Introducing Talk Issues and “how to become thriftier without anybody minding”…

Partly to keep a weather eye on some of the big ticket issues in the British General Election, I’ve thrown my cap in with TalkIssues.org. The whole idea is to take a closer look at some of the actual politics of the campaign, rather than the gossip, scuttlebutt and air punching that grab so much of the big media’s attention. My first piece is a quick pass on the issue none of the main British parties want to say too much on, the paying down of debt and the settling in of a sustainable long term recovery

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  • andnowwhat

    Oh, I don’t know….how about getting the banks to lend to small business to get people back to work so we have tax payers rather than tax drains.

    I personally have a friend who empoyed 15 men, there’s work for them all but he cannot get the needed loan even though he has a fantastic credit history (as its ABI, his is probably better than their’s).

    Sounds simple to me. He gets people off the dole, back paying tax sand pays the bank interest. Now, what’s the issue? I must surely be missing something

  • Cynic2

    One of our staff left three months ago. He’s been back in work telling others how fantastic it is. With a wife and one child on the dole and various benefits he gets more than we could pay him. He’s been urging them all to get themselves sacked to join him. Funny old world isn’t it.

  • Drumlins Rock

    that answers one question, find the money by cutting dole payments!

  • andnowwhat

    Cutting the dole? What a great idea. We call all enjoy the rise in the black market and crime plus the financial demands of the needed increase in police manpower while wee spend the extra few pence the cut affords us.

  • Mick Fealty

    andnowwhat,

    That’s true, it would be simple. The banks are slowly squeezing otherwise viable businesses, by crystalising their bad debt at the beginning at the end of each financial year, and then easing it off as we get to the year end.

    The effect is that most small businessmen are living on the edge of viability and swimming as fast as they can in front of a huge banking shark.

    Just keeping ahead of the hindmost for the next few years by cutting cost and driving up productivity is going to be the only way to survive.

    But in the UK Ireland and the US are living on huge bed of unsustainable debt (with Germany and China sitting on unfeasibly large savings).

    The pressure to keep on with a downward pressure is likely to continue in the foreseeable future.

  • Mick Fealty

    DR,

    It would not be the smartest social policy to cut social welfare in a recession any more than Bertie’s massive hike in same was a great idea when the money was flowing in.

    If such cuts are necessary, it needs to happen when times are good. George Osborne was not wrong when he said Brown should have mended the fiscal roof when the sun was shining.

  • andnowwhat

    The only way I see that a goverment has of paying of its debts is to increase its taxe revenue and fix its trade balance Mick. The first requires an injection in to private businesses by non goverment and the second requires serious searching in the world markets for gaps that our goverment (Irish, British, whatever. That stuff isn’t my bag) exploit by pointing them out to firms and designers.

  • jtwo

    John Lanchester is (again) good on this at the LRB http://www.lrb.co.uk/v32/n05/john-lanchester/the-great-british-economy-disaster

    Key passages: ” The reality is that the budget, and the explicit promises of both parties, imply a commitment to cuts of about 11 per cent across the board. Both parties, however, have said that they will ring-fence spending on health, education and overseas development. Plug in those numbers and we are looking at cuts everywhere else of 16 per cent.”

    And

    ” As Stephanie Flanders of the BBC points out on her excellent blog, when the rhetoric is stripped out and the differences between the parties emphasised, they come down to a largely cosmetic debate about the timing of the cuts, and a difference of about 1 per cent of GDP.”

  • Greenflag

    ‘The banks are slowly squeezing otherwise viable businesses’

    ‘The first law of bankers is and woe betide the banker who doesn’t heed it .
    Never lend any money to anybody unless they don’t really need it’

    Small businesses and aspiring homeowners actually ‘needed’ the money to fund their respective ambitions . The ‘ambitions’ of the banks were on a much vaster scale -because from out of financial deregulation there arose new financial institutions -call it innovation;) (theft is a crude term ) which conspired to turn banks into building societies and investment banks into commercial banks and then lumped in the bigger insurance companies into the credit risk mix to obfuscate the financial world with new found financial weapons of mass economic destruction (Warren Buffet’s term ).

    What the banks are doing is ‘recapitalising ‘ for the next upswing . Not content with having been bailed out by taxpayers in the USA, UK and Ireland they are now grinding out every cent they can get from small business people and consumers . The shark can only move forward or die . Bankers are not keen on death -not their own anyway ;(

  • Drumlins Rock

    PS. I was just taking the piss in response to Cynics comment about being the guy being better of on the dole, shouldnt be that way but no magic way to fix it.

  • Greenflag

    Mick,

    ‘George Osborne was not wrong when he said Brown should have mended the fiscal roof when the sun was shining.’

    The same could be said of every western (USA /UK/Ireland etc over the past decade or in some cases even two . But given the ‘system’ and the short term nature of political options what are the chances that had Osborne been in power when the ‘sun ‘ was shining that he’d have done anything different than Brown ?

    Slim to none I’d suggest .

    As for Bertie over priming an already well primed pump ? Alan Greenspan would have merely accused Bertie of over exuberance ;( and that all would be well on the day . Sic transit gloria Homo Chicago Economicus .

  • Mick Fealty

    GF,

    that is a perennial problem with all pols, it doesn’t mean he’s not wrong though.