91Èȱ¬

CRUX

"if you want to know if the Government's big gamble will pay off"

Surely that's the point isn't it? With a GAMBLE you cannot know. So the political posturing and brawling is just so much wasted time, effort and - yes - MONEY.

In such a complex world, there is no room for the Westminster charade. We need dedicated, mature, management not juvenile capers.

SPOIL PARTY GAMES

So much for helping business!
Darling has learnt sleight of hand from the master Brown!

VAT on petrol & diesel used for business purposes can be reclaimed, so a VAT reduction means nothing.

However, extra fuel duty CANNOT be reclaimed. ..so struggling businesses will suffer more.....and if they do manage to survive through next year and VAT goes back up.....will fuel duty be reduced?..

Then business can look forward to the extra 1/2% employers N.I. which will clobber them again.

Welcome to the team Peter!

As some of my "regular readers" know I am now back in work from retirement to pay for some of the increases/cuts we have had to endure as a family. So sorties into these comments will be as and when I can find time.

As a Labour member I should be pleased that Darling is doing something more than the Tories who are just crying "We are Doomed Capt. Mainwaring".

However, moving from a party stance his hope that I will spend as a result in my case will not happen. As I suspect many others will too, I am spending 2009 reducing my debts and trying to get back, probably by 2010, of spending "real" money. As I have blogged before ( and many of you too) the problem has been caused by Banks, Governments and US (we) "reaping where we have not Sown" as the Bible states.

So my heart hopes he has his sums right but my head tells me he has as much chance in getting people to spend as I have winning the Lottery.

This debate will run and run with, as I have written before more people blogging telling us what should be really done. I bow to their superior knowledge!!!!???

I do like his taxing the rich but the big hammer will be the half % increase in National Insurance. That will blow a big hole in some salaries.

Look forward to reading your responses to the programme before I go to work. It will be full of "sound and fury" signifying nothing with the "politicians" point scoring whilst we all try to get our heads aroung what has been done and the consequences.

Spend! Save! What to do? What to do?
If the government are serious about this budget they have gone beyond George Orwell and started on Lewis Carrol. Am I really stupid, or is the raising of National Insurance and tax on fuel merely canceling out any meagre benefits from the other smoke and mirrors measures? The financial sector caused the problem let 'THEM' pay to fix it!
Sean (still socialist less smug and more depressed).

The whole point of today's announcement, as I understood it, was to stimulate the economy. While any effective action is welcome, I just struggle to see how the reduction in VAT is going to make any practical difference. If you are struggling to afford something at, say £120, I really don't see how a couple of quid is going to make much of a difference.

I also noted the 50p that I am going to be contributing to every £1 of savings of the 8 million least well off. I'm sorry if this sounds selfish, as I really don't mind helping out people who need that help through no fault of their own. But to be blunt about it, I really don't see how it's my problem if someone can't afford to save. I can barely afford to save myself!

One medium term result of this extra borrowing announced today is inevitably going to be higher taxes. Another should be taking an axe to some of this government's pet social engineering polices. They were bad enough when we could afford them, but now we simply can't.

Really Darling...If we have no spare cash, what help is a VAT reduction? Surley a large increase in personal tax allowance would have been better? Would anybody be tempted to make a purchase because of a 2.5% price decrease? (75p of a 30 quid sweater!!!!) Give me 30 quid extra in my pay packet and I'll spend it on something!
Will somebody please listen to that Vince Cable, he seems to be the only one who knows what's happening in the real world.

A TAX ON BUSINESS. Pointed out by No2
the extra duty cannot be claimed back and will increase transport costs for ALL business including the food industry and retailers so this is a tax ON business and this will overide many times the reduction in VAT.
No commentators have seemed to pick up on this very very important increase to business costs.

talk about babtism of fire, Peter, 91Èȱ¬ 2 has just made me throw the duvet over my head with it's alarming programme on American debt which makes ours look like a shopping list for Tesco, still we are second debtor nation in the world and guess who is third, Euroland so we are debtor nations, no self-respect, no honour and certainly no prospects. Be honest, would you want to model your economy on our example with our trillions of debt, The EU, the UK and the USA. How those chickens have finally come home to roost......feel sorry for our grandkids...

What a complete and utter condemnation of 10 years of Gordon Brown as Chancellor .....

There should now be a wholesale clearout of the Ministers responsible .......

Fire Balls. Fire Cooper. Send Brown to The Falklands. Promote Angela Eagle as the new Chancellor. Darling as interim PM.

War economy finance? Who is Labour
kidding! Crass fiscal irresponsibility to
buy votes to bribe their way to power.

And now Britain has to pay the price -
but mainly after the next election after
they cheat their way to a fourth term?

As George Osborne says: Labour have
done it again! Brought Britain almost to
the point of bankruptcy - at which point
they suddenly pretend to be 'socialists'!

"67. Two central principles will guide our approach. First, meeting the golden rule for borrowing. Over the economic cycle, the government will only borrow to finance public investment and not to fund public consumption.

68. Second, alongside this golden rule commitment, we will keep the ratio of government debt to GDP stable on average over the economic cycle and at a prudent and sensible level.

69. This platform of fiscal stability will deliver, more investment, more growth and more jobs. "


Chancellor's Speech to the Mansion House
12 June 1997

The footsie might like it and the greedy unopposed banking sector, but comments from the public and small business are pessimistic. In fact let's not mince words. Normal mortals have neither faith nor confidence in this disgraceful shower intent on ruining the country. All this government can think about is borrowing! Oh and stealth tax in conjunction with record regulation. They have created a massive welfare dependent culture and an immigrants free for all costing billions. Greed and expenditure is out of control. Companies have moved abroad. British industry and manufacturing is all but gone. Many are at struggling, while some are at liberty to rip us off. Higher rate national insurance and tax will effect middle England as usual, and the time delay will come in handy for everyone to plan their off shore exit. Speaking as a company director - we do not need to borrow or spread our tax bill, but we are not replacing vehicles or buying into services. My personal opinion is, they failed to do the one simple thing to make a great difference across the board, by lowering fuel tax and attacking vast profits. The less well off would find it easier to heat and eat. Lower pump prices with supermarket and the high street impelled to pass on the savings or face fines would help the economy and the morale of the country, shareholders would still win but by the upturn rather than by confiscating the savings, as the banks hoped to do.

It would appear that Panda has shot himself in the foot with the increase in fuel duty to compensate for the cut in Vat. I suspect that most VAT is on items priced so low that retailers will have no option but to pocket the difference, after all, everything is priced a something 99p. If the increase in fuel duty is passed through the chain everything in the shops will be more expensive anyway.

As for the token 45% tax on over 150k, perhaps it would have been better to make it a flat 50% on all earnings over 50k. People must be pretty feckless if they can't make ends meet on 1000 quid per week they deserve to pay extra tax. After all it was they who created to housing bubble with ten bob fat cat schemes like buy to let. All tax relief to benefit those who pay private tax to the stock market parasites should be thrown in the bin also. The economic situation can never improve before we get rid of all the false money generated over the past 20 years.

There seems to be very poor analysis of the budget over all news platforms.

#2 Not so silent majority brought up the 0.5% increase in NI for employers. Other news is an overall increase employees and employers.

Therefore a business which is a limited company has to pay both increases. Anyone know the correct score on this.

Agree on the vat nonsense for business, it appears not to matter for those vat reg.

What on earth was the dumbing down on ITN news. Juliet Bremner spent 5 minutes explaining what a 2.5% reduction meant.

On a £300 TV £7.50 with a little graphics card. On a £100 ipod £2.50, with a little graphics card etc etc until a £10 CD, 25p.

NB ITN, people who cannot take 2.5% off a figure do not watch the news, spare the rest of us.

Neil. Paul Ormerod was advising the Labour Party 95/96. I had high hopes, he was one of the few economists I could read.



Then for some reason he stopped. I felt the writing was on the wall in 97, just because Labour didn't seem to be taking his work on board. I have only read The Death of Economics.

At least what we were discussing last week in the blogs re vehicle excise duty seems to have been partly taken on board.

Friends of the Earth don't like it, but that just shows they don't understand life cycle analysis and the bigger picture.

There must be a better way of running a country or a planet than what we have.

I'm going to build a time machine, go to the future, to a alternative reality that worked, Find out how it was done. Then come back with the answers to be implemented now to get there. Simple.

Celtic Lion

Most people seem to have missed the point about the VAT cut. Whilst it is a small amount per item, unlikely to affect particular purchase decisions, it leaves about £12bn in circulation. That is about 1% of GDP. Now if the economy is set to decline by 1 or 2 % £12bn is a significant stimulus, as long as people spend it and do not selfishly save it or use it to pay off bank debts (which immediately takes it back out of circulation and so creates demand deficient unemployment).

Peter

welcome to the bouncy castle.

peters wisdom

'There’s an old adage in TV that the key to good storytelling is to simplify and exaggerate.'

'In radio there is an apocryphal story about the seasoned old hack who when asked to cut a crafted minute long despatch to 40 seconds responded. “My dear chap, I can do the Second World War in 40 seconds if you like, but you might lose a bit of detail.�

Do Newsnight editors have to be called Peter?

Welcome, Peter!

I am yet to meet someone who thinks that this VAT cut will make much difference. If one spends, say, £1000 over Christmas, one will save... £20!

Surely with the amount that will be lost through the loss in revenue from items would buy anyway, VAT cut or not, will outweigh any potential gain. It is actually quite clever to set it off against an increase in petrol duty, but this cut is essentially psychological and I don't know if the mind games will work?

I'm with Vince Cable. An income tax cut for most people, funded through savings, closing tax loopholes on the super rich and borrowing would be much more effective.

Anyway, got to go and make my shopping list for Monday and work out how much I have saved...

funny how the govt is in a rush with everything except a feed in tariff that has proven to create 100,000s of jobs. i see in the telegraph that one might be brought in sometime at the end of next year [no details] just in time for an election to delay it?

also that the 'heritage industry' ie the people with pictures of the haywain hardwired into their imagination as the only model of the good, are ready to block anyone who has the bad taste to put windmills or solar panels on their house.

apparently to them heritage role gamers a house can have a chimney belching out gas [because it fits the haywain picture in their heads] but not a windmill or panels. unless the windmill only grinds cereals of course and its owner wears a smock and tights.

but back to the budget. tax fiddling only moves money about it doesn't create any new money and debt takes money out of the economy in the long run.

jobs in industry with growth potential creates wealth. they could have brought the feed in tariff forward. but then nuclear and heritage people wouldn't like that this side of an election?

So it is an increase in NI for employers and employees. So limited companies will have higher costs.

ITN have now changed all their vat reduction figures. They hadn't worked them out correctly at dinner time. They just took 2.5% off the present total price. Not taking the original less vat price and adding the new 15%. So the reductions are less than they indicated earlier in the day. Juliet had new graphics and a new voice over.

The one thing I could see coming was businesses have to reprice all their stock if retail. etc etc. More work for small retail businesses.

Celtic Lion

It still appears that those retired people between 60 and 64 who have small pensions are still missing out on the loss of the 10p band compared to to the middle incomes as the allowances are across the board. The £60 supplement does not apply to those pensioners under 65.

Peter

a newsnight analogy video.



a meet the blog posters video

The point everyone is missing on the VAT decrease is that all the retailers will simply put their prices up and absorb the VAT to build a slightly larger margin. I've (reluctantly) working in Pricing departments before and I know the mindset. It's naive to think they'll pass on the savings to consumers. Lots of 'rounding up' will happen.

The benefit will be for the likes of Tescos and their shareholders and not to the general public. The cash will leak straight out of the UK economy into the countries where all the big retailers are based, for tax reasons.

Why does Jeremy Paxman always allow Yvette Cooper not to tell the truth every time she comes on.

Yes I have written in to Newsnight, but as we discussed last week they never reply.

The Government knew in 2001 there would be a recession if they carried on the present development trajectory.

They were given £50 billion per year ie £350 billion to date, they declined. Yvette Cooper wrote too me last year about this. She put the responsibility on the National Audit Office.



Yet again she tells the British public it was all unpredictable. It wasn't the Government and she knew about it. Why doesn't Newsnight make politicians tell the truth. Isn't that what we expect you to do as we pay the licence. Why is Newsnight hiding Government incompetence, you should be independent and not their PR company.

Why does Newsnight continually allow Ministers to knowingly mislead the public on important issues such as this.

Celtic Lion

#14

Yes, but it is 2.13%, not 2.5%. That is a little more difficult.

Perhaps Juliet had been listening to Robert Peston, who eventually gave up (pre pre budget 91Èȱ¬ 24).

How does a gambler know if his horse is going to win?
What we do know is that Fuel and heating prices have gone up and that we will all receive much higher bills for the foreseeable future.
So instead of 2.5% off of Vat on goods the abolition of the 5% vat on gas and electricity would have been a lot more beneficial and would have helped a lot of people and business's,
Also we know that despite a reduction in some taxes Council taxes will increase next year.
So how about a freeze on these to convince us that the actions of the 24th November wont just be swallowed up in the new year.

Under these circumstances who in their right mind would go on a spending spree because of a 2.5% cut in Vat.

A question for the Chancellor - why does he have to do something right now?
The reactions are like those of a mangement who only have half the months salary money and who have decided to gamble it on a set accumulated bets.
They have worked out all the odds beautifully but haven't worked out the probability of success or failure.
WHO WANTS TO WORK FOR A MANAGEMENT LIKE THAT?

a

'The Panel' - do they ever say anything substantive? It all striikes me as just luftgebaude. Isn't that precisely what's at the root of so many of our recent woes? The three of them invariably strike me as three gossiping old 'fish-wives'.

Seriously, 'The Panel' might be more at home on Newsnight Review, perhaps discussing the merits of vacuous productions like 'Future Leaders'? You could have Yvette Cooper and her husband on too.

It was good that you closed with some sense - i.e. Paul Mason's appraisal.

It seems to me this blog is too clever by half, too cynical, too jaundiced, possibly over educated with learned scepticism.

"For we are all like swimmers in the sea, poised on top of a huge wave of fate, which hangs uncertain to which side to fall. Whether it will roll us out to sea, or whether it will heave us onto shore, we know not, and no search can make us know. Only the event can teach us in its hour!"

Like any war, we the foot soldiers, have heard the 'orders', know what is to be done, and must hope our Leaders have got it correct; not like 93years past - lions led by donkeys. But we must now get on with it - must support our Nation and our Government, in order to achieve the best for all of us, our children, our friends, our dependants, our Companies. In the words of Cameron's Eton boating song, (or some such), "we'll all pull together"; if we don't pull together, if don't hold (hang) together - we'll hang separately. Do as we must to win! Vote as you choose when the time comes!

@15 :

"as long as people spend it and do not selfishly save it or use it to pay off bank debts "

key words: "selfishly save" ..WHAT!!!!!!!!!!!

well i never thought i'd see them two words together. i think you will find we are in this mess because we did not save and was encouraged to spend spend spend and get into debt...and this Govts response is to put us all on the never-never and nicely timed for the future Tory Govt to inherit. Labours not just clueless but reckless and nasty too....Darling/Brown has created a fiscal scorched earth policy.

Chatting with a chum last night who works with a small sME, and he mentioned a minor, but significant point.

The reduction in VAT is so insignificant, and proposed for such a short period, it is going to cost his company a small fortune to make all the necessary logistical changes (systems, reprinting, etc). And then, of course, all back again.

I don't profess to understand the details of how this tax is imposed and collected, etc, but their initial thought, which I hope (for them) is legal, is to keep things as is, make a note of the differential and credit back when things get back to 'normal'.

Mind you, as noted, in a world gone slightly mad where the phrase 'selfishly save' is coined, I guess anything is possible.

There has to be something seriously wrong when those playing with our futures (and, often, reporting upon them based on little more than press release) in this manner can do so secure in the knowledge that pay and pensions are secure no matter what.

So long, of course, as a few still have foolishly made, selfishly saved and yet feel generously disposed to fund them further.

My Personal Views -

Debtors Prison UK

Paul said last night that the Government debt would be in balance by 2015-2016.

Did he mean the Government thinks it's debt (excluding PFI and public sector pension liabilities) will have fallen below 40% of GDP again (pre crash levels) ?

Spin and Question Avoidance

The Chancellor does not seem to be willing to admit to the £1 trillion debt they are racking up, £34,000 per household in the country, maybe a job for Mr Paxman ?

How much tax per year does it take to service (interest repayments) the Governments debt ?

How many schools and hospitals is it worth ?

When will the Recession End?

So how can we measure the effectiveness of this Economic Package ?

Six weeks ago I heard a Independent Economist say the Recession will end in the first or second quarter of 2010, with unemployment growing to just under 3 million.

What does the Government say their action plan will produce ?


Should there be a Pre-Budget debate in the House of Commons ?

I think YES , Mr Osborne had Labour on the ropes yesterday, Mr Brown face was flushed red with embarrassment, not quite worth £34,000 for the pleasure , so I would like to see some more !

AN APPEAL ON BEHALF OF RATIONALITY

I am having a bit of a hard time with the talk of 'a downturn'. I have an uneasy feeling this is the new 'Bird Flu', 'Global Warming', 'War of Terror' politics of fear and would like to be told why this view is without merit.

Up until recently we had 65 months of continuous growth with a yearly average of 2.5%. As growth is calculated relative to the last quarter and last year, 0.5% growth would still be growth, 0% would mean the same as last year/quarter and even a 2% contraction next year would mean setting the countrry back about a year, with 5% a couple of years surely?

Given that so much growth was fuelled by irresponsible, 'fantastic' financial services 'products' where almost zero-collateralised loans were made because bonuses were awarded on sales alone, as I see it, a contraction was absolutely inevitable and the cuttting of financial services is essential. Yet cuts in interest rates and pressure on banks to lend to 'small businesses' (which could (theoretically be property speculators or stock market gamblers) is still being 'strongly encouraged' by government.

On whose behalf?

My concern is that there are vocifierous lobbyists out there who want a return to what caused these problems. They don't care about anything other than making a fast Buck, Euro or Pound.

Surely the statistics to focus upon are 65 quarters of continuous growth with an average annual growth of 2.5%? WHat is a 2% contraction in that context? What would a 10% contraction be in from perspective? Why has the FTSE dropped over 2000 points in recent times?

The VAT changes announced yesterday by the government will actually result in many small businesses being worse off, not better.

Thousands of small businesses on the VAT flat rate scheme (FRS) pay a fixed rate of VAT to the Inland Revenue. In many cases, these rates have not dropped by the full 2.5% reduction and result in small businesses being worse off. This is the opposite of what the government says it’s trying to do.

For example, an innovative business in the IT sector has a handful of employees - before 1st December they charged customers 17.5% and paid the Inland Revenue 13% on the flat rate scheme. This was a 4.5% saving that helped the service industry compete with low cost competition from countries such as India. After 1st December the same company will charge customers 15% and pay the Inland Revenue 11.5%. The saving is now 3.5%. This is actually reduction of 1% at a time that the government is saying that it’s helping small businesses.

ANOTHER FINE MESS

Underground Nick @28 writes: "It seems to me this blog is too clever by half, too cynical, too jaundiced, possibly over educated with learned scepticism."

Just how long have you been underground Nick? Admittedly, all the things you cite (and more) are exhibited on here, but with Westminster and the 91Èȱ¬ comprised, and functioning, as they are, small wonder!
Conveniently, the post of Celtic Lion tells all: That the 91Èȱ¬ incessantly interviews Yvette Cooper (epitome of vacuous, devious, voter-contemptuous, high office) should tell you that we, the public, come a very poor third.

In passing, every time I cocked-up a multi-part mix in my business, I had to apply percentages to correct it. The 'VAT truth' stated at 28, above, was instantly apparent to me.
However, given the bizarre nature of the 10p fiasco, did Darling/Brown realise? (I have to, seriously, doubt that Yvette Cooper noticed.) OR ARE THEY JUST STUPID AND ARROGANT? (Newsnight, please ask.)

In summary: Westminster is a select club of political game-players, the 91Èȱ¬ is art and theatre, with the outside world just a theme for 'variations'. And I am as close to realistic as a deferred suicide can get.

It could all be very different, but while we live within the lie' (Havel) decline is inevitable.

cooper seems more interested in dissing the tories. which is where labour are at. its a political budget not an economic one. an election budget.

which is why they have ignored wealth creation through new jobs like vince's housing for the poor or the feed in tariff that has been kicked into the long grass to 'maybe' at the end of next year [ie election time]. they don't want it to work. its not in their electoral interest.

the panel talked about which economic policy would 'look better'. Nothing about if its the right thing to do.

as for action versus inaction. gordon had inaction for 10 years. gordon has inaction on wealth creation through industry with growth potential, gordon had inaction on financial regulation, inaction on debt, inaction on housing bubble -a history of inaction. now this action to 6 years of debt is worse than the previous inaction.

its not a glorious day. this 'day of action'.

undergroundnick (#28) "It seems to me this blog is too clever by half, too cynical, too jaundiced, possibly over educated with learned scepticism."

An appeal for more dysgenesis eh? We don't need none of that clever alek stuff around here? We need to pull together and do as we're told by our great leaders?

Except this is a Liberal (free-market) democracy which means that our great leaders don't/can't do very much except spin. They devolved/abrogated leadership to mysterious 'market forces' (and the BoE) long ago. Leadership is what they DON'T do. What New Labour will do now is burden the country with more debt so the Conservatives don't get much of a look in at the next election, after all, the latter pledge to cut taxes AND be hands off too and they don't want another party in office as thgat means they won't be.

New Labour are International Socialists, and to make their dream come true they have to break the UK up and put it piece-meal as Regional Assemblies into Europe. The'll do anything to faciliate this.

"In classical capitalism, what has been called the "night-watchman" state, government's role in the economy is simply to prevent force or fraud from disrupting the autonomous operation of the free market. The market is trusted to provide."


Robert Locke
Sept 2002

#34 Barrie

I have apologise I did get seduced by Juliet Bremner on vat. I knew it was wrong at one level, but it was on TV so it must have been right.

Only when I thought for myself #14 post post did the penny drop.

What it appears more importantly is neither ITN or #24 13th man Peston can do basic maths.

This is going to be a problem when the vat does come down, as people are going to be looking for 2.5% price cuts.

Apologies to anyone who can do basic maths, but it appears even the media need basic skills. Here is a Newsnight resource.

What will a pound shop have to rename itself with a 2.5% reduction in vat.

The item on the shelf costs £1 including 17.5% vat, added on to its original none vat price.

The easiest way is to look at it is the total price is original price 100/ hundredths plus vat 17.5/ hundredths= 117.5/ hundredths.

The original cost is £1.00 divided by 117.5 then times by 100 to give the non vat price.

0.8510p

plus the new Vat rate at 15%, times 15 divided by 100

0.1276p

add to the original non vat price

0.9786

rounded up to the nearest.

The shop will be called the 98 pence shop, not the 97.5 pence shop as the media have struggled to explain..

Now

"24. At 11:48pm on 24 Nov 2008, 13thMan wrote:
#14

Yes, but it is 2.13%, not 2.5%. That is a little more difficult. "

add 97.86 plus 2.13 equal 99.99 or

£1.00

QED

At 2.5% reduction in the vat rate is a 2.13% reduction on the retail price.

Celtic Lion

What am I missing? 2.5% off VAT will make little difference to consumer, it is a worthless as a fiscal stimulus. By triggering a (minor) generalised fall in prices from 1/12/08 however, CPI will be effected quickly. BOE will be forced to drop its near-mid term CPI projections and drop interest rates sooner and harder than otherwise. In the current climate, it can focus on the next 13 monhs rather than the usual "2 year" view when this VAT change will be reversed.

HMG gets to force BOE's hand in the way that it wants (and BOE probably wants too) without anyone having to mess around with its mandate or terms of reference - a difficult can of worms to open at the moment.

Gordon Brown promised a fiscal stimulus and he delivered it; albeit at a relatively low level, just enough to make enough waves to show he is serious. Moreover the City liked it, and the pound held its value, so its initial job has been done. Now Brown will have to get the other members of the G20 to follow suit; since he is right in claiming that a joint effort will be much more effective that the UK alone.

But I suspect that he had two other objectives. The first of these was just as important. Surprisingly it was to announce the tax rises, probably the first time a Chancellor as ‘boasted’ about these. The economic actors, be they financiers or brokers of currency dealers, look for a predictable future so that they can take rational decisions. They would disbelieve ‘good news’, but will happily bank on the bad news. Amazingly, if you don’t realise the background, Darling gave them three years of bad news, though not so bad that the UK could not afford the figures. So they can now happily plan for a secure future; exactly what is needed to calm markets in a recessionary panic. Medicine works much better if it tastes nasty.

Both of these objectives are largely economic, and Keynesian (the new orthodoxy after more than three decades of monetarism) in hue. The third objective is inevitably political. After a year in the dog house, Labour has at last found a possible way to win the next election. In the first instance global circumstances have reshaped the political playing field. Brown is now playing a home game on territory where he feels most comfortable. In addition, he is backed globally by almost all the G20 players; where Cameron has almost nobody on his side. The odds have reversed.

If that wasn’t enough, the fiscal stimulus is also, for the first time in more than a quarter of a century, progressive. Accordingly, when it comes to the election will the Tories, who have foolishly reverted to (Thatcherite) type, want to reverse the progressive elements. But will they also want to take the money away from the poor and from the old. Will they even want to reduce the 45% tax on the super rich; when the big cats in the financial sector (who represent a sizeable proportion of those affected) are the villains who got us into this mess? What, in any case, will the electorate think of such a move, rewarding the ‘guilty’. On the other hand, if the Tories don’t reverse the tax how will they explain this shift to their right-wing supporters?

well, that's what happens if you stick economics under the category of (social) science and then reward economists for being scientific. sack the economists and let the teachers and nurses run the country instead and then we'd all be able read, cook and look after ourselves in emergencies

let's face it, we are trapped in a global situation that will ultimately create a new developing world in the west, capitalists are not fussy about who the poor are and it seems to be our turn, resourceless things that we are, we've given away all our money-making ideas and now we're broke, aich, Adam, where did it go so wrong?

oh well, back to the factory

i once watched a young boy in India making photo frames in a tin shack so i'm not crying about my debt yet, plenty further down the economic ladder to fall and i'm good at making shacks although i may opt for a tipi just to be pretentious

the main thing is to keep to our morals - NO child labour! women and children first! we may be poor but we're respectable!

incidently - might it not be a good idea to look at wage differentials - the Mondragon coop in Spain used to (don't know if it still does) keep a max 10X from top to bottom. in our economy the highest rate tax starts at that point! i would be in favour of slashing all salaries over 150K, you don't need anymore money than that anyway and don't give me any free market baloney, the free market has failed, that's what all this is about

for every person doing a job over 150k there are several more people who could do that job, it's not that they aren't capable it's just that there aren't enough good jobs for everyone so the salary actually represents payment for more than one person, in societal terms,

plus shouldn't economists be putting their minds to how to make a society work without shopping, i mean we can't shop for ever can we?

i tell you it is a great relief to me not to feel that i need to spend 20 minutes choosing which air freshener suits me best, (spice is nice but citrus says Wow, a candle looks so attractive but it's messier than a wick...hmmm?), i can just reach for the cheapest and my house smells of 1950, it's great - (calling out of the door) tea's ready pa!

maybe catherine zeta could sing us a song or two to brighten our mood?

#28 undergroundnick

Well I read you comment when it came up. I knew others would reply, and they did.

You seem to like the word 'we'. Well 'we' haven't had a Newsnight joke for a few days.


The Lone Ranger and Tonto are surrounded by a 100 rampaging Indians.

The Lone Ranger again fires his gun. Click- he has run out of ammunition.

He turns to Tonto and says
"Well Tonto we have had a good life together. We have had many adventures together, we have had good times together. We have been good friends in life and now we will die together.

Tonto turns to the Lone Ranger.

What's this 'we'... Paleface.

Celtic Lion

PHRASE OF THE DAY (#39)

"What, in any case, will the electorate think . . .?"

They will think what they are MOST POWERFULLY led to think - worse, they will BELIEVE IT. This is why elections cost many millions of pounds; not to present the truth, but to dupe the electorate - well, the tiny-but-vital residue that now puts the 'mock' in democracy.

The dumber the electorate, the more they can be led by the nose. Money and Machiavelli do the rest. And that is true for any party that bows to the dishonourable Westminster ethos.

The fiscal stimulus won't have much effect in my world and whether it is informal or formal the government will have to address the problems more precisely next year.

Referring to the "Global credit crunch" does not identify what went wrong and how you fix it. Once they do address the problems their responsibility will be exposed and they will suffer damage politically.

But then I think a fiscal stimulus could have effect as it would be credible and this may give them a boost. Will we be able to afford a large enough fiscal stimulus then (why did we blow away money on this one).

The public may appreciate the belated show of integrity.


#36 Jaded_jean

"Except this is a Liberal (free-market) democracy" - you are always always so astute.

No its not a 30's style planned economy like Hitler and Mussolini. Outstanding.

I bet you do mental exercises to boost your IQ.

It has many of those "politically correct anti-fascists" doesn't it. Also Jews. Racial and political diversity. They are "peddling the merits of 'freedom'".

41. At 4:33pm on 25 Nov 2008, KingCelticLion

Thanks I needed that. Too often these days 'I' am told what 'I' am thinking / wanting / demanding / voting for / mandating / telling 'them' (need to come back to that one), when 'I' have no recollection of doing any such thing. Yet it is trotted out by pols, accepted as fact (or, worse, promoted as such) by pliant media and, of late, seeded a tad too often for my tastes by mystery bloggers who appear as quickly as they vanish in some threads I find are... 'interesting', but some it seems find 'too interesting'.

36. At 12:11pm on 25 Nov 2008, JadedJean

That said, I was a bit torn on some aspects of this critique: undergroundnick (#28) "It seems to me this blog is too clever by half..."

Whilst I have to fully endorse the sentiment in the second half of your comment, the first half was indeed too clever and I had to Google 'dysgenesis'. I remain, sadly, stumped.

Meanwhile, back at our superheroes' latest triumph, I feel a bit like the guys in Tremors, still trying to figure out if they are alive or not as monster goo continues to rain down post explosion.

39. At 3:44pm on 25 Nov 2008, mercerdavids
Gordon Brown promised a fiscal stimulus and he delivered it; albeit at a relatively low level, just enough to make enough waves to show he is serious. Moreover the City liked it, and the pound held its value, so its initial job has been done.

I merely ask, as I don't know, but I have heard this shared elsewhere in such terms. But I have also heard that it was near zippy to do with the latest wheeze and more to do with such as the CitiGroup support in the US. And have to say that this notion has some credibility as it was pointed out that the same effects were noted in other countries' markets not affected by the dynamic duo's latest throw of the dice with my kids' futures.

As I am less than impressed with the chances of getting anything objective from my national broadcast news outlet and its various 'interpretations' of 'events', I was wondering if any experts out there might have the facts, supported by links, just so's I can have a stab at figuring out where 'we', or at least 'I' and my family (index linking seems to place many public body employees in a different category these days) actually are.

WHERE WE ARE (#44)

We are third planet out from a star that has the ability to squirt us with high energy plasma on a whim. We share variable electro-magnetic connectivity with it. Our planet passes through space debris (meteors) of varying size and 'potential' most months of the year. The planet, itself, is subject to volcanism and climatic change, and magnetic field reversals. The fossil record shows major life-extinctions. Add to that: we are a 'failed ape' who chooses inept, unstable leaders and who prizes 'the new' over the established; whose head hurts so much that narcotics thrive and war is a facility. Oh - there's a bit of froth about trade, money and governance - small beer. That's where we are.

Oh.

There's a word that can go after that.

Not there yet.

Quite.

thegangofone (#43) What you still do not appear to have grasped is that in laissez-faire free-market economies governments minimally govern. This means that when deregulation (as so characteristic of Austrian School/Chicago School anarcho-capitalism) goes as far as it has, there's really very little that Liberal-Democratic politicians can do given that they have devolved whatever powers they had to centrally plan (govern) to the markets.

You may note tha even today Darling has been huffing and puffing about 'the banks' allegedly not lending enough.

But ask these questions:

1. Which banks (not all took part in the bailout)
2. The banks say they are lending at about the same level as last year and that they are not charities.
3. How much is 'not lending enough'?
4. Who should they be lending to? Small business which are not viable, or whch play the markets with cheap loans?

Just about all one hears in the media is expressed in such vague, indeterminate terms that nobody listening can possibly know what they're being told, i.e. what is true, what is false (and therefore be able to reason rationally), because of the nature of the language and quantifiers (some and all) it's simplistically expressed in. The commentators can not know what they are talking about either, you can't translate numeric issues into linguistic terms. They don't translate.

That is, what we are getting is largely just rhetoric.

JukMale (#44) That's becasue its antithesis, eugenics, has been rendered politically inorrect for quite egregions political ( warfare?) reasons. Note how the demographer was treated in the press not long ago.

This works perniciously by making some issues non-discussable, playing on people's self-doubts. One must ask why and not accept the obvious (as the evidnece is equivocable) as the roots to this go to the heart of and the consequences of ignoring it are dire and we are .

Last night's Newsnight was soporiphic beyond measure. Paxman looked bored out of his skull during the final panel discussion.

Why not have people on who can contemplate an alternative economic model to the one of unlimited growth, which everyone of common sense knows is unsustainable. The old order is over. Tinkering at the edges with VAT and saving the banks is not going to aid "recovery" -- but new thinking about the ways to order an economy that doesn't rely on greed and will help save the planet is what is now required.

Please have some new guests on the programme with some fresh ideas, not the same old usual boring suspects who go round and round in circles never getting anywhere.

#44 JunkkMale

Tried to write you a proper answer, when I got to the bit about The Dice Man



My browser closed and I lost the post.

But I have now found Barrie has already written what I should have written instead of wasting my time on things I don't believe.

Brown, Darling, Westminster, FTSE, Dow, Cameron, Cable, fiscal stimulus etc , and all other associated false paradigms.

Celtic Lion

#48 What!

Good Gracious Domino King

"A little revolution every now and then
is a healthy thing,
don't you think?"

Ramius (Sean Connery) to
Ryan (Alec Baldwin)
The Hunt for Red October


Perhaps Newsnight likes to exist in a comfortable established paradigm. Perhaps they don't want to move out of their comfort zone.

Perhaps they don't want to rock the boat or challenge the status quo. Perhaps they are happy with their cosy relationship with the existing order of things no matter how bad they are.

Perhaps Newsnight can only exist within the vision of its producers, within the existing paradigm.

Perhaps Newsnight wants to become the new Top of the Pops. Taken off air and wheeled out for a Christmas special.

Perhaps the name is an ironic play on words. Perhaps they should call them self Oldsnight.

Perhaps Newsnight wants to be a private members club only for the political establishment.

As myself and others have found out. If you write to or email Newsnight with important items. They completely ignore you. If you challenge the establishment.

Copernicus, Galileo, Darwin, Einstein et al would all have been rejected by Newsnight, because they all challenged the existing paradigm.

Newsnight is Paxman handing out colouring books of flat earth maps and then getting the guests to fill them in. No matter how pretty or good a job they make. The maps are still wrong.

Newsnight is not rock n roll though occasionally they will review it. Newsnight is not a big Jap 4 motorcycle breaking and finding grip on a drying out February road. Finding and surviving on the edge.

Newsnight will report on the "change we need" and get all excited. But Newsnight will never be an agent of, or be part of the the "change we need". They are scared of change, even if its good.

Newsnight is the the PR company of the political establishment and we pick up the bill.

The blogs are great I learn so much here off the other posters. But sorry if Newsnight clashes with Family Guy, my finger votes for Channel 7.

For the reasons you have just outlined.

Celtic Lion

dominoking (#48) Well said.

Someone needs to drive home to spin doctors that being economical with the truth is fine if one is in the entertainment business (like Hollywood) but elsewhere, pretentiously presented as rational analysis, is more than a tad irritating/narcissistic.

I really don't think some of the culprits are able to appreciate the difference. Newsnight used to be more than an opining show.

Finally a word to the wise: psychotherapy is as credible/respectable/efficacious as spin-doctoring.

CL #50

At the risk of biting the hand that gives us a little disc space - Hear, hear!

"Newsnight is not a big Jap 4 motorcycle breaking and finding grip on a drying out February road. Finding and surviving on the edge."

What a wonderful thought, Paxo with worn knee sliders.

#52 New Fazer

Thanks I was trying to think of analogies. We could send a manned mission to Mars tomorrow, but they would die.

The limiting factor is the ecological life support systems of the spacecraft. This is the most important part of the/any mission.

Apollo 13 was nearly lost because of this.

Yet we are on a much bigger spacecraft, Earth, and this has been forgotten by the politicians and their related media.

No video but the audio is OK. Though Street Machine is excellent. I think his earlier work on Montrose by Montrose is probably the best, if most overlooked rock album of all time.



I cannot see what relevance people with mainly legal backgrounds shouting at each other in a big house in Westminster has to fundamental questions of existence, eternity and infinity of our lives and this planet.

I feel they have invented a bubble they live in and the media have followed divorced from the practical running of a planet.

My view is more based on trajectories (racing lines) of probability and stability.

We are the warriors on the edge of time and we are tired of vat rate discussions.

Celtic Lion