spent a good half hour in bed last night re-reading this thread (i know, i know...)
Bar the odd deviation from the subject, there were some really interesting debate and contributions, so thanks all those who have contributed.
Would be interested to know the thoughts of those with more insight than me on how they see both short-term globally, the liklihood and impact of further problems with US debt. Not so much the raising of the ceiling, but more if at some point their main lenders stop buying their debt ? How wide and impacting will that be ?
And secondly closer to home, what future pain are we ensuring further down the line if the Help to Buy 2 scheme goes through the roof, and over the next few years wages stagnate and energy costs and others continue to rise ?
The current political "debate" in this country (and the US and Europe) is woefully inadequate for preparing for decisions which need to be made over the next 30-50 years. Because politicians don't want to lose votes and there is no central consensus on solutions - the most important question is what is the government for in the 21st Century? Or since the 2007-09 crash.
Before people stop supplying debt you get into Wonga territory which is obviously expensive so politicians seeking to stay in power for more than one term of office seek to keep the rates down with policies that meet market expectation NOT policies which actually fix anything!
Pensions and health are going to become unaffordable as central provisions unless choices are made like raising retirement ages to reduce the ratio of retired years to working years. The sale of the Post Office might just be the first of many government asset sales - I would ask why do governments need assets ... especially when they need to raise cash.
As Loco states there is time to avoid a meltdown but I don't believe there is an absolute limit... it is more that governments need to be able to service debts and roll them over and that requires growing economies or paying down debts. It is the countries and peoples who grasp the nettle first who will retain the highest credit ratings. The US, and all European governments have to reign in spending else other agencies will raise rates or simply stop lending - for an immediate example just look at Italy and Spain - large European economies which went over the top...then pulled back in. I believe that it is the need to fix the European economies that will pull them together politically as they seek to follow policies to come out of the crisis. Paradoxically it is the threat of crisis which is needed for people to think straight!
Personally I believe that once you sell a few assets the UK should then look to grow its way out of trouble looking to boost all of its world leading industries (Education, Financial Services, Creative Arts) as well as looking at creating jobs and training across the country which support the skills required for the future. And then there is of course the need for CASTrust to own CAFC in order to overcome our own debt crisis but I'm not sure you are buying that one are you AFKA?!
'Grow its way out of trouble'? By bolstering an education system that once was the envy of the world and now ranks well down the list? By putting even more eggs in the financial services industry basket than we already have - thus leaving us even more fucked when the inevitable next crash happens? By making films and music?
We're hosed, and we know it. The Chinese won. Start learning Mandarin.
spent a good half hour in bed last night re-reading this thread (i know, i know...)
Bar the odd deviation from the subject, there were some really interesting debate and contributions, so thanks all those who have contributed.
Would be interested to know the thoughts of those with more insight than me on how they see both short-term globally, the liklihood and impact of further problems with US debt. Not so much the raising of the ceiling, but more if at some point their main lenders stop buying their debt ? How wide and impacting will that be ?
And secondly closer to home, what future pain are we ensuring further down the line if the Help to Buy 2 scheme goes through the roof, and over the next few years wages stagnate and energy costs and others continue to rise ?
Personally I believe that once you sell a few assets the UK should then look to grow its way out of trouble looking to boost all of its world leading industries (Education, Financial Services, Creative Arts) as well as looking at creating jobs and training across the country which support the skills required for the future.
But that's where I struggle to understand. National debt is currently something like 1,400 billion, how much realistically could be raised from outstanding asset sales, if Royal Mail raised just 2 bn ? Using it to reduce debt won't touch the surface, so how do you 'sensibly' ease that money back into the economy to trigger sustainable growth and in consistently reduce the debt pile, without it ending up as a boost to private sector profits ?
If things go well for me I'll be dead in 25 years. With each passing year I seem to become less concerned by the train crash that is life. Enjoy simple pleasures more and worry less about things over which I have no control. I think the worry and fight has been gradually ground out of me. Know what. It's no bad thing.
spent a good half hour in bed last night re-reading this thread (i know, i know...)
Bar the odd deviation from the subject, there were some really interesting debate and contributions, so thanks all those who have contributed.
Would be interested to know the thoughts of those with more insight than me on how they see both short-term globally, the liklihood and impact of further problems with US debt. Not so much the raising of the ceiling, but more if at some point their main lenders stop buying their debt ? How wide and impacting will that be ?
And secondly closer to home, what future pain are we ensuring further down the line if the Help to Buy 2 scheme goes through the roof, and over the next few years wages stagnate and energy costs and others continue to rise ?
Personally I believe that once you sell a few assets the UK should then look to grow its way out of trouble looking to boost all of its world leading industries (Education, Financial Services, Creative Arts) as well as looking at creating jobs and training across the country which support the skills required for the future.
But that's where I struggle to understand. National debt is currently something like 1,400 billion, how much realistically could be raised from outstanding asset sales, if Royal Mail raised just 2 bn ? Using it to reduce debt won't touch the surface, so how do you 'sensibly' ease that money back into the economy to trigger sustainable growth and in consistently reduce the debt pile, without it ending up as a boost to private sector profits ?
There is no way to grow our economy without first reducing the debt or at least reducing it's growth to an extent that leads to cheaper debt because the lenders see less risk in the transaction. Every taxpayer in the country is servicing the national debt in taxes, those taxes are an overhead on our businesses. To reduce your costs you have to reduce your overheads, pay your workers less or lower taxes. Paradoxically lower taxes do not always equate to lower income from taxes in fact sometimes they increase, the trick is to pick the right one to lower, lower taxes stimulate the economy. If you invest in infrastructure, then the investment must return a increase in efficiency capable of repaying the extra debt incurred and that is difficult to do in a modern economy. I doubt HS2 will do it.
Other overheads that governments can affect are process and regulation related red tape, reducing the complexity of tax, planning, H/S regulations etc. Other countries have also tried free ports (free trade areas) where no taxes or duties are paid on trade, this can quickly establish areas of high growth but, I cant see the EU regulations allowing it.
One thing that puzzles me is even though governments (and people for that matter) understand that inflation is bad for an economy why is it that they think house price inflation is good? Our property bubble has distorted our economy enormously. Immigration and over lax credit have all fuelled this, I notice above you asked about this "help 2 buy" I cant see that in this economic climate that it will do any harm.
One more thing is that our financial services once strong and the envy of Europe are now nationalised. While our financial system was once preeminent, I cant see that lasting with extra regulation at every corner. We had the power to see this coming, in the grow of difference between M0 and M5 but no one was watching.
Here is a suggestion, what about making real cuts and real growth.
This is what we need to do
1.Cut EU Contributions - Today, the goverment has given the EU 3 billion pounds! 2. Cut Foreign Aid Contributions - Bare in mind most of that money goes to the goverments pockets and not to the people that need it. It also goes to Countries like India who are building a space programe. Not to mention India's economy is growing fast! 3. Take those on minimum wage out of tax altogether which will encourage people who stay on benefits to find a job which will mean benefit contributions will be cut and more people into work. 4. Remove the massive regulated burden off the 4.2 million Small/Medium sized businesses and they would become a bigger and would be able to employ more people which is a good way to produce growth.
1 Instead of attacking the EU, recognise that we need a European approach to this century starting with Transfer Pricing and routing internet sales to low tax countries (luxemburg vat 3% ...itunes) as per your point 4 engage with the EU to cut red tape to create competition, jobs and wealth 2 keep at the same level but have a look at where it goes - like the EU it is less than 1%! 3 100% agree AND raise minimum wage ...it is a fact that many on benefits are working on low wages for large organisations ...government is subsidising these jobs! people on less money spend more of any increase so they will help create more wealth 4 agree but dont know the detail 5 like minimum wage there is the same thing going on with housing benefit which is a government subsidy to landlords....invest in building low cost housing and shake this up.
Basically forget the UKIP nonsense and look at the biggest government budgets to get value: education, pensions health and benefits are perhaps 60%+ of spending - they all need shaping for the future...the main parties should be discussing philosophy and value - how do we address the challenges of 2030?
It is really a lot simpler than that. People need to just get used to spending less money. With such a small manufacturing base in this country it would not have too devastating an effect on us if people just set about keeping all their consumer goods for longer before replacing them.
Thus rather than having a new mobile phone every year maybe get one every two or three years. Buy a TV and keep it for 20 years. Keep your car for 10 years. Change your wardrobe when the clothes wear out or they don't fit any more. Don't 'restyle' your living room with new furniture every two years.
This would soon help household budgets to go from the red to the black, and that would enable us all to pay more tax to help reduce the burden that is lying in wait for our children and our grandchildren.
As for changing the system to make it better for those that don't want to work the easiest (and probably most successful) approach would be to cut benefits. Forget reducing tax for those that don't want to work, just stop giving them a house to live in and money to spend for free. If housing benefit and unemployment benefit were stopped completely I think there would suddenly be a lot of people willing to work for a lot less than the minimum wage. It would probably reduce the influx of migrants as well as there would be fewer jobs for them to come over here for.
Clearly these thoughts are rather right wing and I don't actually expect benefits to be stopped but I also don't see why those that don't want to work should be given more money to make them willing to take responsibility for themselves rather than expecting someone else to take care of them.
It is really a lot simpler than that. People need to just get used to spending less money. With such a small manufacturing base in this country it would not have too devastating an effect on us if people just set about keeping all their consumer goods for longer before replacing them.
Thus rather than having a new mobile phone every year maybe get one every two or three years. Buy a TV and keep it for 20 years. Keep your car for 10 years. Change your wardrobe when the clothes wear out or they don't fit any more. Don't 'restyle' your living room with new furniture every two years.
This would soon help household budgets to go from the red to the black, and that would enable us all to pay more tax to help reduce the burden that is lying in wait for our children and our grandchildren.
As for changing the system to make it better for those that don't want to work the easiest (and probably most successful) approach would be to cut benefits. Forget reducing tax for those that don't want to work, just stop giving them a house to live in and money to spend for free. If housing benefit and unemployment benefit were stopped completely I think there would suddenly be a lot of people willing to work for a lot less than the minimum wage.
This is a huge sign. America does not own the world any more........thank f**k........bring on the Chinese/Ameriacn challnege for the top, and let's follow the Chinese. The Ynaks have led us to almost disaster.
Also i dont want to go off topic but just read Rodders comments and notice that he hasnt logged on/commented since mid June?? Hope he's okay. Anyway i dont want to go off topic.
He is fine still attending games etc.
Is now living as a lady in anticipation of the medical procedure, so if he comes back I'd expect a username change.
It is really a lot simpler than that. People need to just get used to spending less money. With such a small manufacturing base in this country it would not have too devastating an effect on us if people just set about keeping all their consumer goods for longer before replacing them.
Thus rather than having a new mobile phone every year maybe get one every two or three years. Buy a TV and keep it for 20 years. Keep your car for 10 years. Change your wardrobe when the clothes wear out or they don't fit any more. Don't 'restyle' your living room with new furniture every two years.
This would soon help household budgets to go from the red to the black, and that would enable us all to pay more tax to help reduce the burden that is lying in wait for our children and our grandchildren.
As for changing the system to make it better for those that don't want to work the easiest (and probably most successful) approach would be to cut benefits. Forget reducing tax for those that don't want to work, just stop giving them a house to live in and money to spend for free. If housing benefit and unemployment benefit were stopped completely I think there would suddenly be a lot of people willing to work for a lot less than the minimum wage. It would probably reduce the influx of migrants as well as there would be fewer jobs for them to come over here for.
Clearly these thoughts are rather right wing and I don't actually expect benefits to be stopped but I also don't see why those that don't want to work should be given more money to make them willing to take responsibility for themselves rather than expecting someone else to take care of them.
If only it was this simple - you stop buying cars and furniture etc. You'll find car dealerships and furniture stores go out of business, leading to more unemployment, making the recession worse.
This is a huge sign. America does not own the world any more........thank f**k........bring on the Chinese/Ameriacn challnege for the top, and let's follow the Chinese. The Ynaks have led us to almost disaster.
I predict India in about 20 years time. Their economy is growing fast and they opened it's first Pizza Hut in India.
Posting without reading. Is there any mileage in blaming Darwin and or Dawkins? If so can someone explain because I never quite got the drift on the other thread :0)
So now the US have kicked the can down the road again, the claimed damage done to the US economy during this period of uncertainty will repeat itself in January and negotiations or press release and counter release will resume, causing even more damage.
Those opposing the continued seasonal increases to the debt have my sympathy, I wish we had a second house to call our government to account as the US does, because our problems are much worse. There must be a plan to reduce the increase of indebtedness before an agreement is reached, if not this time then next or at least some time soon. It's just irresponsible to keep adding debt to the economy, some time it will have to be paid back.
I know modern western economies just service and roll over debt, but this is such a short sighted solution. The cost of servicing debt comes from taxes, those taxes are paid by businesses and workers, they in turn get that money from customers who buy their goods or services, so those customers are paying for our debt with an increase in the cost of our goods. That is OK when the value of what we can provide is worth the premium but, increasingly the so called developing world can provide the self same services or goods and without the debt surcharge and when we lose custom we restrict our ability to reduce our debt.
Governments should always as seriously_red rightly points out, review what their purpose is and measure every decision they make against that purpose. However it is not in the nature of such organisations to reduce executive power, it is more usual that they increase it. A second house should not only challenge any decision making process but also any increase of power or influence. The nearest we get to that are the parliamentary committee's that seek to hold government departments to account, they cannot stop the creation of new departments or new areas of government, outside bodies are required to do that.
Every political party wants to be the party that says yes to everything, it's so easy. Saying no to an increase in health care spend will always have negative connotations because an emotive argument can be made to counter it, with sick people paraded before the media to pour scorn on anyone trying to balance the public accounts. The unfortunate thing is that when politicians do the right thing it looks bad in the press, the electorate therefore have a responsibility to understand what is going on. Too many do not understand or care about the consequences of the path we are taking, we all have a responsibility to future generations not to leave them burdened with debt.
Margaret Thatcher said "Perhaps it takes a housewife to see that Britain's national housekeeping is appalling. Britain is producing every week the same as she was in February last year. Yet she is spending half as much again." Angela Markel has a similar style with her "Swabian Hausfrau" analogies. Perhaps it is as much the job of politician to clearly explain the current situation in a way that will be understood as it is the duty of the electorate to understand it. Making the economic imperatives politically possible is something that is necessary here and across the Atlantic.
At the moment though those that oppose further debt increases are accused of being far right extremists and Tea Party crazies. The satirists dream, Sarah Palin seems to be representative of all who are opposed to Obama's spending plans. Her lack of background work and her general lack of intelligence seem to rub off on everybody else, which is a shame because I think those that are making a stand are doing so for the good of their country. Unfortunately with an electorate increasingly reliant on government, it's hard to see how this will be anything other than a temporary halt (and maybe not even that) to fiscal expansion it cant end well.
It is really a lot simpler than that. People need to just get used to spending less money. With such a small manufacturing base in this country it would not have too devastating an effect on us if people just set about keeping all their consumer goods for longer before replacing them.
Thus rather than having a new mobile phone every year maybe get one every two or three years. Buy a TV and keep it for 20 years. Keep your car for 10 years. Change your wardrobe when the clothes wear out or they don't fit any more. Don't 'restyle' your living room with new furniture every two years.
This would soon help household budgets to go from the red to the black, and that would enable us all to pay more tax to help reduce the burden that is lying in wait for our children and our grandchildren.
As for changing the system to make it better for those that don't want to work the easiest (and probably most successful) approach would be to cut benefits. Forget reducing tax for those that don't want to work, just stop giving them a house to live in and money to spend for free. If housing benefit and unemployment benefit were stopped completely I think there would suddenly be a lot of people willing to work for a lot less than the minimum wage. It would probably reduce the influx of migrants as well as there would be fewer jobs for them to come over here for.
Clearly these thoughts are rather right wing and I don't actually expect benefits to be stopped but I also don't see why those that don't want to work should be given more money to make them willing to take responsibility for themselves rather than expecting someone else to take care of them.
If only it was this simple - you stop buying cars and furniture etc. You'll find car dealerships and furniture stores go out of business, leading to more unemployment, making the recession worse.
Agreed, but as these goods are being bought with leveraged money it is not sustainable. It just carries on until the lines of credit run out.
What makes the biggest difference is that much of the money is going to provide jobs in other countries as we have little in the way of a manufacturing in the UK. Thus it makes more sense for those selling foreign made foods to UK households with borrowed money to do something else. We have more shopping centres in this country than we can possibly need. The number of people that spend their weekends walking around shops looking for things to buy with the money they haven't earned yet is staggering.
It has to stop. We have to stop consuming things we can't afford and it matters not if those selling the crap we don't need don't want to do something else for a living. In the end the debt needs to be repaid, and the sooner we stop spending like crazy, the less pain we will have to go through the get the debts under control.
So now the US have kicked the can down the road again, the claimed damage done to the US economy during this period of uncertainty will repeat itself in January and negotiations or press release and counter release will resume, causing even more damage.
Those opposing the continued seasonal increases to the debt have my sympathy, I wish we had a second house to call our government to account as the US does, because our problems are much worse. There must be a plan to reduce the increase of indebtedness before an agreement is reached, if not this time then next or at least some time soon. It's just irresponsible to keep adding debt to the economy, some time it will have to be paid back.
I know modern western economies just service and roll over debt, but this is such a short sighted solution. The cost of servicing debt comes from taxes, those taxes are paid by businesses and workers, they in turn get that money from customers who buy their goods or services, so those customers are paying for our debt with an increase in the cost of our goods. That is OK when the value of what we can provide is worth the premium but, increasingly the so called developing world can provide the self same services or goods and without the debt surcharge and when we lose custom we restrict our ability to reduce our debt.
Governments should always as seriously_red rightly points out, review what their purpose is and measure every decision they make against that purpose. However it is not in the nature of such organisations to reduce executive power, it is more usual that they increase it. A second house should not only challenge any decision making process but also any increase of power or influence. The nearest we get to that are the parliamentary committee's that seek to hold government departments to account, they cannot stop the creation of new departments or new areas of government, outside bodies are required to do that.
Every political party wants to be the party that says yes to everything, it's so easy. Saying no to an increase in health care spend will always have negative connotations because an emotive argument can be made to counter it, with sick people paraded before the media to pour scorn on anyone trying to balance the public accounts. The unfortunate thing is that when politicians do the right thing it looks bad in the press, the electorate therefore have a responsibility to understand what is going on. Too many do not understand or care about the consequences of the path we are taking, we all have a responsibility to future generations not to leave them burdened with debt.
Margaret Thatcher said "Perhaps it takes a housewife to see that Britain's national housekeeping is appalling. Britain is producing every week the same as she was in February last year. Yet she is spending half as much again." Angela Markel has a similar style with her "Swabian Hausfrau" analogies. Perhaps it is as much the job of politician to clearly explain the current situation in a way that will be understood as it is the duty of the electorate to understand it. Making the economic imperatives politically possible is something that is necessary here and across the Atlantic.
At the moment though those that oppose further debt increases are accused of being far right extremists and Tea Party crazies. The satirists dream, Sarah Palin seems to be representative of all who are opposed to Obama's spending plans. Her lack of background work and her general lack of intelligence seem to rub off on everybody else, which is a shame because I think those that are making a stand are doing so for the good of their country. Unfortunately with an electorate increasingly reliant on government, it's hard to see how this will be anything other than a temporary halt (and maybe not even that) to fiscal expansion it cant end well.
Top post Loco. The debts cannot keep getting rolled over forever, one day the country will have to go into the political/economic version of administration if it does not reduce the debts soon.
You can roll over debt forever as long as one of the following apply: national growth and inflation exceeds interest + budget deficit and/or your creditors offer generous terms / are afraid to pull the plug... the thing about the US is that China holds a lot of their sovereign debt meaning it's going to get fun in about 30 years time!!!
Those opposing the continued seasonal increases to the debt have my sympathy, I wish we had a second house to call our government to account as the US does, because our problems are much worse. There must be a plan to reduce the increase of indebtedness before an agreement is reached, if not this time then next or at least some time soon. It's just irresponsible to keep adding debt to the economy, some time it will have to be paid back.
In what circumstances will we have to pay it back? The idea that there will be a time when we have to pay it all back in one go at some point in the future is a fallacy. It is also ridiculous to compare the national budget with a household budget. A household cannot borrow money indefinitely. It will only be able to borrow money over a single typical working life of 25 to 30 years.
If the UK only invested what it could afford from the annual tax take in capital infrastructure projects, education and the health service over the last 60 or 70 years the country would be in a sorry state today. Using the anti-government/anti-tax logic of Thatcherites and Tea Party Republicans the previous generations have left us with only massive debts. But the truth is they have also left us with an infrastructure and an educated workforce that is worth, in today’s money, many billions more than those debts. Similarly, the money the current government borrows to invest in new transport infrastructure, telecoms, increased airport capacity, increased security etc. will be worth significantly more to future generations than the debt that we pass down to them.
I am not saying that a rising deficit is not a problem. But it is naive to view it as if you can deal with it by applying principles a typical household would use to balance its budget.
Also, our deficit is not out of control or at an all time high as the figures here (falseeconomy.org.uk/cure/how-big-is-the-problem) show. I know that this website has an agenda but I have checked some of the graphs with other sources and they seem correct.
Comments
Before people stop supplying debt you get into Wonga territory which is obviously expensive so politicians seeking to stay in power for more than one term of office seek to keep the rates down with policies that meet market expectation NOT policies which actually fix anything!
Pensions and health are going to become unaffordable as central provisions unless choices are made like raising retirement ages to reduce the ratio of retired years to working years. The sale of the Post Office might just be the first of many government asset sales - I would ask why do governments need assets ... especially when they need to raise cash.
As Loco states there is time to avoid a meltdown but I don't believe there is an absolute limit... it is more that governments need to be able to service debts and roll them over and that requires growing economies or paying down debts. It is the countries and peoples who grasp the nettle first who will retain the highest credit ratings. The US, and all European governments have to reign in spending else other agencies will raise rates or simply stop lending - for an immediate example just look at Italy and Spain - large European economies which went over the top...then pulled back in. I believe that it is the need to fix the European economies that will pull them together politically as they seek to follow policies to come out of the crisis. Paradoxically it is the threat of crisis which is needed for people to think straight!
Personally I believe that once you sell a few assets the UK should then look to grow its way out of trouble looking to boost all of its world leading industries (Education, Financial Services, Creative Arts) as well as looking at creating jobs and training across the country which support the skills required for the future. And then there is of course the need for CASTrust to own CAFC in order to overcome our own debt crisis but I'm not sure you are buying that one are you AFKA?!
By bolstering an education system that once was the envy of the world and now ranks well down the list?
By putting even more eggs in the financial services industry basket than we already have - thus leaving us even more fucked when the inevitable next crash happens?
By making films and music?
We're hosed, and we know it. The Chinese won. Start learning Mandarin.
The answer is - meltdown
It'll all end in tears...
Other overheads that governments can affect are process and regulation related red tape, reducing the complexity of tax, planning, H/S regulations etc. Other countries have also tried free ports (free trade areas) where no taxes or duties are paid on trade, this can quickly establish areas of high growth but, I cant see the EU regulations allowing it.
One thing that puzzles me is even though governments (and people for that matter) understand that inflation is bad for an economy why is it that they think house price inflation is good? Our property bubble has distorted our economy enormously. Immigration and over lax credit have all fuelled this, I notice above you asked about this "help 2 buy" I cant see that in this economic climate that it will do any harm.
One more thing is that our financial services once strong and the envy of Europe are now nationalised. While our financial system was once preeminent, I cant see that lasting with extra regulation at every corner. We had the power to see this coming, in the grow of difference between M0 and M5 but no one was watching.
This is what we need to do
1.Cut EU Contributions - Today, the goverment has given the EU 3 billion pounds!
2. Cut Foreign Aid Contributions - Bare in mind most of that money goes to the goverments pockets and not to the people that need it. It also goes to Countries like India who are building a space programe. Not to mention India's economy is growing fast!
3. Take those on minimum wage out of tax altogether which will encourage people who stay on benefits to find a job which will mean benefit contributions will be cut and more people into work.
4. Remove the massive regulated burden off the 4.2 million Small/Medium sized businesses and they would become a bigger and would be able to employ more people which is a good way to produce growth.
2 keep at the same level but have a look at where it goes - like the EU it is less than 1%!
3 100% agree AND raise minimum wage ...it is a fact that many on benefits are working on low wages for large organisations ...government is subsidising these jobs! people on less money spend more of any increase so they will help create more wealth
4 agree but dont know the detail
5 like minimum wage there is the same thing going on with housing benefit which is a government subsidy to landlords....invest in building low cost housing and shake this up.
Basically forget the UKIP nonsense and look at the biggest government budgets to get value: education, pensions health and benefits are perhaps 60%+ of spending - they all need shaping for the future...the main parties should be discussing philosophy and value - how do we address the challenges of 2030?
Thus rather than having a new mobile phone every year maybe get one every two or three years. Buy a TV and keep it for 20 years. Keep your car for 10 years. Change your wardrobe when the clothes wear out or they don't fit any more. Don't 'restyle' your living room with new furniture every two years.
This would soon help household budgets to go from the red to the black, and that would enable us all to pay more tax to help reduce the burden that is lying in wait for our children and our grandchildren.
As for changing the system to make it better for those that don't want to work the easiest (and probably most successful) approach would be to cut benefits. Forget reducing tax for those that don't want to work, just stop giving them a house to live in and money to spend for free. If housing benefit and unemployment benefit were stopped completely I think there would suddenly be a lot of people willing to work for a lot less than the minimum wage. It would probably reduce the influx of migrants as well as there would be fewer jobs for them to come over here for.
Clearly these thoughts are rather right wing and I don't actually expect benefits to be stopped but I also don't see why those that don't want to work should be given more money to make them willing to take responsibility for themselves rather than expecting someone else to take care of them.
And 1% of eu budget in aid is 1% of a hell of a lot!
I think AFKA was asking about where next and not lets blame the EU and poor countries!
Is now living as a lady in anticipation of the medical procedure, so if he comes back I'd expect a username change.
Those opposing the continued seasonal increases to the debt have my sympathy, I wish we had a second house to call our government to account as the US does, because our problems are much worse. There must be a plan to reduce the increase of indebtedness before an agreement is reached, if not this time then next or at least some time soon. It's just irresponsible to keep adding debt to the economy, some time it will have to be paid back.
I know modern western economies just service and roll over debt, but this is such a short sighted solution. The cost of servicing debt comes from taxes, those taxes are paid by businesses and workers, they in turn get that money from customers who buy their goods or services, so those customers are paying for our debt with an increase in the cost of our goods. That is OK when the value of what we can provide is worth the premium but, increasingly the so called developing world can provide the self same services or goods and without the debt surcharge and when we lose custom we restrict our ability to reduce our debt.
Governments should always as seriously_red rightly points out, review what their purpose is and measure every decision they make against that purpose. However it is not in the nature of such organisations to reduce executive power, it is more usual that they increase it. A second house should not only challenge any decision making process but also any increase of power or influence. The nearest we get to that are the parliamentary committee's that seek to hold government departments to account, they cannot stop the creation of new departments or new areas of government, outside bodies are required to do that.
Every political party wants to be the party that says yes to everything, it's so easy. Saying no to an increase in health care spend will always have negative connotations because an emotive argument can be made to counter it, with sick people paraded before the media to pour scorn on anyone trying to balance the public accounts. The unfortunate thing is that when politicians do the right thing it looks bad in the press, the electorate therefore have a responsibility to understand what is going on. Too many do not understand or care about the consequences of the path we are taking, we all have a responsibility to future generations not to leave them burdened with debt.
Margaret Thatcher said "Perhaps it takes a housewife to see that Britain's national housekeeping is appalling. Britain is producing every week the same as she was in February last year. Yet she is spending half as much again." Angela Markel has a similar style with her "Swabian Hausfrau" analogies. Perhaps it is as much the job of politician to clearly explain the current situation in a way that will be understood as it is the duty of the electorate to understand it. Making the economic imperatives politically possible is something that is necessary here and across the Atlantic.
At the moment though those that oppose further debt increases are accused of being far right extremists and Tea Party crazies. The satirists dream, Sarah Palin seems to be representative of all who are opposed to Obama's spending plans. Her lack of background work and her general lack of intelligence seem to rub off on everybody else, which is a shame because I think those that are making a stand are doing so for the good of their country. Unfortunately with an electorate increasingly reliant on government, it's hard to see how this will be anything other than a temporary halt (and maybe not even that) to fiscal expansion it cant end well.
What makes the biggest difference is that much of the money is going to provide jobs in other countries as we have little in the way of a manufacturing in the UK. Thus it makes more sense for those selling foreign made foods to UK households with borrowed money to do something else. We have more shopping centres in this country than we can possibly need. The number of people that spend their weekends walking around shops looking for things to buy with the money they haven't earned yet is staggering.
It has to stop. We have to stop consuming things we can't afford and it matters not if those selling the crap we don't need don't want to do something else for a living. In the end the debt needs to be repaid, and the sooner we stop spending like crazy, the less pain we will have to go through the get the debts under control.
national growth and inflation exceeds interest + budget deficit
and/or
your creditors offer generous terms / are afraid to pull the plug...
the thing about the US is that China holds a lot of their sovereign debt meaning it's going to get fun in about 30 years time!!!
If the UK only invested what it could afford from the annual tax take in capital infrastructure projects, education and the health service over the last 60 or 70 years the country would be in a sorry state today. Using the anti-government/anti-tax logic of Thatcherites and Tea Party Republicans the previous generations have left us with only massive debts. But the truth is they have also left us with an infrastructure and an educated workforce that is worth, in today’s money, many billions more than those debts. Similarly, the money the current government borrows to invest in new transport infrastructure, telecoms, increased airport capacity, increased security etc. will be worth significantly more to future generations than the debt that we pass down to them.
I am not saying that a rising deficit is not a problem. But it is naive to view it as if you can deal with it by applying principles a typical household would use to balance its budget.
Also, our deficit is not out of control or at an all time high as the figures here (falseeconomy.org.uk/cure/how-big-is-the-problem) show. I know that this website has an agenda but I have checked some of the graphs with other sources and they seem correct.