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Adam_C_UK

Listed below are comments made by Adam_C_UK between Thursday, 2nd April 2009 and Tuesday, 28th April 2009.

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Reversion to the extreme 11:13am on 28 Apr 2009 This will be my last post on these blogs, sadly. I am cancelling my membership. Thanks to all those who actually wanted to discuss economics. It's been interesting. I'm not really interested in discussions about eugenics, Nazi politics or aggressive posturing though. Bye.
Reversion to the extreme 2:15pm on 27 Apr 2009 Thanks, armagediontimes, for your help. Those of us who believe in ignorance and stupidity must stick together.

Or maybe we could discuss economics. Stephanie says, "There are now no good economic options available to a British chancellor. Indeed, with borrowing at this level, there aren't many options at all." Actually there's a great option. SPEND AND BORROW LESS! (This only occurs to stupid people like us of course.) Even Mr Darling now seems to understand this, though he's proposing to put off most of the cuts until after the general election.
Reversion to the extreme 12:34pm on 27 Apr 2009 #140 JadedJean (and 21 other posts on this board!!!)

I want to thank you for your enormously enlightening posts. Or they would be enlightening, if any of us had a clue what you were talking about. Hint: using big words that most people don't understand doesn't make you look clever. It just makes people ignore you.

And I do hope you'll forgive those of us who believe in liberal democracy (sorry, anarchism of course) and don't understand the amazing power of democratic centralism. Or socialism. Or was that Trotskyism? Or maybe Leninism. Or Maoism. Sorry - I do tend to get confused between all those "isms". Obviously I'm not as clever as you.
Optimistic and steely-eyed 9:20pm on 23 Apr 2009 "The Treasury claims the structural deficit was a mere 2.7% of GDP as recently as 2007-8."

Interesting since at the time they were claiming that they were following the "golden rule" of balancing the budget over the economic cycle, i.e. of having no structural deficit at all.

Of course the true deficits are MUCH higher. All the government's "off balance sheet" borrowing (PFI etc) should be added. So even Darling's appalling figures yesterday were a gross understatement of the awfulness of the situation.

This government has borrowed as much in just two years as all the governments before it for the last thousand years. Please, please will somebody tell Gordon he's out of his depth and needs to go and go now?
In the fine print 10:18am on 23 Apr 2009 The 50% tax rate is a side-show designed to distract attention from the important issues around the budget. As you say, most of the improvement in public finances will come from cuts in public spending. Just three points to make about that:

1. This amounts to an admission by the government that their high-spending of the last decade was in fact unsustainable since it was funded by borrowing, mostly from abroad.

2. If the Chancellor has got his heroically optimistic figures about the recovery at the end of 2009 even slightly wrong, then the measures in this budget will not be nearly enough, and much bigger cuts will be needed.

3. Whatever happened to the goveernment's much-vaunted "fiscal stimulus" and "automatic stabilisers"? Have they really finally realised that this was all nonsense?

Beyond that, the Chancellor was still predicting a £175 billion deficit!!! Astonishing that a budget proposing to borrow so much should be portrayed as a stingy one. This budget is the last hurrah from a failed and discredited government that has all but destroyed our country's finances.
Low risk of deflation 8:05pm on 21 Apr 2009 "The country that doesn't engage in fiscal stimulus, when everyone else is, can free-ride on their efforts, because some of that stimulus will leak overseas."

Explain to me why the government gobbling up additional resources either through taxation or borrowing will stimulate the economy. This nonsense was discredited decades ago. But it's back again, probably because it seems to offer a seductive "quick fix". Magic money, that never needs to be repaid and makes us all richer! How wonderful!

Even the Chancellor seems now to understand this was nonsense - he is now talking about spending cuts. The private sector is hurting, and the government needs to get out of its way. Which means CUTS in spending and HIGHER interest rates. The present course is taking Britain hurtling towards the precipice we almost fell off in the 1970s.
A Conservative Budget 9:05pm on 08 Apr 2009 The truth is that Labour's profligacy, and specifically Gordon Brown's profligacy, has left us in the worst economic situation we've been in since the War. It's all very well to waffle on about "automatic stabilisers". But there's actually no evidence that they help avoid recession.

The government caused this disaster, by keeping interest rates too low for too long, and then ratcheting them up again too suddenly; and by suddenly imposing more severe capital requirements on the banks just as we went into a recession. And those automatic stabilisers (aka lack of control over government finances) played their part too, as did Gordon's shiny new tripartite regulatory system, that blurred responsibilities, took power away from the experts at the Bank of England, and allowed everyone to look the other way while the financial services industry went beserk.

And all the while Gordon was paying lip service to his "golden rule" that governments should only borrow for investment, whilst fiddling the figures to ensure he could direct a tidal wave of new government spending and borrowing into the economy.

The next Conservative government will actually have to increase taxes and cut spending. I believe the people understand that very well, and George is being too timid in not admitting it. What's more, if the Tories cut the right bits of the bloated State, nobody will even notice.
When fiscal stimulus isn't stimulating 10:45am on 08 Apr 2009 Government borrowing does NOT stilumate the economy, especially when the economy is being held back by a credit shortage. Every pound (or Euro) the government borrows is a pound (or Euro) that can't be borrowed by the private sector. The neo-Keynesian nonsense about fiscal stimulus was utterly discredited a long time ago (circa 1980). The Irish are doing exactly what the British did in 1980/81 - which led to a resurgence in the British economy that lasted until Brown wrecked it.

Why is there an assumption that governments should borrow as much as possible, constrained only by the market's tolerance for their borrowing? Borrowing has to be paid back - WITH INTEREST. This can only be justified if the borrowing will itself lead to future profits (as when a company borrows to invest). Even Brown used to pay lip service to this with his now-abandoned "golden rule" on public finance.

The fact that the average Eurozone country owes two-thirds of its annual income is actually deeply depressing and there is no reason for it, other than elected politicians' desire to "give" the electorate goodies without asking them to pay for it immediately in taxes.

A key duty of any government should be to BALANCE THE BUDGET. Which means a lot more than merely not following an unsustainable deficit. Once balance is achieved, the goal thereafter needs to be to shrink the government as much as possible, allowing room for tax cuts.
Making banking boring 8:59pm on 02 Apr 2009 Just watched Lord Mandelson on Channel 4 explaining how the deal means there is now no stigma attached to going to the IMF for a loan. He also said Britain would not be at the front of the queue. Yeah, right. The softening up process has begun.
Final numbers 5:19pm on 02 Apr 2009 Hey! Father Christmas has come early this year. And where was all that money going to come from again?

I wonder why they think that creating new money makes the world produce more things and makes us all really wealthier?

Just like Gordon's UK policy, this is all about making the people who didn't borrow pay for the mistakes of those who did.

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