The Post General Election Thread

http://www.theguardian.com/commentisfree/2015/may/18/britain-political-elite-fooled-us-again

"Every feat of misdirection is always intended to distract the audience from a sleight of hand. The same goes in politics – only here it’s aimed at taking our minds off the fact that all this jiggery-pokery is actually making us worse off. Let me show you what I mean, using figures calculated for the Guardian by academics at the Centre for Research on Socio-Cultural Change (Cresc) http://www.cresc.ac.uk/ , using official data. When Thatcher moved into No 10, 28% of all working age households took more from the state in cash benefits, in health and education and all the rest of it than they paid back in taxes. In other words, more than one in four employers in Britain were failing to pay their staff’s way.

More than three decades later, through Major and Blair and Brown and Cameron, that proportion has kept on rising. Now 38% of working-age households rely on taxpayers to pay their way. Think about all those tax credits for low-paid work, those exemptions for people earning too little even to be taxed. We have more people in work than ever before – and more households than ever before relying on the state to keep them afloat.

There’s nothing wrong with these people. These are the hard-working families politicians like talking about – the strivers, the squeezed middle, the alarm-clock Britain. But there’s a lot wrong with their employers – because they now rely on taxpayers to top up poverty pay, even while insisting on cuts in corporation tax and grants for investment. Come 8 July, it won’t be those businesses that the chancellor tells to change their ways – it’ll be the people they employ who will see more money taken out of their weekly budget by the cuts. Because the one thing we know about the next round of cuts is that they will hit the working poor all over again, like a hammer to the face."
 
It's not real deflation really and it's mainly down to oil price dropping and therefore the cost of making and transporting good is cheaper.

It's a good thing if you earn the same or more than last year in terms of the spending power of money in your pocket.

It won't last though.
 
The perfect fumble said:
karen7 said:
So we are now in deflation

Can someome explain if this is good or bad please

Someone unbiased preferably

Analysis: Robert Peston, BBC economics editor

The last time we saw a price fall in the UK was March 1960, before even I was born, when there was a drop (probably) of 0.6%.

So my natural impulse is to say that deflation has arrived in Britain - because there is no other word in the English language than "deflation" to describe this phenomenon.

However many of those who define themselves as "serious economists" (that's not me, by the way - I'm a hack) are desperately anxious that I and you don't use the "d" word - for two reasons.

One is that they say proper deflation is a long term term trend of declining prices, and they believe - almost certainly correctly - that these current price falls won't endure much more than a month or two.

The other is that proper deflation is pernicious: if we believed that prices were set to fall month after relentless month, we would spend less - in the hope of picking up bargains later - and our bosses would pay us less.

http://www.bbc.co.uk/news/business-32796307

Must have taken 6 months for Peston to say all those words in one sentence, drives me nuts waiting for him to finish a word never mind a sentence..!
 
SWP's back said:
It's not real deflation really...

It's not a real recovery either so that's all right. This "it's not real deflation" nonsense is the latest spin from the Tories and their media allies. It might not be but we won't really know for a few months. By that time they'll have one up with another excuse.

Deflation is caused by a fall in aggregate demand, which is what some of us have been saying will happen for a while.

This is because the "recovery" was based on unsustainable consumer spending rather than being output driven. Now that's stopped and the danger is that people will hoard cash rather than invest it. What we should be doing is stimulating demand, even if that requires additional debt.

By doing it, companies increase production, real wages rise and people are encouraged to invest their surplus cash in the government bonds issued to create the debt.
 
The perfect fumble said:
http://www.theguardian.com/commentisfree/2015/may/18/britain-political-elite-fooled-us-again

"Every feat of misdirection is always intended to distract the audience from a sleight of hand. The same goes in politics – only here it’s aimed at taking our minds off the fact that all this jiggery-pokery is actually making us worse off. Let me show you what I mean, using figures calculated for the Guardian by academics at the Centre for Research on Socio-Cultural Change (Cresc) http://www.cresc.ac.uk/ , using official data. When Thatcher moved into No 10, 28% of all working age households took more from the state in cash benefits, in health and education and all the rest of it than they paid back in taxes. In other words, more than one in four employers in Britain were failing to pay their staff’s way.

More than three decades later, through Major and Blair and Brown and Cameron, that proportion has kept on rising. Now 38% of working-age households rely on taxpayers to pay their way. Think about all those tax credits for low-paid work, those exemptions for people earning too little even to be taxed. We have more people in work than ever before – and more households than ever before relying on the state to keep them afloat.

There’s nothing wrong with these people. These are the hard-working families politicians like talking about – the strivers, the squeezed middle, the alarm-clock Britain. But there’s a lot wrong with their employers – because they now rely on taxpayers to top up poverty pay, even while insisting on cuts in corporation tax and grants for investment. Come 8 July, it won’t be those businesses that the chancellor tells to change their ways – it’ll be the people they employ who will see more money taken out of their weekly budget by the cuts. Because the one thing we know about the next round of cuts is that they will hit the working poor all over again, like a hammer to the face."

My daughter is one of the 38%. She's had two kids in the last three years, split up with her partner, works part time and her earnings are topped up by tax credits etc, She works for a small charity that has been very good to her in terms of flexibility but doesnt pay a big wage, because it couldnt afford to. When the kids are at school she should be able to earn more, move out of the 38%. Is there "a lot wrong" with her employer?
 
SWP's back said:
It's not real deflation really and it's mainly down to oil price dropping and therefore the cost of making and transporting good is cheaper.

It's a good thing if you earn the same or more than last year in terms of the spending power of money in your pocket.

It won't last though.
Then why are fuel prices going up? Diesel was 109 a litre not too long ago it's back to 119 now!
 
Blue Maverick said:
SWP's back said:
It's not real deflation really and it's mainly down to oil price dropping and therefore the cost of making and transporting good is cheaper.

It's a good thing if you earn the same or more than last year in terms of the spending power of money in your pocket.

It won't last though.
Then why are fuel prices going up? Diesel was 109 a litre not too long ago it's back to 119 now!
It takes time to feed through to the index.
It'll probably be back in positive territory soon.
 
Prestwich_Blue said:
SWP's back said:
It's not real deflation really...

It's not a real recovery either so that's all right. This "it's not real deflation" nonsense is the latest spin from the Tories and their media allies. It might not be but we won't really know for a few months. By that time they'll have one up with another excuse.

Deflation is caused by a fall in aggregate demand, which is what some of us have been saying will happen for a while.

This is because the "recovery" was based on unsustainable consumer spending rather than being output driven. Now that's stopped and the danger is that people will hoard cash rather than invest it. What we should be doing is stimulating demand, even if that requires additional debt.

By doing it, companies increase production, real wages rise and people are encouraged to invest their surplus cash in the government bonds issued to create the debt.
No
 
Blue Maverick said:
SWP's back said:
It's not real deflation really and it's mainly down to oil price dropping and therefore the cost of making and transporting good is cheaper.

It's a good thing if you earn the same or more than last year in terms of the spending power of money in your pocket.

It won't last though.
Then why are fuel prices going up? Diesel was 109 a litre not too long ago it's back to 119 now!
Because the figures don't work in real time.
 

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