in real incomes, especially at the lower end of the socioeconomic scale).

It is indeed important for the Tory project to reduce wages and benefits (though probably not in order to challenge China in the production of cheap consumer goods).

Where did I suggest that anything in my post was desirable?

[peterms]

Where did I suggest that anything in my post was desirable?

You didn't. Did you think I suggested you did?

[Richard]

Your ideal of "buy British" is just ludicrous

As ludicrous as "British Jobs for British workers" or more ludricrous?

[Richard]

Nobody said that cleaning up after Labour's numerous cock ups was going to be easy or popular.

Again this is a Labour thing - I am sure that on Spanish, US, Greek, German, French etc etc web sites they are saying the same - frankly silly comment Mart

Is it really silly to believe that the party in government for the last 12 years is at least partly to blame for the dire straits that we now find ourselves in?

Silly? Ludicrous even.

Liebours legacy to this country is

They left every man, woman and child owing £22,400

They gave us one of the worst budget deficits in Europe - bigger than Italy, Greece, France, Germany, Portugal.

They left 2.47 million people out of work

And they sold off Britain's gold at a 20-year low in the market.

£3Bn on benefits overpayments and £10M on tax credits for people who had died.

Unless we act now to deal with this crisis, interest payments in five years' time could end up being higher than the amount we spend on schools, climate change and transport.

That's why the government was elected to do something about it. Liebours answers were rejected at the general election. The action that is coming are Labour's cuts

IFS quote (IFS The public finances :1997 - 2010, 19 April 2010 (p2)) "During Labours first four years in office, the public finances strengthened further, as the new government stuck to the tight public spending plans laid out by the Conservatives. The following seven years, however, were characterised by fiscal drift. By the eve of the financial crisis, this had left the UK with one of the largest structural budget deficits in the developed world"

So what Liebour supporters fail to grasp, as demonstrated by their global crisis defence, is that even though there were global financial pressures, this country was totally ill prepared to cope with them and the action that Liebour has taken during the crisis has made us even more ill prepared to come out of it in any good shape.

The action the coalition govt are having to make, forced to make if you will is as a direct result of the last Liebour govt. They cannot abdicate their responsibility no matter how much they want to

[drat01]

Stimulus is what this country needs Gideon Osborne will tomorrow attack that and try and deflect all blame to his fellow ConDem's (probably the old LibDem part) and the previous Gvmt.

The Tory party were keen advocates of the policies of the previous Gvmt and in fact suggested that they did not go far enough. How strange now that these ideas are conveniently forgotten, while the same people who championed them are lauded as some sort of saviours of the UK. Despite the fact that nearly, if not all of the current ConDem party/ gvmt have in the past claimed and demanded for higher public spending this is now again conveniently forgotten.

The lies that they spouted out pre and post election about protecting manufacturing will be seen in this and the next few weeks. The lies about the behaviour of their own party members will be seen time and time again. The lies about about their priorities will be exposed. The lies about their tax avoidance will continue to show the hypocrisy of a party that claims we are all in this together.

As it was said at the weekend, this was not a Gvmt that was voted in by the public, funny how we do not hear that old argument being spouted out now, maybe another rewrite of history?

[Risso]

that and try and deflect all blame to his fellow ConDem's ......and the previous Gvmt.

Who else is to blame? The party who has been in government for 12 years, or the party who hasn't? Labour has left the country in the worst mess it's ever been in.

[snowychap]

Richard, please don't think I'm having a go but if you are going to repeat (almost verbatim) a Conservative party document (Labour's Legacy) then it might be an idea to say it is such.