Oddly I don't think we disagree on the broad requirements or fears/risk of investment. I will say Labour offered current Torys the challenge of independant analysis of manifesto spending plans and the Torys declined. The manifesto from the torys was as vague as I can remember any leading party offering!
Does austerity work
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Ask portugal, they recently met EU standards by reversing typical austerity measures!
I don't disagree in the broader sense I thought your earlier post was spot on - I'm generally an advocate of the more Keynesian type approach when it is free of deeper ideologies. I very much believe in things like the NHS and that everyone should have a right to 4 walls and a roof to call their own, etc. but I don't buy into social equality, etc. as much as those more on the left.
Comparing us to Portugal is only supporting those of us who point out we haven't had austerity.
Portugal public spending (set to 10y to see what happened post 2007).
https://tradingeconomics.com/portugal/government-spending
UK public spending
https://tradingeconomics.com/united-kingdom/government-spending
Portugal had genuine austerity followed by a loosening of the fiscal reins.
We had claims of austerity, but we never cut spending. All we did was reduced the rate of increase from planned. Like claiming you had a pay cut because you only got a 10% rise and were expecting 15%
Fully agree and as left/right wing as anyone believes themselves to be not all markets/sectors/needs are the same.
I don't want "innovative" banking, I don't want state cola. Socialist utopia may become important the more power each individual weilds at this point the current lot, scrabling to Trump and talkimg about trade deals look like an idealogically driven joke.
Criticism of Corbyn/Labour aren't all unfair, lets not pretend we haven't swung wildly in the opposite direction (mostly) for decades though.
I feel the approach of simply taking something that worked a bit in one circumstance and applying it in others is simplistic and flawed as an approach. It's a little like the passengers in a car saying we turned Left one time and avoided hitting a tree and so turning left is the way to avoid things. The economy of the UK and our contemporaries in Europe were all on a war footing. We'd suffered devastating losses in human lives, under-invested across the board and had far greater national debt than today (in % of GDP which is the right way to consider it). Liberalisation and obtaining equity for us to bounce back was the right thing to do. We had a baby boom (a natural response to the losses of war) and a great determination to recover. We capitalised on that. And of course contemporaries that doubled down on war time austerity strangled that response in their own economies.
But we haven't just come out of a World War. Our current economic crisis is the result of a over-extending our liability followed by a major US-led market collapse. Which the USA paid their way out of by taking on even more debt.
We had good fundamentals after WWII, including a lack of foreign competition. What we were starved of was capital to make good on opportunities. Today, our problems haven't resulted from war against existential threats, from massive die-offs from influenza or shortage of opportunity. They've resulted from gross mismanagement of the country by successive governments and academia. I'm not sure these problems will be solved by throwing money at them. I'd be willing to try if the money wasn't being borrowed at great expense, but it is. Our population was rising with a surge of new births after WWII. Today it is kept up only by immigration and our population is aging. There are endless differences I could hone in on that are fundamental differences between then and now.
Someone wanting to start a factory or a shop after WWII - a loan makes sense as an investment in our country. Borrowing money to keep paying unemployment benefit or subsidise employers at the tax payers' expense, I'm not so sure about.
Saying "borrowing lots of money worked then so it will work in our very different circumstances today" is dangerous. It's simplistic and faith in it as a principle is misguided. Eighty years ago, we saw a tree in the road and we turned left and avoided it. Today, we see smoke coming from the bonnet of the car and people start yelling "Turn Left, it worked before".
There are no universal solutions in Macro-economics.
Are you suggesting that entirely reversing what you see as real Austerity is coincidental to improved performance.
Broadly Keynes suggested investing your way out of reccession/hard times. Broadly the west did just that up until the laissez faire bregade became popular after the 70s oil crisis and later brought the banking crisis.
Read the whole post, seriously you are no keynes and casino anolgies are the next evolution in idiotconomics.
The debt was always going to be up. It fell under Major's Conservative government and then continued to fall a bit under Blair in the early years. Then around 2002 to 2007 Labour got a bit spend-happy and it started rising sharply. It would now be falling again but the economic crisis and the recession scuppered that. It's not really accurate to say that Austerity has failed so much as it is to say the floor we were standing on collapsed.
Yes. Corruption is a big problem. We could make a lot of progress in cleaning up all the back-hand dealing in this country. I feel it's very important but also not really specific to austerity, however. I worked in the NHS during the Blair years. There was PLENTY of corruption in the DoH back then, too.
Austerity done correctly allows for a proper reset of spending, to fully understand what you should start spending on, and to keep the unnecessary expenses gone. Similar to how insolvency can revatalise a failing company (for instance, see hmv).
Our problem is that the state took a little bit from everything, but didn't actually have a proper audit of whether it was doing the right things, or doing them in the right way.
Keynes didn't just advocate spending during downturns, but saving during the good times. You perhaps need to look at your history if you think running deficits was what was done during the post war period...
I'm shocked that some of these things haven't been looked into TBH I did work experience in the IS department at the main building for one district council - the top floor was done up like a penthouse - must have spent ridiculous money on furnishings and those at the top lorded it up there no one else got to go up at all I only had access due to the necessities of IT.
Well normal arguments are defunct post brexit anyway, so I don't see much point arguing this.
But, still. The fact is that most government spending is utter nonsense right now, if we had subsidised house building rather than the London market... We'd have more jobs and more fluid markets. One rather important example.
Hs2 isn't a terrible idea, but it'll ultimately be made useless by brexit, so whatever as I said.
Tax is a result of spending and market mobility, not the source... People need to understand this.
But, still. The fact is that most government spending is utter nonsense right now, if we had subsidised house building rather than the London market... We'd have more jobs and more fluid markets. One rather important example.
Hs2 isn't a terrible idea, but it'll ultimately be made useless by brexit, so whatever as I said.
Tax is a result of spending and market mobility, not the source... People need to understand this.
Soldato
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Yes, it makes obviously sense to me that we cannot keep ****ing money away. If only people started practicing it more at home. When interest rates rise it'll be someone elses fault, instead of home owners cutting back on spending in the past (when interest rates low) to prepare for the future.
USA is in a bigger debt hole than ever. China practically owns them
Fully star swearing - Thanks, Armageus
USA is in a bigger debt hole than ever. China practically owns them
Fully star swearing - Thanks, Armageus
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I did read the whole post. I read it in its one-sentence, three-line entirety. It contained a question which you intended to be rhetorical but which I answered because it was flawed. And some sarcastic barbs about my perhaps being "a new economic visionary."
I don't have to be Keynes to point out that somebody else isn't. You made a hugely reductive observation ('borrowed more after WWII and saw improvement') and then concluded that if we do the same today, we'll see the same result. Hence my analogy as a way of highlighting your absurd reductionism.
I don't claim to be Keynes. I claim that there are gross fundamental differences between post WWII UK and Europe and our circumstances today and that for you to make the imbecile statement with your bare face hanging out that we can apply the same action and expect the same result is naïve if I'm kind and moronic if I'm honest.
Wrong. America owns itself, and that's a much more insidious problem.
Next year is likely to be a recession in the US, the dollar has been making awkward movements aswell. It's not rosy right now and there's precious little space for movement with interest rates so low.
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Firstly I meant I read your whole post!
Secondly I have in no way suggested investment guarantees success!
Thirdly having reduced the discussion to roulette you talk of reductionism!
At this point your position (much as numerous advocates of "ideological" austerity) is something of a joke!
What definition are you using for "America"? The land mass? Obviously not. The American people? They demonstrably do not own the majority of American wealth in any legal sense. The government? That has financial assets but again does not own the majority of the country's wealth. The Federal Reserve? Controls currency.
"America owns itself" is a pithy turn of phrase, but please define in what sense you mean "America".