Does austerity work

stewski · 27 Aug 2017 at 18:28

Dolph said:
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 specifically and on numerous occasions have categorically pointed out that is not what is being said! It is possible to show return on investment by not making swathes of your populace unemployed!

Slam62 · 27 Aug 2017 at 18:32

No it doesn't work but it's too late now.

StriderX · 27 Aug 2017 at 18:32

h4rm0ny said:
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".

It's mostly Americans that own their own debt, foreign debt gilt is just investment for the most part.

Regardless America has a similar residential issue to Britain, too much credit and zeroish savings, so when people hit hard times, they're ******... Rather than momentarily embarrassed, it's only mitigation is familial savings (mummy and daddy bank, strange overtures to trickled down money), which is also rapidly approaching zero aswell.

The car rental market is a good current argument for how stupid the situation is.

stewski · 27 Aug 2017 at 18:34

Rroff said:
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.

To my knowledge it wasn't local government corruption that wasted 12+billion on the patient record for the NHS, in context thats roughly 1/3 to 1/4 of Labours spending plans. Hs 2 is likely to cost double Labous plans, do we really only need to think biscuit budgets in local government meetings when discussing probable corruption?

FurryLemon · 27 Aug 2017 at 18:37

The virtual currency system is failing.

Rroff · 27 Aug 2017 at 18:40

stewski said:
To my knowledge it wasn't local government corruption that wasted 12+billion on the patient record for the NHS, in context thats roughly 1/3 to 1/4 of Labours spending plans. Hs 2 is likely to cost double Labous plans, do we really only need to think biscuit budgets in local government meetings when discussing probable corruption?

Don't get me started on the NHS - a friend of mine moved from working where I did to a position in a similar kind of department at the NHS where they have 3x as many staff for the same job including a completely redundant manager's position on like 30-40K.

stewski · 27 Aug 2017 at 18:47

Rroff said:
Don't get me started on the NHS - a friend of mine moved from working where I did to a position in a similar kind of department at the NHS where they have 3x as many staff for the same job including a completely redundant manager's position on like 30-40K.

I agree worst of both world territory, public private finance is a corrupt joke!
Either it's social/commons infrastructure requirements like, government, transport infrastructure, education and health or it's fizzy drinks, tech and consumables!

A balance of both is fine but failed housing associations for example are a subsidised corrupt abomination of both worlds that services no one!

Nasher · 27 Aug 2017 at 18:54

All that has happened so far is the money has been moved around. We haven't actually made any savings.

The problem is we have quite a few incompetent people running the place, who blagged their way to the top of the civil service but don't actually know what they are doing.

V F · 27 Aug 2017 at 18:59

FurryLemon said:
The virtual currency system is failing.

I've heard this before.

stewski · 27 Aug 2017 at 19:00

Nasher said:
All that has happened so far is the money has been moved around. We haven't actually made any savings.

More importantly having had "innovative" deregulated banking, who is it my kid is paying back?
I want to understand/know that everyone who steered the system in a direction that will have definitely cost human lives, they are no longer at the wheel!

Even if you prefer the ideals of socialism, you probably wasn't planning on you and your family living in fight club mentality times to improve things!

Dolph · 27 Aug 2017 at 19:06

stewski said:
I specifically and on numerous occasions have categorically pointed out that is not what is being said! It is possible to show return on investment by not making swathes of your populace unemployed!

That depends on what the people are doing. I could solve the unemployment problem now by taking everyone, splitting them between hole digging and hole filling, and set them off digging holes and then filling them in, but it wouldn't be beneficial in any way. The work being done adds no value.

The problem we have, and what Portugal's austerity may have helped them with isn't the amount of money we spend, it's that we don't spend it very well.

D.P. · 27 Aug 2017 at 19:06

Absolutely not. Austerity has been proven not to work time and time again across the globe. Recently with the USA and Portugal vs Britain and Greece, but historical. For example the US dug itself out of the greatest recession in human history by investment.

https://www.theguardian.com/comment...rity-lie-deep-cuts-economy-portugal-socialist

Economists have very strong models showing exactly why it fails time and time again. Unfortunately right wing governments have used austerity for political and social control rather than sound economics. Plus the best way to get out of a recession is to tax the richest 0.001% an extra few percent to pay for new investments.

stewski · 27 Aug 2017 at 19:07

Dolph said:
That depends on what the people are doing. I could solve the unemployment problem now by taking everyone, splitting them between hole digging and hole filling, and set them off digging holes and then filling them in, but it wouldn't be beneficial in any way. The work being done adds no value.

The problem we have, and what Portugal's austerity may have helped them with isn't the amount of money we spend, it's that we don't spend it very well.

I could solve government spending by putting everyone on the dole and waiting for big society, absolutes are idiotic and nothing to do with anything I've said.

stewski · 27 Aug 2017 at 19:12

Dolph said:
That depends on what the people are doing. I could solve the unemployment problem now by taking everyone, splitting them between hole digging and hole filling, and set them off digging holes and then filling them in, but it wouldn't be beneficial in any way. The work being done adds no value.

The problem we have, and what Portugal's austerity may have helped them with isn't the amount of money we spend, it's that we don't spend it very well.

In all probability the government who reversed many austerity measures in Portugal have spent wisely as economically they have not only out performed the previous austerity direction, but much of their recent economic history. Let's not pretend inward investment is automatically doomed and if you were previously someone who spoke of house hold budgets analogies in the past, consider shutting up and taking the banking deregulation crowd with you on the walk of shame!

Dolph · 27 Aug 2017 at 19:14

D.P. said:
Absolutely not. Austerity has been proven not to work time and time again across the globe. Recently with the USA and Portugal vs Britain and Greece, but historical. For example the US dug itself out of the greatest recession in human history by investment.

https://www.theguardian.com/comment...rity-lie-deep-cuts-economy-portugal-socialist

Economists have very strong models showing exactly why it fails time and time again. Unfortunately right wing governments have used austerity for political and social control rather than sound economics. Plus the best way to get out of a recession is to tax the richest 0.001% an extra few percent to pay for new investments.

Portugal has already been mentioned, and doesn't show what you are claiming when compared to the UK.

Does austerity work

stewski · 27 Aug 2017 at 19:17

Dolph said:
Portugal has already been mentioned, and doesn't show what you are claiming when compared to the UK.

Does austerity work

What do you believe reversing austerity measures and then rapidly increasing the economy does show?

Should we invade somewhere against the opinion of all our allies again, or perhaps let the markets "creative destruction" take care of our banking market?

Dolph · 27 Aug 2017 at 19:18

stewski said:
In all probability the government who reversed many austerity measures in Portugal have spent wisely as economically they have not only out performed the previous austerity direction, but much of their recent economic history. Let's not pretend inward investment is automatically doomed and if you were previously someone who spoke of house hold budgets analogies in the past, consider shutting up and taking the banking deregulation crowd with you on the walk of shame!

Exactly, the lesson from Portugal could equally be that a sharp burst of genuine austerity, followed by better spending choices, is a better solution than our faux austerity where spending was still increasing significantly.

Household budgets are not a good analogy, corporate budgets would be a better one as there is a stronger association with spending money to make money.

Randomface74 · 27 Aug 2017 at 19:19

I think most people don't understand what austerity is.
They've been conditioned to think it's something that makes lives worse, end of story.
Rather than the truth, which is short term pain for long term gain.

StriderX · 27 Aug 2017 at 19:20

billysielu said:
I think most people don't understand what austerity is.
They've been conditioned to think it's something that makes lives worse, end of story.
Rather than the truth, which is short term pain for long term gain.

Like brexit?

The problem isn't the idea (atleast in some senses), it's the architects...

stewski · 27 Aug 2017 at 19:22

Dolph said:
Exactly, the lesson from Portugal could equally be that a sharp burst of genuine austerity, followed by better spending choices, is a better solution than our faux austerity where spending was still increasing significantly.

Household budgets are not a good analogy, corporate budgets would be a better one as there is a stronger association with spending money to make money.

Have you previously supported the household budget analogy, or banking deregulation?