Plan A - not working?

[observer]

Well it seems we're into a double dip recession and the "two posh boys" ideas of cutting out the heart to save the rest of the body, don't appear to be working. So do we need a Plan B, and what should it be?

[Cleopatra]

Yes you need a plan B. Launch the lifeboats!

[Lt Kije]

Speculate

[Bazj]

where does it say we are in a double dip recession?

[Egbert]

Well what we DON'T want is the Millipede alternative which appears to be solving the debt crisis by taking on more debt!

[wolfie]

Well that's how we got over the Great Depression.Cutting government spending in a recession only makes it worse.

[observer]

That seems to be the evidence of history Wolfie, and we've never been short of money for wars, so borrowing seems OK for that! Whilst it's the case that we've never (certainly since WW1) ran a balanced budget, we do need to get back to earning more than we spend. Problem is, like any small buisiness we need to get money from somewhere to kick start the economy. If we borrow on the international markets - down goes our credit rating and it costs even more to borrow - so we're between a rock and a hard place. So where is there money that could be used to fund some major infrastructure projects to improve our future economic profile and stimulate growth? Seems fairly logical - tax the rich and put more money in the pockets of the rest in order to stimulate demand and get the show on the road again.

[Dizzy]

.......do we need a Plan B, and what should it be?

 

Try an keep up with things Obs. Even I know that there is already a plan B in place (should it be needed of course) and that Plan B says 'please refer to Plan C'

[observer]

Errm, don't think so: Plan A is about austerity - period; it conveniently allows the "two posh boys" to inflict long held Tory prejudices against the great unwashed; one could easily imagine Osborne saying "let them eat cake". Meanwhile the Bankers are still getting their £5plus million a year salaries and their £20million share option bonuses, plus a reduction in their 50p tax rate, that they carefully avoid anyway - so I guess we're all being CONned by the CONservatives!

[Cleopatra]

'Let them eat cake'. Most people assume that when she uttered those words Marie Antoinette was being sarcastic and unconcerned when told that there was no bread for the people to eat. But, considering that cake was more expensive to bake than bread was (at least it was then) maybe the reverse was the truth, maybe she was concerned and saying give them cake to eat rather than let the people go hungry.

[RingoDave]

It is actually an ever-so-slight mistranslation. Rather than cake, she referred to brioche. But that only confirms what you are saying, Cleopatra.

[harry hayes]

Seen no evidence that she actually said that. Still as an avid reader of the Dandy,to the poor, I say "let them eat toast".

 

Happy days

[observer]

I doubt the court of Louis XVI had any finer feelings for the peasants, so the common usage and understanding of "let them eat cake" would seem appropriate, when refering to the two posh boys. So back to Plan A - the question posed was "if the Gov can't borrow, where can they get the money from"? and as if by coincidence, the "rich list" has just been published, showing an increase in the wealth of the top 1,000 Brits to £414billion, which should cover the deficit and leave plenty of change for a tax cut for the Plebs.

[inky pete]

On what planet does £414 million cover a deficit of over £1 trillion?????

[observer]

It's actually £414billion, and the £trillion is personal and private debt not Gov debt. Presumably also, the £414billion includes assets, which could be nationalised and used as colateral for loans, and if suitable land, could be used to provide cheap housing land.

[asperity]

This "wealth" you are so glibly talking about includes all the property held by these "rich" people. So to get the cash required to pay off the deficit all this property would have to be sold - correct? So put all this property on the market, firstly who is going to buy it? Secondly wouldn't the sudden glut of property on the market lead to a catastrophic fall in property value/prices? Time to join the real world Obs :wink:

[Lt Kije]

Asp, I hope you would agree that something has to be done about the growing wealth gap, what would you do?, I don't think anyone on here agrees with the bankers giving themselves lavish pay rises when the banks have not been performing that well.

[asperity]

Well, don't you think a good start would be for our government to stop throwing the wealth of the country at other countries that don't need it, and at the EUSSR, and at the IMF to bail out the doomed Euro? Okay, maybe there are some people in this country who pay themselves more than other people would like, but it is their money, not the governments or yours or mine. :wink:

[inky pete]

It's actually £414billion, and the £trillion is personal and private debt not Gov debt. Presumably also, the £414billion includes assets, which could be nationalised and used as colateral for loans, and if suitable land, could be used to provide cheap housing land.

 

The £1trillion is just the governments debt.

 

http://www.ukpublicspending.co.uk/uk_national_debt

 

which, as you can see, has been increasing steadily since the year 2000, and has doubled since Brown became PM in 2007.

 

And the wealth of the rich is made up largely of investments in businesses - both here and overseas.

 

How are you going to go about impounding overseas businesses? And where are all the rest of us going to work when you've sold of all the assets off the UK ones?

 

The problem is not on the revenue side - it's still on the spending side. Spending needs to be slashed back to the sort of levels we can afford, if we can't afford something then we can't have it!. Just as in 1931 when Labour's Ramsey MacDonald slashed government spending, unemployment benefits were cut, and everyone on the public payroll took a significant, immediate pay cut (not just a freeze, which they all get round with re-grading excercises anyway).

 

The result was a decade in which the economy grew every quarter until the outbreak of war in 1939. World famous UK manufacturers grew to dominate their markets in fields as diverse as cars, machine tools, aviation, textiles and confectionery. We were in a position to reverse the cuts to benefits and public salaries by 1934. Over 2 million new homes were built. The National Grid was built. Unemployment fell from 2.7 million in 1931 (when universal unemployment benefit was first introduced) to well under 1.8 million in 1937.

 

Not such a bad outcome from a determination to live within our means, was it?

[Lt Kije]

Not a good example inky, as we had an empire then which was a closed market, for everyone except the UK, so we could sell with no completion. And they had to buy British.

[inky pete]

Before they could buy British, they had to become rich enough to afford to buy anything at all! British economic policies at the time enabled them to do some of this. But that's pretty irrelevent since our major export markets in the 1930's were in Europe and the US.

 

We had the Empire in the late 1920's too, but that didn't stop government profligacy from dumping us into Depression.

[observer]

Not a good example anyway, as we needed WW2 and a Yankee loan to get out of depression. Funny how money can always be found for a war! btw Ink, not sure we "own all our assets" anymore, don't the French own some of our Water Companies nowadays? I didn't dispute the need to get back to a balanced budget; merely the need (within that long term context) to stimulate growth and get out of spiraling recession - even the Yanks did this with FDRs "new deal", the Germans with a US loan and massive re-armament. The wealth is available, it just requires redistributing.

[Horace]

Taxing the bankers might make us all feel better, me included, but the fact remains there are not enough bankers for it to get us out of the economic mess we are in. It would be a drop in the ocean.

As for the "wealth gap", the way to close it is for the poor to get off their backsides and work harder. If they are not capable of doing that, they have nobody to blame but themselves.

Many of today's monied people have started from pretty humble beginnings and if they can do, so can others.

[observer]

Doesn't work like that Horace: give a million people £1 each and you'll still eventually finish up with one millionaire, no matter how hard folk work.

[wolfie]

I would suggest that when the poor work harder it makes the rich even more wealthy.