Ok. Sounds like you getting it. Let's ignore the whole thread and bring it back to the point you want to believe, and you want others to believe?
I guess it/they can be both at the same time, it's just I've been having difficulty getting my head around why a failed economic policy would be followed, carried out, whatever, when it causes harm. Isn't the idea to adopt economic policies that work, if it's not working then what other reason would there be other than a politically motivated one? I didn't say I understood their reasons for saying it's an economic policy, just that I understood why they say it is, IMO the reason people say it's an economic policy is because that's what they've been told for 5+ years, even though its been widely discredited. Well no actually, I want someone to show why it's an economic policy, to explain or give examples of how cutting spending generates income, why austerity is still being touted as the cure for somewhere like Greece when it seems to have done more harm than good.
Cutting spending generates less deficit. Therefore the increase in debt over time is lower than not cutting. Therefore the interest we pay on our nations debt acrues less over time, and in the long run we pay off our (credit cards / loans / mortgages / nations debt) sooner. The return on investment in public sector is not in the same league as focusing on the economy first, followed by spending what you can afford to on public sector. Think of it this way. If you truly value the expense of piblic sector/NHS etc over what actually affords these gifts to you - the private sector - take away the private sector completely. Now how the heck do you pay for the public sector? I would rather we get our .gov finances in order, and grow the economy to shoulder the public services, rather than have other nations see the UK as a poor investment with out of control debts we cant afford to pay back. You can (and will) believe whatever floats your boat in this world - these anti-austerity reports. We choose to perceive things the way that suits our minds. I seem to be able to see the wood through the trees and compare austerity to tightening the purse strings to pay off my mortgage before I go bankrupt, but you give me the impression you choose to perceive things differently to suit your minds needs. Maybe instead of trying to suggest that austerity is bad - in simplest terms explain to the thread why it is bad for the nation?
Yea i get the cutting part is meant to generate less deficit but everything I've read seems to indicate the opposite happens, by cutting spending you actually increase your deficit, and the reasons why this happens seem to, in my logical thinking, make sense. By cutting spending are you not sending out the signal that you're not willing to invest in the future, people start to hold onto their money in the hope of better times to come (lower tax, cheaper goods, better pay, etc, etc.) and businesses stop investing because the future is so uncertain with similar reason as those of normal people. Like I said everything I've read seems to indicate that when an austerity economic policy is imposed that governmental income actually goes down, it's one of the reasons why I'm left wondering, to me it seems counter intuitive but both statistics and RL economic people seem to backup that counter intuitive effect/outcome, iirc even the head of the IMF said they underestimated the damage that austerity has done to counties economy, as I'm not an economist I can't really argue or see why he, or the statistics, would/could be wrong. That's not to disagree with any of the points you've laid out forum_user, it just, i hope, lays out what the incongruent (is that the right word?) thoughts I'm having trying to balance the supposed need for austerity versus what statistic and economists seem to be saying.
I appreciate your post fella. Who am I to argue with all these scientic experts? But I still do In the short term (7 years) there has been a fraction of the cuts people expected so far. All this mega drama about the cuts is based on what people expected to come. It seems to me the last gov were very ... em ... conservative with their cutting (my perception). I'm not belittling the cuts that have been made so far. The nation is still up **** creek. But the worlds economies aren't daft enought to think we aren't on top of it and stop investing. I honestly believe that if we still had a Labour government, eother they would be doing exactly the same as the current 2 governments, or they would be screwing up the economy and our level of unmanageable debts based on this idea that it'll be alright in the end - keep spending - but worse, keep borrowing more. When it comes to reports from experts, it's a bit like thhe tobacco industry creating a report on pro-smoking, can we REALLY trust them. Back to my previous point, the cuts are more dramatised than how bad they could have been. Although we're not out the woods - far from it - the economy is still gently rocking upwards. Just after Xmas time we'll see another positive step up which will hold for 6 months, then a bit more gloom - rinse and repeat. Our debt is slowly being worked out. Other parties will maximise the BS meter as much as they can until the next election. A bit like Labour announcing that the landlord checks will create max-drama racism ... erm no. Can I see a valid passport/visa to stay, before letting this flat to you? This does not translate to racism, nice try.
That's because you're being rational. Now what did I tell you about that before? You are correct, but confirmation bias: those who are invested in it will perceive that it works because politically they believe it works. You are making the mistake of thinking that the private and public sector are unconnected entities. Not so --they are inextricably linked. Many public sector services and infrastructure are provided by or via the private sector. Hospitals are built by private contractors, as are roads, railroad tracks, public works etc. All that generates business, profits, wages, consumption. Indeed. Now if you take away the public sector/NHS, where are all those medical companies, construction companies, railroad maintenance companies etc. going to make their money? What roads and railroads will the private sector transport their goods over? Who will air-traffic-control all their airliners (yes, NATS is 49% public service)? Who will carry away their waste? Where will they get a healthy and educated productive workforce? Where will they get their regulated energy and utilities? Who will resolve their legal business disputes? Again, public sector services are not resources that just sit there costing money --they also generate a lot of business and profit for the private sector. I think that a mortgage is the wrong way of looking at it, because it is not covered against an asset (unless it is for a buy-to-let). Government borrowing can generate business and profit if it is done in the right way, as noted above. In fact notable disasters occur when attempts are made to devolve this investment to the private sector, e.g. PFI's --another example of unchecked capitalism exploiting the system. Ironically it is the private sector that tends to cause government to incur huge debts, not the public sector.
That's because you're not the one who has been feeling them (yet). But some people have. Again, you are thinking about this too simply. The Residential Landlords Association has found that 25% of landlords are now reluctant to rent to people with foreign passports, or even foreign-sounding names (or appearance). The reasons are not racism as such, but simple fear of liability: how do you know this tenant has a valid passport or residents permit? How do you know it's not forged (do you know what one is supposed to look like)? They simply do not relish a risk of £3000,-- fine --or possible jail sentence-- and thus avoid the risk altogether by turning away people who are not White British. Another concern is that landlords will be given the power to evict people who do not have a valid passport or residence permit, without needing a court order. This puts such people in an even more vulnerable position of exploitation.
Exactly, NOT racism. Back to the bit you said about private companies working on .gov contracts. Where does that money come from to pay the private contracts in the first place? Filtered down from the private sector. Again we come back to the debate about the chicken and the egg - but guess what, it is private sector money that pays for the whole nations party (effectively the chicken that lays the public sector egg) The public sector helps, for sure. I know, I know, I've said that in a very simplistic way gaping with minor holes that you and corky would love to pick over. Tax payers aren't daft, they know their money pays for services. Public sector workers shouldn't be complacent and realise that although they may well pay tax - their ehole wage was effectively paid for by the private sector. Follow the money trails.
Yea and that's the part i can't get my head around, everything says to me if your spending to much you need to cut your spending, yet everything I've read says the opposite, even though I understand the reasons they give it just seems counter intuitive, even though those reason seem to make logical sense. Talk about confusing, if we're spending to much we need to reduce spending, but wait economists and stats seem to show that logic is flawed. Yea TBH I wouldn't consider the UK has enacted an austerity economic strategy, it may have started out as that but it certainly isn't one now (imo) At least not in the economic sense as we are investing in infrastructure among other things, austerity UK seems more like an excuses for making politically sensitive budget decisions, that's not to cast judgment on those decisions, just that to me personally it seems we're paying lip service to the term "austerity" when compared to somewhere like Greece. Not as far up **** creek as America IIRC I read somewhere that the difference between the two major parties in terms of spending/cutting was something like 1% or some such small number, it's probably even less if we look back through the figures, even though we were told we need to cut spending we still managed to invest in what are arguably areas that encouraged investment, you only have to look at today's announcement that the government is spending £5 million on UK Video Games Prototype Fund. Yea I wondered if i was suffering from confirmation bias, it's one of the reasons i wanted to discuss austerity, am i just agreeing with the articles I've read, the stats they use, the quotes they use from economists to confirm what seems like a ludicrous, illogical idea, the illogical idea that you can't cut your way out of a recession.
Well, yes, racism, as in: prejudicial treatment based on skin colour or ethnicity. Your nationality/eligibility to rent is questioned and you are turned away just because you appear foreign --the landlord hasn't actually even looked at your passport yet. It is interesting that you are choosing the chicken/egg metaphor, because indeed it is impossible to say which was first. The private sector provides the taxes that fund the public sector --and indirectly the private sector, but the private sector could not function without the public sector works, services and subsidies it makes use of. The two are locked in a symbiotic relationship. I already gave you examples of how the private sector depends on public sector works and services to function. Here's some examples on how the private sector is subsidised by public sector money: BAE is subsidised by the government to the tune of £13.000,-- per employee, because naturally the government considers a healthy defence industry as important to the country's security. But if the defence industry is so healthy, why does it need £852 million a year in public service money? Another example is the estimated £11 billion a year that the British tax payer ponies up in in-work benefits, such as working tax credits, so that workers paid below a living wage and on zero hour contracts can afford a basic standard of living despite being in employment. Effectively the public purse subsidises the private sector being able to pay its workers the lowest wages possible so it can turn a bigger profit (something heavily criticised by Boris Johnson). You have to be careful of the narratives you weave around 'austerity'. The idea of "The UK took out huge loans to fund the public sector, now it has to pay them back" is an attractive one because it is simple, logical and we can relate it to our understanding of finances which is informed by our own personal affairs with loans, mortgages etc. But it is a narrative, not necessarily a reflection of reality (for starters, the government took out huge loans to bail out misbehaving private sector banks). The only people who really understand economics are economists. Ministers understand some of it, and the people they govern largely understand none of it. In order to get the minister on board, government economical advisors have to embed their explanations in some sort of narrative that he can understand. In order to get the population on board, the minister has to weave a narrative around economics that the unwashed masses can get their heads around. So we get simplified narratives, stories, about how this economy thing works. But they are gross oversimplifications, and it is important to keep that in mind. Government loans are not like personal loans or mortgages.
It is and has always been a political agenda. IIRC, we have known this since the 1930s when Michal Kalecki came out with this essay. - http://courses.umass.edu/econ797a-rpollin/Kalecki--Political Aspects of Full Employment.pdf The guy worked with Keynes, the great british economist from Cambridge University and was great in his own right. If you would like to know more about politics and economics, I suggest you read some of his works. The link above is a good place to start. Anyway, austerity from a simply economic point of view just doesn't work in a capitalist system. Its because it tries to reduce government spending on various things during a downturn when total spending is already low. That reduces GDP and the so called debt, which is a percent of GDP, increases as a result. To counter act this lack of spending, the private sector(corporation or people) has to make up for it and by and large the most common way to do that is by taking on more private debt. You can see this reflected in the current Tory government's policies which are basically pushing people to take on more debt,mostly household because the UK doesn't have much of an industry, whilst cutting spending on schools, benefits,etc. The political aspect comes in when you look at what is being cut which is generally never even enough on its own merit. You will notice that it is not subsidies to corporations or tax breaks to the very rich that are taken away. Rather the cuts are to more common services like public infrastructure, benefits to the poor,etc. You will also notice that the austerity agenda is always pushed into the public by analogising the country to a household or a business. But because the country is (arguably) the sole issuers of its currency, it is not like a household or business, which needs to somehow acquire it from the outside. Hence, conflating the workings of the government to the private sector, is THE SINGLE BIGGEST MISTAKE THAT THE ELECTORATE MAKES WHEN VOTING FOR PRO-AUSTERITY PARTIES.You can notice this when there's a question time episode on the economy. Hope this is a good enough explanation
I'm afraid you are mistaken. Government finances do not work like household or business finances unless politically forced by the government. hence phrases like "tightening the purse strings.." etc do not apply here. Government debt, held in domestic currency is always payable and can always be rolled over because it is the issuer of the currency.
I completely agree with you, but I have my doubts about what you say about Conservative ideology. I think there might be differences between the top rungs of the party and everyone else. The top rungs know its bull that people on a societal level should fend for themselves but push the ideology because its profits them and their fellows hugely!
What's wrong is that the ideology doesn't recognise the inherent social nature of human beings. No man is an island.
Damn them conservatives and their hidden agenda to destroy the British people by forcing businesses to close, thereby losing people their jobs, thereby making it impossible to pay debts and mortgages, thereby destroying each persons hopes and aspirations for a good life.
For, people having doubts about whether the private sector is 'better' than the NHS, think about it this way. God forbid you have an accident and need the intensive care unit. Would you have a 1000 quid a night to pay for it ( that's the rate for a good hospital where I live)? Would you want your family or friends running around getting your health insurance cleared while you are dying? I highly doubt it.
Yea, but in this context what does efficiency even mean for you? Do remember that the word is thrown around very irresponsibly in such matters.
Talk about plea to emotion fallacy. What actually happens is when go to a hospital they ask your personal details and your insurance provider and plan. That's it. Your insurance provider also provides a card with your insurance details on it which you keep in your wallet.
Indeed it was, thank you. I had already been reading about Keynes economic thinking and have to admit it makes logical sense to me. I could be wrong but it seems that's the current economic policy of the UK, we are after all still investing in infrastructure and other things that promote investment, we seem to have kept the austerity tag line but forgone the implementation, where as somewhere like Greece seems to have had no choice in the matter and is going full on austerity.
You have fast forwarded into some deep dark worrisome future that only exists in a few select individuals recesses of their minds. Lets slow down a bit and keep the chatter to the next logical step which is to rid the government of the responsibility and troublesome costs of departments and/or sectors of the NHS which would be better run by the private sector, and PAID FOR BY TAX MONEY. As it currently is, only th tax pays the privte businesses. Rather than OMG right, you wre all gonna have to be paying a gazillion amounts of cash to private firms OMG lets PROTEST really loudly before it even ****ing happens!!,1 /Drama
