Guest 655- Registered: 13 Mar 2008
- Posts: 10,247
LOL - that is a very carefully selected time period Tom.
Mrs T did indeed believe in living within your means, but she agreed also that borrowing for the right reasons within your capacity to service the debt was a good thing. Indeed it is.
If you look at borrowing trends you will see that debt spiraled out of control during the post 1997 period often to pay for the wrong type of borrowing. This was a result of two things:
1/ The discouragement of investment. One of the first things Labour did in 1997 was to reduce significantly the amount of tax free savings people could make. Indeed they also reduced the tax free benefit though the end to the dividend tax credit.
This sent out the wrong signals to the public and with less savings, if any, to fall back on they had little or no cash available for emergency spending. As a result the public resorted to the wrong type of borrowing. An example, holidays on credit cards without repaying it before the next holiday.
2/ They kept interest rates down too long too low, enouraging further borrowing and discouraging further savings. It was at exactly the wrong part of the economic cycle for this. The long period of boom should have seen an increase in interest rates to cool down the debt boom,but Brown did not include that in the BoE interest rate brief so this problem was ignored. This, along with the government making the same mistakes as many of the public was a major reason for the mess we are in now.
It is absolutely absurd to blame Mrs T because of the stupid mistakes made 7 plus years after she left office. She never sanctioned BoE independence and certainly would not have approved of personal and government debt being allowed to spiral out of control as it did.
Worth adding that I was at the sharp end during that period seeing the direct effect on individual of the changes to savings made in 1997 and thereafter while regularly recommending people to clear down debt and save. I could often, it seemed, be talking to myself on that and more recently have found myself trying to help people pick up the pieces where they ignored that advice.
Guest 710- Registered: 28 Feb 2011
- Posts: 6,950
REINHART AND ROGOFF: 'Full Stop,' We Made A Microsoft Excel Blunder In Our Debt Study, And It Makes A Difference
"This is dramatic stuff. The 90% threshold has taken on a huge role in the public economic/political/pop-culture discourse. And they admit that an Excel error lead to a "notable" change in what you'd get for the average growth rate above this level."
Read more:
http://www.businessinsider.com/reinhart-and-rogoff-admit-excel-blunder-2013-4#ixzz2RH3RVKgJ" target="_blank" rel="nofollow noopener noreferrer">
http://www.businessinsider.com/reinhart-and-rogoff-admit-excel-blunder-2013-4#ixzz2RH3RVKgJ
" ...Put simply, the counter argument is that Reinhart and Rogoff have confused cause and effect: countries have high debt levels because they have slow growth rather than having slow growth because they are heavily indebted.
This seems logical. Britain's debt to GDP ratio has more than doubled in the past five years and is now close to the 90% level. But it was the collapse of the economy in 2008-09 followed by the most tepid of recoveries that blew a hole in the government finances. There is no indication that servicing this debt is prohibitively expensive: indeed, interest rates on government gilts are close to historic lows. As they are in other countries - such as the US and Germany - that are running debt to GDP ratios of a similar size. The message is a simple one: get economies moving and the debt will look after itself..."
http://www.guardian.co.uk/politics/2013/apr/21/george-osborne-imf-downgrade-inspection
"As the chancellor's "success" criteria - triple A ratings, IMF blessing and Ken Rogoff's figures ('Stonewall' Osborne falls victim to friendly fire, 22 April) - have fallen like dominoes, the ideological nature of his austerity strategy is confirmed. At the time of the 2008 crisis the problem with the UK economy was not public sector (government) debt, which at 52% GDP was less than most other developed countries including Germany. The problem was private sector debt at 328% of GDP, significantly more than all other countries except Japan. Yet the coalition has persisted in cutting the public sector instead of addressing the private financial sector. Even by David Cameron's criterion of "paying down the debt" his policies are not working. According to the UK Statistics Authority, since he entered office public sector net debt has risen from £811.3bn (55.3% of GDP) in June 2010 to £1.11trn (70.7% of GDP) at the end of 2012. Signs are that it will continue to do so.
David Murray
Wallington, Surrey"
http://www.guardian.co.uk/business/2013/apr/22/economic-howlers-of-our-time Ignorance is bliss, bliss is happiness, I am happy...to draw your attention to the possible connectivity in the foregoing.
Guest 714- Registered: 14 Apr 2011
- Posts: 2,594
According to the UK Statistics Authority, since he entered office public sector net debt has risen from £811.3bn (55.3% of GDP) in June 2010 to £1.11trn (70.7% of GDP) at the end of 2012. Signs are that it will continue to do so.
Eh? I thought we were in a period of austerity.
Guest 710- Registered: 28 Feb 2011
- Posts: 6,950
Plainly, as far as Dave and Gideon are concerned "austerity" is nothing but 'poor-bashing'.
The personal situations of the Conservative front bench may be affecting the thrust of policy:" the coalition has persisted in cutting the public sector instead of addressing the private financial sector."
I don't know what "ervative" stands for, but it is becoming all to stark what the "Con" stands for.
Ignorance is bliss, bliss is happiness, I am happy...to draw your attention to the possible connectivity in the foregoing.
Guest 714- Registered: 14 Apr 2011
- Posts: 2,594
Spending has risen by £200bn how on earth does that represent austerity?
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
represents stupidity if people are getting poorer and the cobbled together people are chucking dosh around.
Brian Dixon
- Location: Dover
- Registered: 23 Sep 2008
- Posts: 23,940
at who howard,certanly not at the middle or lower classes.
Guest 710- Registered: 28 Feb 2011
- Posts: 6,950
Rather than disinter a thread from the 'back' pages of the forum, I shall put this here...
"Letters (22 April) invoking the bogey of "union power" to justify Thatcherite scorched-earth policies, derive from highly selective social memories, largely created by tendentious histories and media depictions. Academic research has shown there was no monolithic union power that inflicted the "winter of discontent" on a victimised British population. The industrial actions were largely initiated by local and rank-and-file unionists, frustrated with pay restraint policies that had reduced real wages by 13% between 1975 and 1978. The TUC and other much-maligned union "barons" tried to restrain grassroots actions.
The (separate) tanker and delivery drivers' strikes may have been perceived as besieging a reader's community in Stoke, but impacts were actually patchy and temporary. West Midlands TGWU regional officials kept deliveries there going for much of the strike. The official stoppage lasted just three weeks and affected only around 20% of the haulage industry, with negligible national impacts on foodstuffs and daily necessities. The image of callous local authority gravediggers' strikes came from unofficial actions occurring only in Liverpool and Tameside for just two weeks. (Gravediggers in the free-enterprise heaven of 1990s Chicago went on strike for six weeks.)
As former Fleet Street editor Derek Jameson later recalled of press coverage of the "crisis", "we pulled every dirty trick in the book; we made it look like it was general, universal and eternal, when it was in reality scattered, here and there, and no great problem".
Dr Bryn Jones
University of Bath"
http://www.guardian.co.uk/politics/2013/apr/23/myths-reality-unions-winter-discontentIgnorance is bliss, bliss is happiness, I am happy...to draw your attention to the possible connectivity in the foregoing.
Guest 710- Registered: 28 Feb 2011
- Posts: 6,950
From the same page as that in #108...
...and in keeping with my incessant plea to register and to vote...for your non-vote will be taken as firm backing by a politician at their convenience...
"Apparently Boris Johnson thinks (Diary, 23 April) "the idea that a strike can be called by a majority of those who vote, rather than a majority of all those balloted, is farcical". OK then, lets not have laws and policy made by parliament when a majority of the electorate has not voted for the government. The union members Mr Johnson presumes are against action must take responsibility for choosing not to vote.
Martin Cooper
Bromley, Kent"
Ignorance is bliss, bliss is happiness, I am happy...to draw your attention to the possible connectivity in the foregoing.
howard mcsweeney1- Location: Dover
- Registered: 12 Mar 2008
- Posts: 62,352
agree with 108 the whole thing was blown out of proportion and brought down a government a year later.
Keith Sansum1
- Location: london
- Registered: 25 Aug 2010
- Posts: 23,942
yes to true
and the arguments from both sides go on
ALL POSTS ARE MY OWN PERSONAL VIEWS
