The £4.8tr debt polemic

Discussion in 'Politics' started by StrictlyAvg, Nov 12, 2010.

  1. StrictlyAvg

    StrictlyAvg Member

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    Last Night's TV: Britain's Trillion Pound Horror Story/Channel 4<br />Misfits/E4<br />Kara Tointon: Don't Call Me Stupid/BBC3 - Reviews, TV & Radio - The Independent

    Britain's Trillion Pound Horror Story - Britain's Trillion Pound Horror Story - Channel 4

    The Martin Durkin program made some interesting points but clearly had an agenda it WASN'T explaining.

    Like how does the UK debt compare to other western countries and their cost of government? This was deftly sidestepped in favour of idolizing the Hong Kong model without explaining any downfalls of the low taxation model adopted there. And how an ageing population in HK (bearing in mind it's only been going for a generation or two) is going to spin out in future generations.

    However the principle that lower taxation encourages more investment and spending and higher taxation just encourages people and corporations to exploit loopholes to avoid paying the tax in the first place is definitely something that needs addressing.

    An older model like the USA has spun out with some glaring anomalies in its own way of addressing social inequalities and rampant corporatism. The point that monopolies (nationalisation) are rarely good for the country is probably true but misses the counter point that corporations tend to grow and merge to create their own versions of monopolies was seriously remiss.

    Will watch with a critical eye to see if he's going to improve his journalistic style
     
  2. B_New End

    B_New End New Member

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    http://en.wikipedia.org/wiki/File:Public_debt_percent_gdp_world_map.PNG

    as you can see, western nations have a little problem.
     
  3. B_nyvin

    B_nyvin New Member

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    I know...devalue the pound! Oh wait, currency wars.
     
  4. B_crackoff

    B_crackoff New Member

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    Gotta agree with the OP.

    The Kara Tointon thing was good though!
     
  5. dandelion

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    i was getting a little annoyed at him. Wanted to keep arguing. How out of character for me. Most obviously, Honk Kong is a tiny place. If you can suck in money from the rest of the world by offering them a discount on their tax and cheap labour, they will come. But if you are Europe or America, it cant work. There is no huge pool of outside cash to suck in. halve the tax rate in the US and thats half government sevices gone. cut wages in half. Thats another half of the tax income gone. States practically out of business. meanwhile, everyone in the country is now on half wages. Are all those companies in europe about to dash off to the US and set up in business? Nope. Still rather go to china where labour is 1/10.
     
  6. Jason

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    I thought the programme overstated its case, and the comparison with Hong Kong was not the best as there are simply too many social and political differences. That said I do think a key point was made that there is a correlation between low taxes / small state and prosperity, and the UK state sector at over 50% is simply too big.

    Labour are criticising the Coalition's policies including the effort to cut the state sector on the basis that:
    a) it risks a double dip recession
    b) there aren't any jobs out there (so we should keep people employed by the state).
    Lets say we avoid (a) - which does now seem the most likely scenario. And lets say that the Coalition are on the right tracks in their view that 1m jobs will be lost and 2m created, ie 1m new jobs. Take 1m off our present unemployment level and it would actually be rather low. Take 2m off and we would be approaching full employment.

    It is nowhere near as dramatic as Hong Kong or an Asian economy, but it is a trend in the same direction.
     
  7. dandelion

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    I liked the bathtub model. That I agree with. The actual cuts by the conservatives or the proposed cuts by labour are both a drop in the ocean. Both relied on growth to solve the problem. The cuts are not stunningly huge. Whether they are right or wrong i really dont know. (though long term, I think balancing the budget is necessary)

    I cant agree jason. Unemployment has been rising steadily, though the headline figure is only a part of the real not-ecconomically-active. Ther is no labour shortage in this country, which could be fixed by sacking civil servants. In fact, there have just been a lot of calls for the long term unemployed to be given make-work jobs to keep them busy.

    That doesnt mean there isnt plenty of waste in government just as there is in industry. The difficulty always is to work out which bit is waste and which is really keeping the whole show going.
     
  8. D_Scotty Bagpipe

    D_Scotty Bagpipe Account Disabled

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    Durkin does have a habit of making documentaries that take an extreme or contrarian approach to mainstream media political agenda (climate change, etc). Whilst there were a few errors, i think it is excellent that a credible TV channel airs a documentary in primetime in order to counter the total hysteria that is being generated by specific interest groups regarding cutting government spending.

    If the numbers on frontline services stack up then I think it's pretty interesting to see what the opposition's arguments will be. Also, I think it's vital to properly the mechanism of selling gilts, or national debt in order to pay for services, rather than taking steps to boost enterprise (slashing corporation tax is an excellent method; it doesn't make a huge contribution to the revenue. income tax forms the majority of tax collected) and reaping the tax benefit of doing so.

    The comparison to HK was flawed; but illustrates 'another' way, which is important for the majority of people giving them a concrete concept and example to visualise. On labour costs; it's true that we cannot compete with certain countries or regions within those countries but the UK and more generally Europe have countries like Romania, Bulgaria, Turkey and the Balkans (social and economic issues notwithstanding) to look to for future opportunity - Greece, Spain, Ireland shouldn't happen again but probably will because the 'money' from QE2 creates more bubbles.

    Anyway; I think it was pretty good on the level that it states a counter argument to the anti-cuts lets be hysterical and strike brigade and all those guardianistas out there.
     
  9. dandelion

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    so how does slashing corporation tax help? it means shareholders get bigger dividends, share price goes up and directors get bonuses. Did that help anyone else?
     
  10. D_Scotty Bagpipe

    D_Scotty Bagpipe Account Disabled

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    it helps everyone else because it encourages people to take risks by starting up companies and investing in business in a particular country. it does this by reducing the cost of doing business - why bother putting in the effort if the government takes your money away through punitive taxation? there's no incentive. the knock on effect is that when people start businesses they create jobs, spillover; first there's money to buy goods and services from other businesses and second, more jobs means more income tax can be collected which is good for budget deficits; and here is the beautiful thing - it's private enterprise that does this.

    and a slight aside, on shareholders getting bigger dividends - why is that a problem? do you have a pension? or know anyone that draws on a pension? because it's those dividend payments which help pay for those pensions which are actually in rather a lot of bother at the moment and again; if you're taking the risk to invest in a company; you should be rewarded. without incentives people simply wouldn't invest or even save.
     
  11. dandelion

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    Explain to me why it does not work the other way around. The more gets taken away from you, the harder you have to work to try to get more. The more you have, the less you have to work at all.

    This is rich people who do not want to have to work who therefore want to just hang on to what they have already got. I have nothing against people hanging on to what they have, but I have an issue with them sitting in their deck chairs just getting richer and richer and richer.

    Why does no one argue that if you double unemployment benefits it will make the unemployed work harder to try to get jobs?

    Businesses typically work on tiny margins. Why do they bother trading for .5% profit?......because .5%xBig number=lots of money.
     
    #11 dandelion, Nov 13, 2010
    Last edited: Nov 13, 2010
  12. D_Scotty Bagpipe

    D_Scotty Bagpipe Account Disabled

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    *holds head in hands*
     
  13. Speculator

    Speculator New Member

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    The countries that have more debt than us are all fucked up, nations such as Ireland aren't exactly role models for good governance. Is it the left's dream to aspire to the dizzying heights of Ireland and physically run out of cash by the middle next year?
     
    #13 Speculator, Nov 13, 2010
    Last edited: Nov 13, 2010
  14. D_Scotty Bagpipe

    D_Scotty Bagpipe Account Disabled

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    Yes is your answer. A dream for people that don't care to understand the fundamentals of economics and crucially, capital markets. But which average person is really going to take that time?
     
  15. B_New End

    B_New End New Member

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    What about those that understand better than you, and still know it's all bankster bullshit?

    And what about those that understand, we can just take everything from the rich, because we vastly outnumber them, and throw them to the bottom of the sea, and divide amongst ourselves what they have been stealing for decades through central banking?

    I wonder if the rich understand the laws of realpolitik. they sure as hell seem to have no clue. But then again, clueless aristocracies are not anything new. And neither are bloody revolutions. See the correlation?
     
    #15 B_New End, Nov 13, 2010
    Last edited: Nov 13, 2010
  16. D_Scotty Bagpipe

    D_Scotty Bagpipe Account Disabled

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    You trashed your own point on realpolitik I think; I was just answering Speculator's question in relation to Ireland.
     
  17. Speculator

    Speculator New Member

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    What the fuck are you talking about?
     
  18. B_New End

    B_New End New Member

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    ahh, another clueless aristocrat.

    Please, come outside, we have a ride for you.

    rest your head right there... you might feel a slight sting on the back of your neck.

    :rolleyes:
     
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