Tony Blair on Nick Robinson's Show

[robbieh]

This economy does a lot for the rest of us, it is why you and me aren't fighting in the street for food and why poverty is now defined by proportion of income spent on housing costs and not whether you have a house at all.

If you look at the last 50 years, has poverty, general wellbeing and opportunity gone up or down? All the facts say that we are richer, medically fitter and generally better off than any time before.

The things you are talking about aren't about equalizing society to make it fair, you want to equalize society so it is unfair and punishes the rich.

If you won the lottery, would you distribute your winnings to the local economy or would you keep it for yourself? I know of no-one who would distribute it so why should business owners who took risks and worked hard to pay for that lottery ticket?

Not disagreeing that people are essentially self interested. They'd probably vote for zero taxes despite the fact their lives would tank big time.

This is why we have governments to tax people.

Your idea that people get rich solely due to their own efforts is bogus. They benefit from infrastructure put in place by the state, tax breaks that allow them to get exponentially richer than their staff. A lot is also down to timing and luck.

I am not talking about equalising society as you put it or punishing the rich.

I am talking about an economy that works for the many not the few.

 

[inbetween]

I can see I will have to try harder.

Take a businessman with 99 employees. He has an annual profit of 2 million.

He decides to distribute it amongst himself and his employees equally. 20,000 each.

As it is not a huge salary they spend it on all the usual things, food, booze, petrol, football, clothes etc

One day the businessman thinks why am I paying my staff so much. After all I took all the risk. So he decides to pay his staff 10,000 each.

He now has 1 million for himself so he goes and buys a sketch by Picasso.

Meanwhile the local economy takes a hit. Clothes sales are down. So too bars and restaurants. Season ticket numbers falter as people on their reduced wages can't afford them.

But the fine art market booms.

It all went wrong when you said the businessman just decided to pay his staff less, why would this happen? Any business owner with a brain knows that good staff are the most important thing he has because there is no business without them.

Most if not all business owners pay staff competitively and beyond where they can because treating people well is how you retain them. If he treats people badly they will leave and then his once good business will potentially turn into a bad one.

Forgetting the pay staff less bit, what if the business owner takes that £2m and invests it in a payrise and new facilities which turns that £2m profit into £4m profit next year giving everyone another payrise? This is capitalism at its best.

 

[inbetween]

Not disagreeing that people are essentially self interested. They'd probably vote for zero taxes despite the fact their lives would tank big time.

This is why we have governments to tax people.

Your idea that people get rich solely due to their own efforts is bogus. They benefit from infrastructure put in place by the state, tax breaks that allow them to get exponentially richer than their staff. A lot is also down to timing and luck.

I am not talking about equalising society as you put it or punishing the rich.

I am talking about an economy that works for the many not the few.

Where do you think tax comes from?

You do know that the rich and businesses pay more tax than anyone else put together don't you?

If you redistributed the riches wealth to be spent in the economy and the rich decided to stop investing in their businesses because of this, where will your tax money now come from?

You just expect businesses to effectively work for free where rewards are instead returned to the state. I can't think of any bigger reason to tell them why they shouldn't bother starting that business in the first place.

 

[Damocles]

People often compare Germany to us and the reason we are in a pickle and Germany aren't is because Germany imposed immediate hard austerity upon 2008 hitting which enabled them to keep public debt under control.

They now responsibly spend their way out of the problem by linking that spending to growth. Once borrowing is under control they can do as you say which is to have spending bursts to invest in infrastruture, services etc to supplement that growth however if growth falls, spending falls, it is very simple.

Germany implemented the softest austerity measure of any major world economy. Less than the US. Significantly less than us.

Austerity doesn't work because the economy isn't a balance sheet and doesn't function in the same lazy profit/loss terms that so many Tories seem to believe it does.

 

[Scottyboi]

Germany implemented the softest austerity measure of any major world economy. Less than the US. Significantly less than us.

Austerity doesn't work because the economy isn't a balance sheet and doesn't function in the same lazy profit/loss terms that so many Tories seem to believe it does.

The complete opposite of what Inbetween claimed lmao.

 

[robbieh]

It all went wrong when you said the businessman just decided to pay his staff less, why would this happen? Any business owner with a brain knows that good staff are the most important thing he has because there is no business without them.

Most if not all business owners pay staff competitively and beyond where they can because treating people well is how you retain them. If he treats people badly they will leave and then his once good business will potentially turn into a bad one.

Forgetting the pay staff less bit, what if the business owner takes that £2m and invests it in a payrise and new facilities which turns that £2m profit into £4m profit next year giving everyone another payrise? This is capitalism at its best.

The example I gave was not really about whether a good business would act in this way or not.

I was trying to show how money shapes the market for goods. In my example a worker may leave the food sector and get that job in auctioneering. He may even get paid more. In your world all is fine and dandy.

Mine not so much. I don't want fellow workers rushing off to work in the luxury goods end of the market. I want a decent apple not an Aston Martin.

The super rich have undue influence politically but more importantly they shape the very market we are in, both as consumers and producers.

One other thing. When I talk about this I am not talking about you setting up a business, doing well and then having your money taken off you by the taxman.

The big problem is that many ordinary businessmen think they are nearer Buffet and Gates when in reality they are nearer that homeless man on the street corner.

Your interests, as an entrepreneur, and mine as a teacher are not best served by pandering to a super class.

 

[Prestwich_Blue]

It all went wrong when you said the businessman just decided to pay his staff less, why would this happen? Any business owner with a brain knows that good staff are the most important thing he has because there is no business without them.

Then why do so many ditch their UK staff and outsource to place like India or move production to low wage economies?

 

[Prestwich_Blue]

The complete opposite of what Inbetween claimed lmao.

Inbetween is George Osborne and I claim my £5.

 

[inbetween]

Germany implemented the softest austerity measure of any major world economy. Less than the US. Significantly less than us.

Austerity doesn't work because the economy isn't a balance sheet and doesn't function in the same lazy profit/loss terms that so many Tories seem to believe it does.

It depends on how you define hard and soft austerity. Given spending levels are increasing every year would you say the UK is engaged in hard austerity? Hard austerity to me is Greece, IE, you cannot afford to run public services so you don't or your banking system is so fragile that you have to restrict how much people can withdraw from cash machines.

Germany imposed okay 'softer' austerity but they did so under the same principle, to control spending so as to manage the public debt burden responsibly. If austerity was wrong in principle then surely you are saying I am wrong and Germany were also wrong to impose any form of austerity at all? That is a different argument to saying it was a bit softer than ours...

I think the best word is balance, we need to balance spending against our growth but with Brexit and the world economy at the moment we won't be growing much anytime soon. Logic dicatates then that it would be total stupidity to embark on a spending spree unfunded by the taxpayer which is the kind Corbyn and co are planning.

As I said earlier, if people want more spending then everyone (yes everyone) needs to start paying more tax, there is no other way.

 

[inbetween]

Then why do so many ditch their UK staff and outsource to place like India or move production to low wage economies?

Because it is cheaper, it isn't exploitation. If India can do the same job for cheaper then unfortunately that is the nature of the job you do. It is no different to a business replacing you with a robot. The vast majority of jobs however are not done by robots nor are they in India and the employment statistics and number of vacancies out there pretty much supports that.

The same question as before stands, if you won the lottery would you distribute it out to the local economy? Most people wouldn't, so why would you expect a business owner to exist only to act as a cash machine? In fact if there was no reward allowed then why would you even bother in the first place?

Basically the key argument folk are making is workers should not be allowed to be exploited but businesses should? Is that fair?