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Eeternaloptimist
01 Mar 11 23:33
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Date Joined: 28 Jun 10
| Topic/replies: 1,696 | Blogger: Eeternaloptimist's blog
Anybody any idea? Obviously not the left because they never have.

Just to remind people this was at a time when the economy had been growing since the mid 90's, when the bubbles were being furiously blown up by Gormless Clown, when he was busy letting millions flood into the country and when he was busy hiking taxes and inventing countless new ones.

So how much do you think he borrowed at a time when his old mucka Keynes suggested that you should be paying your debts off?
Pause Switch to Standard View How much did Brown borrow between...
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Report golfjudge March 2, 2011 4:39 PM GMT
Blackie - absolutely, so cut them. I don't oppose every cut. But I also know that an 80 odd million target is barely breached by cutting public-sector fat cats. They're just an easy target, like the 20K housing benefit claimants. The overwhelming burden of pain is being passed on to decent, hard-working people who saw little of the boom in the first place.
Report Eeternaloptimist March 2, 2011 4:43 PM GMT
Horrible waste of money, all that expenditure on schools and hospitals...if only it hadn't been "wasted"....

I see cheese's reasoning ability hasn't improved since he has been away. As has been pointed out many times much of that spending was done on PFI which is off balance sheet. So whether it was wasted or not is irrelevant to the issue of Brown borrowing vast sums of money as he approached the top of an engineered boom.

Try again cheese.
Report V4 Vendetta March 2, 2011 4:44 PM GMT
There's an argument put forward by the bank-bashers who refuse to celebrate Barclays and other great British companies who survived without bailouts:  That they benefitted by the system being propped up.  I believe you have used it before?

That being the case, everyone whose living standards rose during the Brown boom benefitted by increase economic "activity" which was a mirage.  As it was low interest rates at the heart of it, higher ones would be the best way to reverse it.
Report Eeternaloptimist March 2, 2011 4:45 PM GMT
zil - if the price and maturity of our debt is anything to go by, the markets are not going to decide this country is fecked. I believe both were coming down before the election.

Indeed they were golfy. Can you think why?
Report blackburn1 March 2, 2011 4:46 PM GMT
gj, I'm not sure who did see much of the boom tbh, it was a mirage. Others have spoken of the golden years, but as pointed out they couldn't have been that golden or either as individuals or as a govt our debt wouldn't have grown.

Its interesting you mention £80m, thats the figure, according to benny, that labour say they would cut the defecit by in 4 years without naming a single cut, to my knowledge Osborne hasn't made such a pledge.

My whole point is that as a nation we have become fat, lazy and dependent on handouts and/or credit, only a harsh dose of reality will change things.
Report blackburn1 March 2, 2011 4:53 PM GMT
Blimey goring used "mirage" while I was typing

Shocked

Example gj, bloke I know had approx £250k equity in his house (equity haha) with a knowing grin he remortgaged a lot of it and bought 4 btl properties with 85% interest only mortgages. We all know the rest of it.

Was that what is now known as the golden years?
Report golfjudge March 2, 2011 5:00 PM GMT
Perhaps you could clarify why in this 6p-8p in the pound issue you use the dates you do? It seems they are timed almost perfectly to do maximum damage to the Tory position and minimum damage to Labour.

Look on the site, the graph is since WW2 and I also mentioned it was lower for most of that period. The reason I used 96 is simply because its mentioned in the text, and it indeed represents the perfect timeframe with which to measure the analysis. If it were 97, Tories would probably claim Brown borrowed a fortune after May 1st.

This point of 8p isn't particularly high either by historical standards. If you look at the graph, it actually looks like classic boom/bust economics throughout the whole era.

My point is simply that if 8p were sustainable, (a golden legacy, no less) in 1996, it is stretching credibility to say 6p now is unsustainable, representing a national crisis to which there is no alternative than to savage cuts.

Given the fact that we are projected to still be borrowing about £80 billion a year at the end of this parliament perhaps you could tell us how much in the pound debt payments will be then even allowing for these historic low interest rates?

Of course I can't give you that figure and nor can Gideon. I'm sure the OBR and various economic institutions will make their projections, though I can't see why they would be any less inaccurate than usual.

Lets be clear. I want our debt to go down. I want us to be paying less in future, and have repeatedly put forward coherent proposals to do so. I don't see any sense behind making arbitry targets - like eliminating or halving the deficit in 5 years. It is about getting the long-term right.

In any case, I passionately believe that Gideon's strategy will be an unmitigated disaster, thus making all these projections meaningless. I've yet to find anyone who believes the OBR's projections of private sector job growth (unless public sector is simply privatised with same people reclassified).
Report golfjudge March 2, 2011 5:08 PM GMT
Goring - I made a few quid on my house since 03, and don't mind paying a bit more tax in that regard. Land Value Tax would be my ideal. Another plan would be to tax multiple property ownership, so all those btl landlords paid their share.

As for these savers, would they be involved with the UK institutions
that were lending £7 out of every £10 the state was borrowing at the last budget?
Report Eeternaloptimist March 2, 2011 5:09 PM GMT
I do respect that view even though I disagree with it and acknowledge that you are one of the few who did put forward alternative proposals. Obviously I take a different view to yours and remember well similarly apocalyptic pronouncements the last time a government refused to take the politically expedient option of spending vast sums of money to ameliorate (in the short term) the effects of recession. In fact I seem to remember that Mervyn King may well have been one of hundreds of leading academics and economists who wrote to The Times decrying Thatcher's policy during the savage recession of the early 80's.

We came out of that one in pretty good shape as I recall.
Report golfjudge March 2, 2011 5:18 PM GMT
EO - this fixation with Thatcherism is precisely the problem. Its as if Gideon neglected to study any other country in any other era when doing his history degree.

Thatcherism didn't work anyway. They did not control the money supply, repeatedly missing their targets. They would never have balanced the books without the massive NSO receipts, or massive one-off privatisation receipts. We can argue all day about the social legacy, but at the end of the Major govt, there was massive welfare dependency including nearly 3M on incapacity benefit. That doesn't excuse New Labour in any way, but any analysis of the 1980s experiment is incomplete without it.

The only other precedents I've heard are Canada and Sweden in the 90s. Yet they are actually a vindication for waiting for recovery, and better trading conditions. Those countries could cope with cuts, because there was a vast worldwide boom underway to fill the gap.
Report Dr Crippen March 2, 2011 5:33 PM GMT
Another plan would be to tax multiple property ownership, so all those btl landlords paid their share.

They pay their share now through income tax.
Report golfjudge March 2, 2011 5:39 PM GMT
So do the workers, Dr C.

Taxes can be introduced, or raised. We're all in this together after all.
Report Dr Crippen March 2, 2011 5:42 PM GMT
If they already pay tax, what do you want another tax for then?
Report Eeternaloptimist March 2, 2011 5:47 PM GMT
golfy

It isn't a fixation with Thatcher or Thatcherism. I regularly acknowledge her failings and I accept all those points to a lesser or greater extent. It doesn't repudiate the fact that during her tenure we quickly came out of a deep recession without having had the levels of deficit spending which we are now.
Report golfjudge March 2, 2011 5:50 PM GMT
Dr C - to help repair the public finances, just as the government are doing with their other extra taxes. I just think its fairer to ask those who benefitted most from the boom to pay a greater share towards the bust, than those who never really saw much of a boom.

EO - I was directing it at Gideon, not you.
Report flushgordon March 2, 2011 5:56 PM GMT
nothing-he had a company car and his mortgage was being paid.
Report Eeternaloptimist March 2, 2011 6:02 PM GMT
golfy

To be fair (or critical depending on your viewpoint) to Osborne he is hardly on a Thatcherite quest to squeeze public spending and avoid massive budget deficits whilst in or around recession. What is the projected budget deficit for this second year of the Tory administration?
Report Eeternaloptimist March 2, 2011 6:04 PM GMT
By the way I agree with a LVT and making those parasitical buy to let-ers stump up.
Report Dr Crippen March 2, 2011 6:09 PM GMT
golfjudge,
I can't see how private landlords did so well out of the boom, what about those whose properties are worth less now than what they paid for them?

They're already tens of thousands of pounds out of pocket, and you want to rub their noses in it as well with another tax on their meagre rental income.
There must be plenty of btl people who have taken up to 40% hits on their investments.
Report Eeternaloptimist March 2, 2011 6:16 PM GMT
I very much doubt that. Which part of the country has seen property drop by 40%? Plus you would have had to have timed it incredibly badly buying at the very top and I doubt there are "plenty" who did that. Similarly if I were to invest in something like silver then if I made a pile I would have to pay capital gains tax on it. If I made a loss I would have to take it on the chin. How/why are/should BTL's be any different?
Report golfjudge March 2, 2011 6:23 PM GMT
EO - We're into projections again. They're politically motivated guesses. If he undershoots his prediction, hey presto, the policy's working.

What I do accept is that he/they are less Thatcher than a more contemporary Conservative, Bush, albeit without (thankfully) the means of invading countries. Whatever her wider agenda, sorting the economy was I accept her main purpose. The era and conditions were completely different and some of it was very necessary.

This mob have a classic neo-conservative agenda, an ideological revolution. Free schools are Charter Schools. Social programmes declared to be 'failing' via dodgy accounting measures like 'opportunity cost'. Services outsourced to the private sector and their friends in certain churches. Piece by piece, the state torn down and handed over to the corporations. Soon there will doubtless be attacks on workers' rights. When the time suits, there will be tax cuts for the rich. It is Naomi Klein's Shock Doctrine, almost to the letter.

Whether any of this serves the economy is ultimately immaterial to them. They'll have convinced themselves that their economic plan will work beyond the textbook, and will have no end of research from oligarch-backed think-tanks to justify any response.
Report Dr Crippen March 2, 2011 6:36 PM GMT
very much doubt that. Which part of the country has seen property drop by 40%?

EO, then what you obviously don't understand is the way that they work out the drops. You're going on the average price, some are down a lot more than others in the same area.
Some sales can have been hardly affected, while just down the road they could be going for plenty less.

And the top as you call it, can vary quite by a lot as well.
Report Dr Crippen March 2, 2011 6:42 PM GMT
It’s similar to the stock market, the all share index might rise on the day but plenty of  stocks could have lost even though  more have gained.
Report Eeternaloptimist March 2, 2011 7:28 PM GMT
Doesn't invalidate my point that if you speculate in most things you pay the tax and it should be the same for houses.
Report Dr Crippen March 2, 2011 7:43 PM GMT
It is the same for houses.

My reply was addressed to people who seem unaware that a landlord pays income tax on the rents that he collects, and is also subject to capital gains tax on the profit if he makes one, when he sells a property.

And golfjudge wants to burden landlords with another tax on top!
Report Dr Crippen March 2, 2011 8:12 PM GMT
A little beauty from New Labour, was starting to charge council tax on houses that are standing empty.
You can now pick up a property to renovate, and you might have to pay council tax on it from the word go, even though there is no one living there.

Or you might be left a property in a will, which you might be unable to sell, or to let, or don’t want to let, but you still have to pay council tax on it.
There must be some very worried people about now, paying council tax for empty properties they never even asked for or wanted.
Report V4 Vendetta March 2, 2011 8:31 PM GMT
Blimey - can't keep up here.  Only put kids to bed and opened a claret and there's 25 more messages.

Goring - I made a few quid on my house since 03, and don't mind paying a bit more tax in that regard.

No one is against voluntary contribtions of course, but I'm surprised you'd rather the government spend your surplus than you do it yourself. 

Another plan would be to tax multiple property ownership, so all those btl landlords paid their share.

Yeah, but you'd get me too and I've never had a mortgage.  Putting interest rates up to the right level would sort 'em though (cue Crippen...)

As for these savers, would they be involved with the UK institutions
that were lending £7 out of every £10 the state was borrowing at the last budget?


You lost me here.
Report golfjudge March 2, 2011 8:52 PM GMT
Goring - at the last budget, I believe that £7 out of every £10 we were borrowing was from UK savers and institutions. I'd be interested to know who you think that is lending the money (pension funds I assume make up a chunk). Is this such a bad thing? Can it not be seen as offering a safe alternative for savers to compensate interest rises?

Dr C - pretty much everyone is being clobbered, and they could all say the same. My point is we had a boom based on finance and property, which for good or ill, led us to where we are now. I am saying that those who did particularly well out of that arrangement should pick up a greater share of the burden than those who didn't.

There's a much deeper point. EO and I are from completely different political perspectives, yet we both like Land Value Tax. Because we want to see an economy where land speculation plays a much smaller role and investors look towards more productive sectors. The tax is based on the potential economic value of the location. So if you own an empty house in downtown Hull, you'll barely pay anything. But if you own 20 rental flats in central London, you will indeed be clobbered. I'm sure someone in that position can cope.
Report Dr Crippen March 2, 2011 9:10 PM GMT
Land Value Tax.

Would that hit everybody who owned their own home then?
Report Bentley Boy March 2, 2011 9:13 PM GMT
Excellent stuff gj as always, but while it's easy to pick holes in the current showers attacks on the public sector and to see the likely outcome in terms of social unrest due to rising unemployment poorer housing and schools etc. Where's the alternative coming from iyo as already said if Labour say nowt for the next 4 years they might win but dont we need a new and better approach that says were not only going to be better at managing the Country than the Right but we're going to do it differently and start developing these ideas now. Coming out now and saying no to Trident would be a start and then develop other arguments and give the GBP something to think about when people are losing jobs while the city carry on regardless treating everyone else with barely concealed contempt.
Report blackburn1 March 2, 2011 9:13 PM GMT
The problem with another tax is trusting people to do the right thing with it. We're in this state mainly due to public money being wasted so I'm against giving these fools any more
Report Dr Crippen March 2, 2011 9:20 PM GMT
They don't seem to realise that higher taxation means fewer jobs, for how can the private sector expand if you tax it to death, and then take the money to pay people more to stay at home than to work?
Report golfjudge March 2, 2011 9:24 PM GMT
Dr C, Blackburn - over the long-term, there's no reason why lvt should mean the govt raising any more or any less tax. Its just part of a tax programme, that would rise or fall depending on how much the govt felt it had to raise. Just like they do now with all the other taxes.

Right now, I'm saying property tax rises are preferable to cutting childcare allowance, tax credits and EMAs, which the working and middle class workers and parents rely upon. People who didn't see much of the boom, and whose budgets are going to be butchered in the coming months.
Report blackburn1 March 2, 2011 9:29 PM GMT
gj, this boom you refer to - can you be more precise?

The govt needs to reduce spending ahead of increasing revenues, people are sick and tired of so many different taxes when they see how much is wasted.
Report golfjudge March 2, 2011 9:40 PM GMT
Bentley - good to speak to you, hope you're well.

I think those ideas are well-developed already. There has been energy on the intellectual left for a couple of years, and since the election the movement has suddenly awoken. The lefty blog presence has improved beyond measure. Partly because of Lib Dems betrayal, loads of people, not just the young but predominantly under 40, have suddenly become active.

Labour are by no means attached to these voters, and who would dare to predict which way they'll go. They've been offered this incredible reprieve - from being a moribund party with few activists and little energy, in danger of third place and oblivion, they have the opportunity to change, and attract this educated, energetic movement. We can only wait and see if they will.

Its very similar to what happened under Bush, with the likes of moveon.org. We share the same set of enemies.
Report Dr Crippen March 2, 2011 9:42 PM GMT
Who would pay this LVT?
Report golfjudge March 2, 2011 9:48 PM GMT
The owners of land

http://www.landvaluetax.org/what-is-lvt/
Report Bentley Boy March 2, 2011 9:59 PM GMT
gj,
I'm good m8 hope you're well too, good to see you back.
Report mjt March 2, 2011 10:00 PM GMT
So would someone with a mortgage of 95% ltv and little if any disposable income be subject to your land tax gj?
Report golfjudge March 2, 2011 10:03 PM GMT
MJT - Yes, and there's also a massive chance they'd be subject to your cuts in tax credits, childcare allowance, EMAs amongst other things. The odds are under my regime they'd be better off.
Report mjt March 2, 2011 10:05 PM GMT
Evidence please.

Thanks.
Report golfjudge March 2, 2011 10:07 PM GMT
Evidence of what can be raised by a hypothetical alternative tax system, the level of which has yet to be decided? I'll let you know the figures in my first budget.

Or evidence that people are losing those things?
Report mjt March 2, 2011 10:11 PM GMT
tax credits, childcare allowance, ema.....all temporary benefits and short term.

Your LVT will be a permanent and ever-increasing family home tax.

Your tax will hit those with little or no spare income and even worse pensioners on fixed income who won't be claiming the benefits you mention.

Dress up your crackpot ideas in all the flowery language you like gj but they're still crackpot. Laugh
Report mjt March 2, 2011 10:12 PM GMT
However, if you'd like to apply this tax of yours to commercial and private land banks outside the scope of individual family dwellings then i'm all ears.
Report golfjudge March 2, 2011 10:26 PM GMT
mjt

Firstly, its precisely the type of commercial land banks, along with property speculators, that are worst affected. That's exactly the point - it should not pay to hoard unused land.

So far as this idea that its a permanent family tax, it is no more or no less than already exists. Political parties would make a policy of raising or cutting the lvt as they do with other taxes. One idea was to replace council tax with it.Just as now, it would depend on the public finances.

As for the three benefit changes, the fact they're short-term is precisely their appeal. A working mother doesn't become long-term dependent on child-care allowance. Rather it helps her take a job. Tax credits are an essential lifeline to the millions working in casualised industries, reliant on short-term, temporary contracts. EMAs help kids from stay in education for 2 years, the benefits of which is incalculable.
Report mjt March 2, 2011 10:36 PM GMT
Tax credits are a stupid way of taking money off someone and then giving it them back - use negative income tax if you want to make work pay.

The left have long acknowleged that universal child allowance was kept because it allowed the middle-classes to feel like they were getting 'something back' from the welfare system and so made them more amenable to funding it.

EMA - 'the benefits are incalculable'...sorry, I disagree. It's a vehicle to keep kids off the unemployment figures which has been a tactic employed for decades. We are saddling a generation of kids with the debts of a university education that gives the majority of them a -£30k+ start to their working lives without the degree to dig themselves out of the hole, although they will have the pleasure of your LVT to look forward to when they finally scrape together a deposit.

If you're going to Uni to study a degree with a real value to employers then great - if you're doing underwater basket weaving at the University of Nowhere then you need your head feeling.
Report Dr Crippen March 2, 2011 10:41 PM GMT
People with commercial properties would pass on the tax to their customers.
Landlords would pass it on to their tenants.
So the ones who would be hit by the tax as usual are the hard working types struggling to pay their mortgages and rents, and they pay too much tax already.

If it merely replaced council tax, then what's the point?
Report Dr Crippen March 2, 2011 10:47 PM GMT
We need to cut spending, not just keep putting up taxes.
The more we tax the more we seem to find things to spend it on.
I don’t buy this tax and spend business at all, too much of it goes on benefits and making public sector workers rich, and at the end of the day we seem worse off than before we started - New Labour have proved that with the current situation.
Report golfjudge March 2, 2011 10:56 PM GMT
I prefer universal benefits, as social rights, absolutely. We're not in that place, though, or likely to get there any time soon. In their absence, tax credits are the lifeline I mentioned.

I find it bizarre that this generation of Tories and political classes are so out of touch with the real 'Middle England' to not realise how many people are affected by these things. Who could very soon be pushed over the edge into debt crisis. Many of them are Tory voters, they're ordinary middle-earning workers.

Again, EMAs go to households earning less than 30K - half of all households. It has not been going on for decades at all, I think it only came in under Brown. The reason they are incalculable is because you can't measure how the same kids would fare over their lifetime without it. If on average they go on to achieve more with their life than otherwise, it was a good investment.

As for your snobby comments about unis, you're just confirming how out of touch with the average person Tories are. You lot are masters at knowing the cost of everything but the value of nothing. University is a life-changing experience in no end of ways. Best money I ever spent, and I never went with a view to a career or pursued one related to my degree.
Report Eeternaloptimist March 2, 2011 11:04 PM GMT
Some of the issues addressed:

The advantages...

    * A NATURAL SOURCE OF PUBLIC REVENUE. All land makes its full contribution to the Exchequer, allowing reductions in existing taxes on labour and enterprise.
    * A STRONGER ECONOMY. If we tax labour, buildings or machinery and plant, we discourage people from constructive and beneficial activities and penalise enterprise and efficiency. The reverse is the case with a tax on land values, which is payable regardless of whether or how well the land is actually used. It is a payment, based on current market value, for the exclusive occupation of a piece of land. In the longer term, this fundamentally new and different approach to revenue raising will stimulate new business and new employment, reducing the need for costly government welfare.
    * MARGINAL AREAS REVITALISED. Economic actitivities are handicapped by distance from the major centres of population. Conventional taxes such as VAT and those on transport fuels cause particular damage to the remoter areas of the country. Land Value Tax, by definition, bears lightly or not at all where land has little or no value, thereby stimulating economic activity away from the centre - it creates what are in effect tax havens exactly where they are most needed.
    * A MORE EFFICIENT LAND MARKET. The necessity to pay the tax obliges landowners to develop vacant and under-used land properly or to make way for others who will.
    * LESS URBAN SPRAWL. Land Value Taxation deters speculative land holding. Thus dilapidated inner-city areas are returned to good use, reducing the pressure for building on green-field sites.
    * LESS BUREAUCRACY. The complexities of Income Tax, Inheritance Tax, Capital Gains Tax and VAT are well known. By contrast, Land Value Tax is straightforward. Once the system has settled down, landholders will not be faced with complicated forms and demands for information. Revaluation will become relatively simple.
    * NO AVOIDANCE OR EVASION. Land cannot be hidden, removed to a tax haven or concealed in an electronic data system.
    * AN END TO BOOM-SLUMP CYCLES. Speculation in land value - frequently misrepresented and disguised as "property" or "asset" speculation - is the root cause of unsustainable booms which result periodically in damaging corrective slumps. Land Value Taxation, fully and properly applied, knocks the speculative element out of land pricing.
    * IMPOSSIBLE TO PASS ON IN HIGHER PRICES, LOWER WAGES OR HIGHER RENTS. Competition makes it impossible for a business producing goods on a valuable site to charge more per item than one producing similar goods on less valuable land - after all, producers and traders at different locations are paying different rents to landlords now, yet like goods generally sell for much the same price and employers pay their workers comparable wages. The tax cannot be passed on to a tenant who is already paying the full market rent.
    * AN ESTABLISHED AND PROVEN SYSTEM. Local government variants of Land Value Taxation, known as Site Value Rating, are accepted practice in, for example, Denmark and Australia.

Is it fair...

Land (unlike goods and services) has no cost of production. If an ample supply of land of equal desirability were available everywhere, there would be nothing to pay for its use. In reality land acquires a scarcity value owing to the competing needs of the community for living, working and leisure space. Thus land value owes nothing to individual effort and everything to the community at large. It belongs justly and uniquely to the community. Conversely, the reward for individual effort can belong only to the one who earns it, to spend, save or give away as he or she may see fit.

Because of differences in positional advantages, fertility or natural resources, some locations are more desirable than others. Demand for access to these features gives land its rental value. Land Value Taxation, being assessed on these values, is fair in its incidence.
Report Whippet March 2, 2011 11:07 PM GMT
What is with the lefts obsession with giving people benefits?

The only reason they do it is to create a reliance on the welfare state (i.e more voters for them).

Lowering tax for everyone achieves exactly the same thing.

In 11 years of boom, did labour reduce the tax burden? Nope, they increased it (and increased the benefits at the same time). In that boom period, were the poor any better off? Nope. In fact the gap widened. 

Lowering tax makes the whole country better off.
Report Dr Crippen March 2, 2011 11:15 PM GMT
* LESS BUREAUCRACY. The complexities of Income Tax, Inheritance Tax, Capital Gains Tax and VAT are well known. By contrast, Land Value Tax is straightforward. Once the system has settled down, landholders will not be faced with complicated forms and demands for information. Revaluation will become relatively simple.

How can more equal less?
Report Dr Crippen March 2, 2011 11:20 PM GMT
I see now i found this on another page from that link.

A single-issue non-party/all-party organisation based in the UK, we propose that the rental value of land should be collected and used as the principal source of public revenue, as a replacement for present taxes on wages, profits, goods and services
Report mjt March 2, 2011 11:21 PM GMT
Golfjudge

University is a life-changing experience in no end of ways. Best money I ever spent, and I never went with a view to a career or pursued one related to my degree. 


I think you meant...

'Best money I never spent'
Report golfjudge March 2, 2011 11:27 PM GMT
Whippet - how does one become dependent on childcare allowance or EMA?

Cutting taxes for everyone would further butcher the public finances, and vast chunks would simply be saved or invested overseas, therefore not stimulating the economy. To cut tax enough to replace the cost of childcare allowance would be enormous.

How have Bush's tax cuts fared in the US? It must be really helping the deficit giving away so much to so many millionaires. Who I'm sure all reinvest the cash in the US economy, rather than offshore.
Report mjt March 2, 2011 11:30 PM GMT
Cutting taxes for everyone would further butcher the public finances, and vast chunks would simply be saved



That is loony-left thinking a nutshell Laugh

Whatever you do don't let people have a little more of what they earn in case...wait for it...THEY SAVE IT!!!!!


LaughLaughLaughLaughLaugh
Report golfjudge March 2, 2011 11:37 PM GMT
So you think it would be sensible, despite the deficit, to give massive tax cuts? If it is saved, rather than spent, it won't help replace the demand you're already taking out and we won't get growth. As said, Bush's tax cuts were real successful eh? Must have been the neo-cons loony-left tendencies.
Report golfjudge March 2, 2011 11:37 PM GMT
Btw, what makes you an expert on my education?
Report mjt March 2, 2011 11:39 PM GMT
Yes, that's right Gj...the answer to our economy being ruined by excessive borrowing and spending is...

...more borrowing and spending  [smiley:crazy]
Report golfjudge March 2, 2011 11:46 PM GMT
What a lame response.

I'm not going to bother responding to blatant misrepresentations, the usual tactic. Anybody who's read or participated in this thread can see that is not what I'm saying.
Report Room 0182 March 2, 2011 11:54 PM GMT
gj quote

"The govt's argument is that 'we can't carry on like this'. Well if these stats [the meaningless 6% figure] are true and I await someone debunking them, history shows that unless the cost of borrowing rises, we can."

That looks like an endorsement of more borrowing and spending to me.
Report Whippet March 2, 2011 11:56 PM GMT
golfjudge
Date Joined:     08 Jul 01
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02 Mar 11 23:27 Joined: 08 Jul 01 | Topic/replies: 1,389 | Blogger: golfjudge's blog
Whippet - how does one become dependent on childcare allowance or EMA?

Cutting taxes for everyone would further butcher the public finances, and vast chunks would simply be saved or invested overseas, therefore not stimulating the economy. To cut tax enough to replace the cost of childcare allowance would be enormous.

How have Bush's tax cuts fared in the US? It must be really helping the deficit giving away so much to so many millionaires. Who I'm sure all reinvest the cash in the US economy, rather than offshore.



So you're saying, that taxing people at 40% during the boom years, and then spending billions on top of that in bribes for the poor was a good idea....?

Taxes should have been slashed to 20% for everyone (with anyone on under £20k not paying anything). This would have made the country far more prosperous than it was. And before you say, I know for a fact that this was affordable - if public sector spending had been kept in line with inflation from 1997 we would have actually been able to abolish income tax altogether if we so wished. However I am not unreasonable, which is why I think a 20% rate is fair.

It is obviously too late to go for this approach now because of the recession, but it should be kept in mind for when things don't recover. The socialist approach of stealing off people, then redistributing it back to them simply doesn't work. You just have to look at the huge number of unproductive public sector jobs created in the last 10 years to see that.

Make taxes low, and businesses will thrive, and from that, the rest of the population will thrive, rich and poor alike.
Report subversion March 2, 2011 11:57 PM GMT
just thought it would be funny to show what can happen if the finances are managed well, and not totally f*cked like in the UK

the HK government has just announced - ALL HK permanent residents to be given HKD $6000, with further rebates for income tax payers

they are rolling in money with their flat tax rate of 15% Laugh

i wonder what i should spend mine on
Report golfjudge March 3, 2011 12:02 AM GMT
No it isn't. Its pointing out that they are lying in saying that there is no alternative to deep front-loaded cuts, and the implication that our debt repayments are in any way unprecedented.

Rather, there is no end of historical precedent of countries maintaining a deficit for a substantial period of time and that the current cost of repayments is nowhere near as crippling as they would have us believe.

The things I'm talking are about political choices, what to cut, who wins, who loses. There are no end of such choices, irrespective of the deficit. Those three benefits can easily be covered elsewhere.
Report mjt March 3, 2011 12:11 AM GMT
Golfjudge

Rather, there is no end of historical precedent of countries maintaining a deficit for a substantial period of time and that the current cost of repayments is nowhere near as crippling as they would have us believe.



So the government INCREASE spending by c£50bn over the course of this parliament and you scream murder about the 'brutal' cuts.


Then in the next breath you tell us that the £40bn INTEREST ONLY costs of servicing the debts your Labour party left the country is 'nowhere near as crippling as they would have us believe'.


I'm sorry Golfjudge but if you're the standard bearer for the intellectual left on here then the country really is f*ked.
Report golfjudge March 3, 2011 12:16 AM GMT
So you're saying, that taxing people at 40% during the boom years, and then spending billions on top of that in bribes for the poor was a good idea....?

Once again, a Tory illustrating how out of touch with the common man and their values. I wonder how many working mums think they're being bribed with childcare allowance...

Had public sector spending had been kept in line with inflation from 1997 we would have actually been able to abolish income tax altogether if we so wished. However I am not unreasonable, which is why I think a 20% rate is fair.

And our country would have been a worse place for many, probably most, of its inhabitants. You lot really never got the message in 97 and 01 about the desire for more public spending. I'm no defender of Brown's methodology, but that doesn't alter the obvious legitimacy of it. Plus as discussed earlier, the Tories supported spending levels from 05 to 08.

What you are in effect arguing for is some abstract right-wing utopia that never has existed and never will. I appreciate yours is standard conservative view these days, just as in the US. The same social division  and class war is inevitable over here because clearly, the two sides' values are irreconcilable. 

The socialist approach of stealing off people, then redistributing it back to them simply doesn't work. You just have to look at the huge number of unproductive public sector jobs created in the last 10 years to see that.

I posted some questions about this public/private issue on the Privatisation MarkII, which I think you were involved in. Try and have a crack at answering them.
Report golfjudge March 3, 2011 12:20 AM GMT
To repeat, mjt, I'm not going to engage in misrepresentations. I've dealt with the debt repayments much earlier in the thread and am not repeating it.

If you actually want to engage in debate, about the many issues I've discussed in detail, I'm happy to chat.
Report Room 0182 March 3, 2011 12:44 AM GMT
GJ

There's no misrepresentation here. You want to continue to borrow and spend. You've said it repeatedly.
Report Eeternaloptimist March 3, 2011 1:46 AM GMT
golfjudge

You lot really never got the message in 97 and 01 about the desire for more public spending. I'm no defender of Brown's methodology, but that doesn't alter the obvious legitimacy of it.

That simply isn't true. In 1997 Labour promised to stick to Tory tax and spending plans. Having got rid of clause 4 that was the one noose still around Labour's neck and Blair knew this. What happened between 97 and 01 is that by sticking to their pledge they significantly reduced the public debt but crucially they got the British people to believe that the penny had finally dropped and that they truly could be responsible with the nations finances.
Report blackburn1 March 3, 2011 8:39 AM GMT
blackburn Joined: 15 Jan 02
Replies: 10105 02 Mar 11 21:29   
gj, this boom you refer to - can you be more precise?

The govt needs to reduce spending ahead of increasing revenues, people are sick and tired of so many different taxes when they see how much is wasted.


I still get no answer to what/when this boom was, if gj means that as individuals and a nation we were borrowning unparalleled amounts I guess he's right.

Reading the next 40 odd posts after mine it really seems that the left have simply no ideas left other than raise tax so useless politicians can spunk it.
Report golfjudge March 3, 2011 9:35 AM GMT
Blackie - apologies if I missed one of your posts, I have been trying to debate with about ten people simultaneously here.

The boom in question would be the one that saw a decade of continuous GDP growth. Vast sums earned by financiers, something like £45BN of equity withdrawals. It is not hard to define groups of winners from such an arrangement.

You talk of personal debt, well my generation had little choice. My last rented property in London, a 1 bed flat near Leyton Orient's ground, cost £810 per month to rent nine years ago. If you are on average earnings in the SE, it is easy to end up borrowling just to pay the bills.

Faced with such crippling options, we borrowed to get on the housing ladder. We weren't so lucky as previous generations who got council houses to rent, and then to buy on the cheap. It worked out for some of us, whose work enabled us to move around, for others its just been a hard slog.

EO - Labour's 97 pledge card was a series of public service commitments. The Lib Dems significant rise in those two elections came after the key lines "Raise 1p on income tax to pay for schools and hospitals' in 97, and Kennedy's 'People are smart enough to know that public services require extra tax and spending" as justification for taxing the rich more. Which rather explains why the support they built up over that period disintegrated as soon as they joined the Tories in govt.
Report blackburn1 March 3, 2011 9:42 AM GMT
My point entirely gj it never was a boom, it was a debt fuelled binge where ordinary people were seduced by rising property prices, like lemmings they queued up at NR with no deposits and a self cert form.

OK the banks benefitted for a while as did estate agents and solicitors, but all the while debt was rising at ridiculous rates. And now gj, you want to put your foot on the throats of these ordinary people by imposing a land tax!
Report golfjudge March 3, 2011 9:45 AM GMT
Room 0182 - I simply don't accept the parameters of this argument. That if you oppose this govt's strategy, then you're in favour of higher spending and borrowing. I certainly don't buy into timescales based on electoral cycles - eliminate/halve the deficit in 5 years? Why? On what basis can any meaningful projection can be made over that timescale?

They are politically motivated guesses, from people with an appalling track record. I refuse to have faith in a Chancellor who thought Ireland in 2006 was a model economy and who was committed to spending plans he now condemns, as recently as 2008. If as I strongly expect, the plans hurt growth and tax receipts, they'll end up borrowing more, and doubtless cutting more. It is pure ideology and as argued earlier, a failed one at that.

I've laid out various clear political choices in what they're doing, and have barely started. Taxing the rich more doesn't require borrowing, and reduces the need for cuts, which will reduce demand. I don't even oppose all the cuts. There are no end of alternatives. It just requires removing oneself from the intellectual straitjacket our politics has locked itself into.
Report golfjudge March 3, 2011 10:15 AM GMT
Blackie - at least read the stuff about the lvt before commenting. There is no sense that this would mean being introduced as an 'extra' tax on people with one home. In some cases where the property is particularly valuable, maybe, but it would be balanced around other tax changes. The struggling middle would not be penalised. Indeed out of the whole round of changes I would suggesting, they'll be better off. Instead, 'Middle England' is about to get butchered under Gideon's plans.
Report blackburn1 March 3, 2011 10:21 AM GMT
gj, I looked at the website.

The point is very clear here, another tax just will not work until the use of it is clearly defined.

Middle England as you call it, are hard working ordinary families propping up overpaid civil servants, too many politicians and their expenses and the underclass. The Middle England you talk about needs its direct taxes CUT, to give them a breather.

Phuck the well off and phuck those who cant be bothered, the majority need a break and a tax on what they've grafted for wont help. As crippen points out earlier, a land tax will mean rents go up which further squeezes those you want to help.
Report golfjudge March 3, 2011 10:32 AM GMT
Its perfectly well defined, and variants of it are used in other countries.

You're simply wrong in your assertions about who middle england are, what their needs are. Middle-earners are not particularly hit by heavy direct taxes, its the indirect taxes and removal of said benefits that will hurt them most. Moreover, its the cost of living, particularly housing but also things like transport. Soon, they can add childcare and paying more towards their elderly parents' care.

As for where all this money goes, 1/3 of welfare goes on the state pension. And efficiency savings, and public sector fatcats, are over-stated for political effect. Such savings may well exist, but they are a small fraction of any cuts. We'll see in the months ahead, when workers suddenly find their pay packets a couple of hundred quid light, when the scale of carers, classroom assistants losing their jobs becomes apparent, who is being hit and just what Middle England wants.
Report Eeternaloptimist March 3, 2011 10:36 AM GMT
blackie

One of the merits of a LVT is the difficulty in avoiding or evading it. It is expensive to transport it to Belize. I want the governments take to go down and I wouldn't support it as an add on. It also helps those who live in rural and/or unpopular areas who will pay less LVT.
Report blackburn1 March 3, 2011 10:38 AM GMT
We'll see in the months ahead, when workers suddenly find their pay packets a couple of hundred quid light, when the scale of carers, classroom assistants losing their jobs becomes apparent, who is being hit and just what Middle England wants.

Exactly my point which is why tax should be cut. The middle earners are sick to death of propping up those above and below them in terms of income.

You lot are obsessed with taxing and give no consideration to how its spent.
Report golfjudge March 3, 2011 10:42 AM GMT
And they'll be even sicker when their pay packets start coming in light soon.

Something tells me people losing £200 per month won't be appeased by a £20 per month tax cut.
Report Bentley Boy March 3, 2011 11:08 AM GMT
I'm sure many parents in middle income England(me and mrs B included) are delighted with the decision to treble tuition fees, while throwing money at better off parents to set up Free Schools thus enabling them to avoid expensive private school fees.
We're certainly all in this together although some of us are more "in it" than others imo.
Report mjt March 3, 2011 11:13 AM GMT
BB,

Smashed you own argument there.

If parents can create free schools for all to attend that are comparable with the quality of private schools then the policy will have been a fantastic success.

Unfortunately you Labour Loons are so full of hatred and political tribalism you would rather kids education suffer than see a Coalition policy succeed.

Remember Loons.....Labour Party First, Country Second
Report Bentley Boy March 3, 2011 11:19 AM GMT
If parents can create free schools for all to attend


You really are having a fooking laugh
LaughLaughLaughLaugh

And what about the single faith free schools, how do they square with Daves recent opinions on multiculturalism.
Report V4 Vendetta March 3, 2011 11:43 AM GMT
Golfy: Goring - at the last budget, I believe that £7 out of every £10 we were borrowing was from UK savers and institutions. I'd be interested to know who you think that is lending the money (pension funds I assume make up a chunk). Is this such a bad thing? Can it not be seen as offering a safe alternative for savers to compensate interest rises?

Well, it's bad because of the amount of borrowing, not because so much of it is domestic.  Yes, pension funds are the largest chunk.  If I understand your last sentence, you are saying that the government borrowing so much is good as it provides more Gilts ('risk-free' investment) for funds which is compensation for the artificially low interest rates?  If that's what you mean, it's not a good idea as it's crowding out borrowing by others (corporates etc) and you only need risk-free investments if companies are too risky...which they will be if the government hogs all the cash.
Report golfjudge March 3, 2011 11:57 AM GMT
you only need risk-free investments if companies are too risky

I would have said there's plenty of risky companies based on recent events and the general climate. How would all those stock-market linked pensions have got on if the state hadn't bailed the banks out when the FTSE was 3,500? The same pension funds haven't done too badly out of QE either.
Report V4 Vendetta March 3, 2011 12:06 PM GMT
Yes, there were plenty of risky companies because of the government crowding out on capital.  It's like jamming someone up the bum for an afternoon and then saying it's lucky for them that you stopped.  Better that you hadn't done it.
Report V4 Vendetta March 3, 2011 12:07 PM GMT
Not sure how funds did well out of QE.  The inflation demolishes fixed income and the govt only bought the bonds to stop the price falling through the floor.
Report golfjudge March 3, 2011 12:14 PM GMT
I'm working on the assumption that QE has boosted the stock market.
Report zilzal1 March 3, 2011 12:20 PM GMT
The stock market has done really well over the 21st century hasnt itLaugh

Im pretty sure its still below what it was on New Years eve 1999..
Report V4 Vendetta March 3, 2011 12:20 PM GMT
Yes, although funds are quite capable of **** into Gilts and out again at the right time.  The QE will add to long-term interest rates and inflation just to keep short-term ones artificially low.  Over the horizon of a pension, there's no benefit, just uncertainty.
Report V4 Vendetta March 3, 2011 12:21 PM GMT
Eh, thought I wrote shifting s h i f t i n g - is that 'rude' now too? Laugh  Maybe switching, can't remember, but it wasn't rude Big Brother, honest.  I love you....
Report golfjudge March 3, 2011 12:25 PM GMT
zil - that doesn't alter the fact that stock market has benefitted from the bank bailouts and QE.

If poor people were the beneficiaries, doubtless Whippet and co would be saying the govt only did it to buy their votes...
Report V4 Vendetta March 3, 2011 12:53 PM GMT
The stock market has 'benefitted' by devaluing the currency, that's why it's gone up.  Therefore, any savings have also been devalued (as the Gold price reflects).  Poor people have benefitted in the short-term as interest rates are being kept low to keep firms afloat which should have gone bust (like a lot of banks also).  They also benefitted from the boom / debt bubble.  However, we're _all_ losing as this is all malinvestment and mispricing which clouds the real picture and stops money and people getting in the places they should be for long-term growth.
Report Chippie in Whitehall March 3, 2011 6:51 PM GMT
Workhouses.
Flat tax.
Long prison sentences for all offenders.
Less state.
Leave the EUSSR.


Thank me later.
Report Eeternaloptimist March 3, 2011 7:08 PM GMT
Goring is an Austrian. I thought he made sense. Laugh
Report blackburn1 March 3, 2011 8:20 PM GMT
I'm with chippie
Report bazzar March 6, 2011 10:51 PM GMT
Brown originally borrowed £200, but with the exhorbitant rates charged by these loan sharks, it soon grew into a few billion pounds.
Report The beauty of Buzzer March 7, 2011 12:29 AM GMT
blackburn you are tarring estate agents and solicitors with the same brush when estate agents are more culpable and benefited more from the lending boom.Solicitors normally charge a flat fee not relevant to the price of the property they are conveyancing. Estate agents, on the other hand ,normally charge a percentage of the value so for example a house sold for £500k would give the estate agent at least 5k sometimes 10k whereas the solicitor would take at most 1k, £500 for some firms a few years ago. The estate agent has a vested interest in high house prices , the solicitor only in there being a fast moving market.
Report blackburn1 March 7, 2011 8:59 AM GMT
Some truth in that buzzer, my point is that they benefitted directly from the mirage ie they got paid, others just got sucked in believing they were making money when they weren't
Report V4 Vendetta March 8, 2011 8:43 PM GMT
As he grew rich he grew greedy; and thinking to get at once all the gold the Goose could give, he killed it and opened it only to find —nothing.
Report A.H HUNTER esq. March 9, 2011 7:23 PM GMT
I will have a guesstimate at £250 billion while the sun was shining ,but he also stole money from pensions and paid for a lot on the never ,never ,in reality he gave most of the money to government workers and to those who did not pay into the system .
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