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Debates Forum

Debates Forum

  1. Standard member finnegan
    GENS UNA SUMUS
    06 May '15 21:22
    At last a decent account of what is wrong with austerity policies and why Cameron is a big fat liar and why it is a drag having our mass media owned by tax dodgers, crooks and Australians.

    http://benjaminstudebaker.com/2015/05/02/britain-for-the-love-of-god-please-stop-david-cameron/

    The International Monetary Fund (IMF) subsequently came out with a paper stating that the multiplier (the effect of government spending on economic growth) had been massively underestimated. Then it got worse–the IMF revealed that because the multiplier is so large, austerity shrinks the economy enough to cancel out debt relief. Let me be clear–austerity reduces growth so much that it undercuts government revenue and prevents governments from shrinking their deficits.
    According to Oxfam, the government’s austerity policies have devastated Britain’s middle and working classes in a variety of ways:

    As a result of austerity, an addition 800,000 British children will live in poverty over the next decade.
    Over the same period, 1.5 million working age adults will fall into poverty.
    By 2018, 900,000 public sector workers will have lost their jobs.
    The bottom 10% of British earners will have seen their incomes fall 38% over this government’s five year term.
  2. Standard member finnegan
    GENS UNA SUMUS
    06 May '15 21:29
    http://benjaminstudebaker.com/2015/05/06/13-terrible-tory-counterarguments/

    This blog deals with the predictable counter arguments and shows that the original blog was well argued and robust.
  3. Standard member finnegan
    GENS UNA SUMUS
    06 May '15 21:35
    Austerity has never worked so why do we return again to this failed quack remedy?

    http://www.theguardian.com/commentisfree/2012/jun/04/austerity-policy-eurozone-crisis

    So, if the whole history of capitalism, and not just the experiences of the last few years, shows that the supposed remedies for today's economic crisis are not going to work, what are our political and economic leaders doing? Perhaps they are insane – if we follow Albert Einstein's definition of insanity as "doing the same thing over and over again and expecting different results". But the more likely explanation is that, by pushing these policies against all evidence, our leaders are really telling us that they want to preserve – or even intensify, in areas like welfare policy – the economic system that has served them so well in the past three decades.

    For the rest of us, the time has come to choose whether we go along with that agenda or make these leaders change course.
  4. Standard member finnegan
    GENS UNA SUMUS
    06 May '15 21:38
    Why do the British keep falling for the austerity delusion?

    http://www.theguardian.com/business/ng-interactive/2015/apr/29/the-austerity-delusion

    Noone else believes it any more. (Maybe American Republicans and Tea Party I suppose)
  5. 06 May '15 22:24
    Originally posted by finnegan
    http://benjaminstudebaker.com/2015/05/06/13-terrible-tory-counterarguments/

    This blog deals with the predictable counter arguments and shows that the original blog was well argued and robust.
    What is the alternative to austerity? Spending recklessly more than revenues?
  6. Standard member finnegan
    GENS UNA SUMUS
    06 May '15 22:59 / 1 edit
    Originally posted by normbenign
    What is the alternative to austerity? Spending recklessly more than revenues?
    Yes as I said, there are probably American Republicans still seduced by the delusion of Austerity. The answer to your pseudo comment is in the material linked to my post. I made no effort to reproduce the content. I often do that because I know people like you refuse to read uncomfortable evidence.

    Austerity shrinks the economy. If you wish to balance your books, then it is no solution to undercut the revenue side of the equation. Even private households borrow - for things like a mortgage. Most business borrows to invest (when there is the confidence to do so). Failure to borrow is not prudent - it is simply opting out of the economy.

    It is part of the business of government to take steps to sustain sufficient economic activity in the economy, from which its own revenues also derive. Demand is not going to come from over indebted private individuals and while business is known to be replete with cash (sitting on cash mountains in fact) it does not wish to invest productively because of the low demand in the economy.

    If you do not agree, then you need to review and comment on the evidence supplied in the first link.
  7. Standard member finnegan
    GENS UNA SUMUS
    06 May '15 23:07 / 1 edit
    Originally posted by normbenign
    What is the alternative to austerity? Spending recklessly more than revenues?
    Sigh. You just will not read the links so here is the answer you would have found if you looked instead of instantly rattling off your cliche challenge:
    Britain’s debt burden fell dramatically between 1950 and 1975. How is this possible? Three factors:
    Economic growth–by investing public money in programs that helped grow the economy, Britain was able to grow faster than the debt. While net borrowing only occasionally exceeded 4%, annual UK economic growth frequently exceeded 4% during these decades, neutralizing the borrowing:
    Inflation–by running low to moderate inflation throughout these decades (with the exception of the 70’s, during the oil crisis, in which things got out of hand), Britain was also able to reduce the value of the debt in real terms:
    Devaluation–because Britain controlled its own currency, it was able to occasionally significantly reduce the value of the pound, shrinking the size of the debt burden rapidly in short periods of time. This also made UK exports more competitive and drove up growth. Harold Wilson famously did this in 1967 (if you look at the debt to GDP graph I posted, the rate of improvement accelerates after 1967). It most recently happened in the early 1990’s, when Britain exited ERM. This brought about a rapid fall in the debt burden:
    By creating strong economic growth, mild inflation, and occasionally devaluing, governments can reduce even very large debt burdens without resorting to austerity.
    And let’s also remember that as I said before, austerity makes things worse by decreasing the rate of economic growth, making it harder for the government to shrink the debt relative to the size of the economy. The IMF’s research is very clear on this. Labour’s spending was not out of the ordinary and could certainly have been handled without austerity. If the UK could overcome the debt burden imposed by World War II without austerity, it defies reason that this blip would be too much to handle.
  8. 07 May '15 01:09 / 1 edit
    Just a related question, hopefully not of subject.

    It seems to me, ( an unlearned individual ) that when governments borrow, to stimulate the economy, this borrowed money just ends up, flowing to the top. i.e. the lower income will end up spending the highest % of what they get, the middle will save some and the highest will save all, probably. When each group spends what they get the cash goes up the food chain, right??.
    My question is this. Why does it always seem that the ones that get the MOST out of any stimulus (the rich), ( though the benefits of a well targeted stimulus package is obviously good at the bottom) are the least targeted when things are perceived to go belly up and we ALL get scared and want it paid back. Somethings crook it Tobruk.( Aussie saying).
    And another, I fear extremely naive , question. if, as it seems, so many countries owe so much money to other countries, is that not like I owe you 1,000,000 and you owe me 1,000,000 so what the. I am a bit embarrassed to ask this as I don't hear others question it, so I complacently take it as a "fait accompli". is this not so much, "What the"
    I am definitely not against a well targeted stimulus package, as I believe that money needs to go in to go around. I believe that corporations that extract so much from the economies are the ones that should do the stimulating as much as, if not more than the government.
  9. Standard member shavixmir
    Guppy poo
    07 May '15 05:48
    It doesn't take a genius to work out that if people are spending, the economy will grow (like the Marshall plan) and if people can't spend, the economy will shrink.

    Austerity has nothing to do with expanding the economy for the average Joe. It's about privitisation and a small group of people getting very rich. And in this respect it is very, very effective.

    The Chicago boys rules!
  10. Subscriber Wajoma
    Die Cheeseburger
    07 May '15 08:16
    http://www.debtbombshell.com/
  11. Standard member wolfgang59
    Infidel
    07 May '15 08:48 / 1 edit
    Originally posted by normbenign
    Spending recklessly more than revenues?
    No.
    By spending sensibly more than revenues?[/
    We (the first world) got rich by individulas do exactly that.

    edit: It's called investment.
  12. 07 May '15 10:18
    Great, so we can not have the Tories, and instead have the party that tried very hard to
    introduce all the bad parts of Orwell's 1984, and treasonously dragged us into an
    unnecessary war under false pretences....

    Or we can have parties that are flat out racist xenophobes, or who look at Russia
    sabre rattling and threatening and bullying all it's neighbours including NATO members
    and think, "Hey, I know what we should do, get rid of our Nuclear deterrent, and all
    just sit down and talk things over. Because that will totally work."

    Or we can have environmental parties that seem to think that the solution is for us all
    to live in energy austerity instead of realising the vital role that energy plays in wellbeing
    and getting over their irrational fear of nuclear power. While also irrationally denying the
    benefits [and massively inflating the risks] of GMO.


    This is not a one issue election, the economy is one of the issues at stake, but it's not
    necessarily the most important one.

    Yes, austerity doesn't work. I'm still about to go out and vote Tory.

    Not because I like them, but because there is no other viable party I can vote for.

    If you want to vote for the party that thought ID cards and national biometric databases were
    a good idea, while increasing the risk of terrorism with ill-planed, massively expensive, and
    unjustified wars, while lying to parliament and the people...
    Then on your head be the consequences.


    Note: Incidentally, I should note that my father is a [now retired] Chartered Accountant who
    specialised in tax. And he can attest to [and this view is industry wide] how biblically badly written
    and ill-conceived the legislation was during the last labour government. There have been countless
    millions spent in lawsuits in disputes over what the laws mean because they are so badly written,
    and countless more in business spending on specialists like my father because the laws are
    incomprehensible and thus impossible to follow without expert guidance. Laws have always been
    badly written, but the previous government set new lows in gibberish. How much they spent is
    only part of the story, is all I am saying.
  13. Standard member finnegan
    GENS UNA SUMUS
    07 May '15 10:57 / 1 edit
    Originally posted by googlefudge
    Great, so we can not have the Tories, and instead have the party that tried very hard to
    introduce all the bad parts of Orwell's 1984, and treasonously dragged us into an
    unnecessary war under false pretences....

    Or we can have parties that are flat out racist xenophobes, or who look at Russia
    sabre rattling and threatening and bullying all it's ...[text shortened]... new lows in gibberish. How much they spent is
    only part of the story, is all I am saying.[/i]
    Well the point of my thread is to demonstrate that austerity does not work and is in fact harmful and you appear to accept this is the case. Seeing the evidence that the initial two years of ConDem austerity screwed the economy and killed stone dead a recovery that was well underway thanks to Gordon Brown, you will be voting for a repeat performance. Wow.

    I agree that elections are not about single issues. I disagree that the Tories are the party of civil liberties or non violence or ethical foreign policy. But I do agree that New Labour was rapidly losing its attraction and in an ideal world I would not vote in this election either for Labour's manifesto. I would probably find the Greens closest to my aspirations and values.

    The idea that alternative energy policies are bad economically is absurd. They not only offer immense potential for economic benefit, but also recognise that in reality the fossil fuel reserves in our geology are of negative value and cannot safely be exploited. The case for nuclear energy is not simple - the problem is how to evaluate risks that may be rare but are of such enormous scale when they happen. It is also a problem to trust the people who operate them. Economically, the subsidy environment makes comparative costing pretty dishonest and I fear the numbers can be manipulated to fit any prior commitment.

    Sometimes people forget that politics takes place within parties and not just between them. The Labour Party was diverted by Blair and can be redirected into more progressive policies. Instead of abandoning the party in search of new ones that are unpredictable, it is reasonable to work for change within Labour. Nothing is easy in politics.

    Anyway elections are not opinion polls. We are not asked to pick our ideal or favourite policy mix. We are facing an ugly contest and forced to choose the best realistic outcome in our grasp. That often requires tactical voting.

    In my case, I am voting for the only party that can get rid of the vile Esther McVey who worked so hard to make disabled people pay the cost of tax relief for the rich which is all the outgoing government was good for and which they propose to repeat if allowed. For me this is a single issue election and the treatment of the disabled has been a disgrace that must not be tolerated. It helps that we have a local Labour candidate without a trace of New Labour about her.
  14. Standard member finnegan
    GENS UNA SUMUS
    07 May '15 11:07
    Originally posted by wolfgang59
    No.
    By spending sensibly more than revenues?[/
    We (the first world) got rich by individulas do exactly that.

    edit: It's called investment.
    What revenues? Under austerity, revenues crash. With growth policies, revenues can expand to accommodate the relevant borrowing, and as happened historically, the outcome is indeed that we do not spend more than we earn - our earnings grow to support our spending. See the evidence.
  15. Standard member finnegan
    GENS UNA SUMUS
    07 May '15 11:14
    Originally posted by jimmac
    Just a related question, hopefully not of subject.

    It seems to me, ( an unlearned individual ) that when governments borrow, to stimulate the economy, this borrowed money just ends up, flowing to the top. i.e. the lower income will end up spending the highest % of what they get, the middle will save some and the highest will save a ...[text shortened]... onomies are the ones that should do the stimulating as much as, if not more than the government.
    I believe that corporations that extract so much from the economies are the ones that should do the stimulating as much as, if not more than the government.
    Well the corporations are cash rich and not investing because the demand in the economy is insufficient to make it worth their while and also because cheap labour makes it less urgent to improve productivity. hence you will notice that Britain's balance of payments is in crisis - we are not competitive and our currency is over rated - because it suits the finance sector, not the business world. Low interest rates and cheap borrowing costs favour the speculators and gamblers rather than the investors these days. Hence for example soaring property prices, which reflect nothing good or useful for our economy. In London we have insane and untaxed foreign investment in empty mansions. Elsewhere, far too much of our social housing has been sold off and we see the growth of spiv private landlords making fortunes out of excessive rents subsidized by a soaring housing benefits bill.