The Labour Government

[Chippy_boy]

Disappointing that BoE and Governement are keeping interest at 5%. There is a significant chance that inflation won't rise this autumn when new taxes brought in by the government start to bite. But Bailey didn't seem to factor that in?

Honestly I think Bailey is a buffoon. What he and his committee of experts never factored in was that the biggest driver of increasing prices was NOT excess demand, prices were rising due to supply-side pressures and cost increases working their way through the system. About which dampening demand with higher interest rates, is completely the wrong response. He's kept interest rates far too high for far too long and all that has done is depress growth, make people poorer and ultimately due to falling demand, put companies out of business. I hear TGI's is another one to fall this morning. If people don't have spare cash in their pockets, they are not buying non-essentials and the high interest rates and energy costs are crippling peoples' mortgage payments and fuel bills.

If we had 4%, 5% growth and the economy was overheating - demand outpacing our ability to grow capacity - then fair enough. But that is hardly the situation now, is it.

 

[hampshireblue]

I just heard that Starmer earned circa £404k last year and paid £99k in tax.

Plugging £400k into Martin Lewis' income tax calculator, you get this:

View attachment 132250

He's paid circa £70,000 less than any other highly paid employee. So presumably he's benefitted from various tax dodges about which he has at the same time been critical. Honestly I cannot think of a politician I loathe more than this man.

Without knowing the source of all of the income, running it through this is unlikely to give an accurate figure.

So you prefer Johnson, Farage and Trump? Really?

 

[inbetween]

A technocracy is communism but without killing people. It’s a no from me.

I don’t think many people enter politics with anything other than pure intentions. Of course power corrupts and it broadly corrupts all to some degree who stick around long enough. What I think is becoming more apparent is the uncovering of how much power civil servants actually wield. Cummings was probably right in that regard.

Be interesting to see how Starmer - being the control freak he is - deals with it all. Labour have entered office with an obvious desire to want to do well, they will either fight the civil service or go meekly to their political graves. If Starmer is able to break through the bureaucracy he may leave a legacy not seen but greater than most other PMs.

Why is it communism? That's an odd argument mate. I'm not arguing for a technocratic takeover to replace our economic and social system. Working together to get to the best decision isn't communism. Communism is just a political outcome of whatever political goal. I want the opposite of that, to make decisions aside from politics. If communism is not the best economic and social model available then there will be no communism.

You only have to look at Brexit, where are the benefits today? If your house is burning down then would you put out the fire? A technocracy would say yes whereas politicians would have an argument about it. Anybody with a brain and common sense would reverse Brexit tomorrow but nobody can because of the political shite that surrounds it.

Naturally I'd expect anybody who supports Brexit to say well it's the democratic will of the people etc but that is the stupidity of involving politics in a relatively simple decision. Today Brexit is framed only in the lens of how worse off we are as opposed to how better off we are.... That tells you all you need to know, we all know it but we're paralysed in action because of politics.

I'd prefer to deal in truth, logic and common sense, this shouldn't be controversial. There are parties who deal in the opposite of these ideals such as Reform and they're growing in voice. It's surely not a coincidence that Reform are the ones who most attack the institutions such as the Civil Service whose job is to deal in facts and truth... The reason why is the truth does not conveniently lend itself to their policies and lies.

The west is unfortunately marching towards the opposite of sensible technocracy which is government run solely by soundbites, fingers in the air and total populist bullshit.

 

[BridgyDids]

To be fair. I did not know this when posting earlier this morning. I just heard about the £400k income, so that makes sense if a chunk of it was capital gain.

But, let me ask you this, in all seriousness. How would you feel if Starmer, having benefitted from a big chunk of income only taxed at 25%, in a few weeks time decides to increase capital gains tax so that anyone in future has to pay the marginal income tax rate on their capital gains, i.e. anyone on his income level would have to pay 45%, nearly twice as much tax as he paid.

Would you think that is fair enough? Or would you think slimy bastard, one rule for him and one rule for everyone else? I'd be interested in your perspective (God knows why).

The same way I feel about other people cashing in on businesses / houses etc now. All power to them , but the level should have been raised years ago.

He wasn’t in power 12 months ago (or even 4 months ago!). If he’s benefitted massively in the last two months, then again - this would stink.

And once again for the record, I’m disappointed in him getting all the freebies and not declaring it. Does stink a little, but same can be said for them all!

 

[Kompany Car]

That may be the case but it's not a reflection on new build housing, which is what we need to get people on the property ladder.

New house build starts are at their lowest ever apart from the 2008 recession and the 2020 covid recession.

The truth is we haven't been building enough housing for the past 30 years

I think one of the issues will be people downsizing due to cheap mortgages coming to an end so causing even more strain on the smaller properties market.

I can see this locally where the cheap end of the market is very busy, but get up into the 600k+ band and they are sticking around for a long time.

 

[Churchlawtonblue]

I think one of the issues will be people downsizing due to cheap mortgages coming to an end so causing even more strain on the smaller properties market.

I can see this locally where the cheap end of the market is very busy, but get up into the 600k+ band and they are sticking around for a long time.

Yes I agree entirely.

 

[Churchlawtonblue]

Honestly I think Bailey is a buffoon. What he and his committee of experts never factored in was that the biggest driver of increasing prices was NOT excess demand, prices were rising due to supply-side pressures and cost increases working their way through the system. About which dampening demand with higher interest rates, is completely the wrong response. He's kept interest rates far too high for far too long and all that has done is depress growth, make people poorer and ultimately due to falling demand, put companies out of business. I hear TGI's is another one to fall this morning. If people don't have spare cash in their pockets, they are not buying non-essentials and the high interest rates and energy costs are crippling peoples' mortgage payments and fuel bills.

If we had 4%, 5% growth and the economy was overheating - demand outpacing our ability to grow capacity - then fair enough. But that is hardly the situation now, is it.

To be honest, since he has been Governor of the BofE had had got more forecasts wrong than right.

 

[hampshireblue]

I fundamentally, completely, disagree with you.

My employer pays ME to do work for them. They give ME the money. The government does not have any of its own money, only money it takes off working people like me. They take money that my employer pays ME and grab some of it for themselves. It does not become THEIR money when they do that. It is OUR money, that they are using to fund XYZ.

Similarly a thief cannot say this is MY money when he has stolen money off you. It is YOUR money that the thief has stolen. It is not the thiefs money.

Now everyone accepts that we need a level of taxation to pay for public services and that is fine. But please do not fall into the trap of thinking that the government is spending its own money. It isn't. It is spending your, and other taxpayers, money.

So after your inaccurate knowledge over pensions, lets have a little look at this:

"My employer pays ME to do work for them. They give ME the money. The government does not have any of its own money, only money it takes off working people like me. They take money that my employer pays ME and grab some of it for themselves. It does not become THEIR money when they do that. It is OUR money, that they are using to fund XYZ."

Not strictly, or even remotely correct. HMG (the Govt) does indeed have it's own money. It basically owns the BoE and the BoE is tasked with making sure HMG doesn't go broke. HMG decides what's it's going to spend it's money on. It doesn't wait for Chippy to decide to pay his tax. It spends money provided to it by the BoE and then uses tax intake to pay off some of the debt it has generated. One of the benefits of having our own currency is that HMG can't go bust, as it has the ability to print more money when needed, hopefully for investment and in a non-inflationary manner. This is basically what Quantative Easing was. It printed money, gave it to the banks and consequently the banks then leant it out at a significant premium compared to the rock bottom interest rates we had at that time. Effectively money is loaned into the economy and some of it taken back immediately in the form of tax.

It's an easy trap to fall into, and I would have agreed with you on the mechanism of taxation a few months ago. But reading a book called The Deficit Myth lays out a compelling path as to how the economy really works. It doesn't suit all political views, but as someone who's voted Red, Blue and Yellow and worked in both public and private industry, it make utmost sense. What you mustn't be is entrenched to see the logic in the arguments made.

 

[kaz7]

You should, it’s very therapeutic. Many of my work emails start like that as well but don’t get sent until after the 4th or 5th rewrite hence why I’ve not been fired.

I dont call posters it because i would be banned ! In my head then yes, lok

 

[KS55]

“One of the benefits of having our own currency is that HMG can’t go bust.” @hampshireblue
A terrible myth. If the fundamentals of your economy are bad and/or you print too much money, you will go bust as the value of your currency crashes and you cannot use it in the market place. There are plenty of examples of countries whose currency was worth less than the paper it was printed on.
Try buying anything with roubles at the mo.