Clearing up the ‘mess’

YOUR lead letter of December 20 by T Scaife poses a question, laying as it does all the ills of society at the door of our mish-mash of a government.

I would ask readers to cast their minds back a couple of years when we had a change of government. An incoming minister was shocked to find a note from his New Labour predecessor, to the effect that “the money has all gone”.

It seems that the current regime could do worse than publish this message at regular intervals, just to remind us all of the mess left behind and the attitude of some of those responsible for it.

With all the cash gone, any new government would have to establish a stable economy by whatever means it could.

The siren calls from the left of “borrow it” can only be valid so long as there are lenders prepared to bale out Britain and, as certain EU countries have discovered, this is at an increasing price and not certain.

This lot have many faults but at least they are trying, whereas almost all socialist regimes have failed.

So come off it, Mr Scaife, we have no option but to tighten the national belt and only do what we can afford: a simple motto but somewhat ignored in recent times.

Charles Rushton, Pasture Close, Strensall, York.

Comments (7)

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12:02pm Mon 24 Dec 12

Zetkin says...

Tightening the "national belt" sounds good doesn't it?

Almost as if we're somehow all in this together.

Except of course, it's the belts of the poorest that are being tightened the most, while the coalition's rich pals take advantage to boost their already immense share of the country's wealth. They are using the depression to redistribute wealth upwards, which is what the rich always do during times of crisis.

As for borrowing, the coalition is still increasing the national debt faster and faster.

Merry Christmas, if you can afford it.
Tightening the "national belt" sounds good doesn't it? Almost as if we're somehow all in this together. Except of course, it's the belts of the poorest that are being tightened the most, while the coalition's rich pals take advantage to boost their already immense share of the country's wealth. They are using the depression to redistribute wealth upwards, which is what the rich always do during times of crisis. As for borrowing, the coalition is still increasing the national debt faster and faster. Merry Christmas, if you can afford it. Zetkin
  • Score: 0

12:55pm Mon 24 Dec 12

perplexed says...

After continuously stating the UK had the biggest debt in the world George Osborne admitted to the Treasury Select Committee that he did not know the UK had the lowest debt in the G7? Also, confirmed by the OECD Those who use cash terms (instead of percentages) do so to scare, mislead and give half the story.

Labour in 1997 inherited a debt of 42% of GDP. By the start of the global banking crises 2008 the debt had fallen to 35% - a near 22% reduction Surprisingly, a debt of 42% was not seen as a major problem and yet at 35% the sky was falling down?



In 1997 Labour inherited a deficit of 3.9% of GDP (not a balanced budget ) and by 2008 it had fallen to 2.1% - a reduction of a near 50% . Hence, it's implausible to claim there was a simple question of overspending. The deficit was exacerbated by the global banking crises after 2008.

The IMF have also concluded the same. They reveal the UK experienced an increase in the deficit as result of a large loss in output/GDP caused by the global banking crisis and not even as result of the bank bailouts, fiscal stimulus and bringing forward of capital spending. It's basic economics: when output falls the deficit increases.
Finally, the large loss in output occurred because the UK like the US have the biggest financial centres and as this was a global banking crises we suffered the most. Hence, the UK had the 2nd highest deficit in the G7 (Not The World) after the US and not as a result of overspending prior to and after 2008- as the IMF concur.

While the markets appear to have confidence in Osborne's austerity plan the real reason why our borrowing costs have fallen and remained low since 2008 is because, savings have increased. As a result, the demand and price for bonds have increased and as there is inverse relationship between the price of bonds and its yield (interest rate) the rates have fallen. Also, the markets expect the economy to remain stagnate. Which means the price for bonds will remain high and hence, our borrowing costs will also remain low.

Secondly, the UK is considered a safe heaven because, investors are reassured the Bank of England will buy up bonds in an event of any sell off - which increases the price of bonds and reduces the effective rate. Note, how rates fell across the EU recently when the ECB announced its bond buying program. Thirdly, because, we are not in the Euro we can devalue our currency to increase exports. Moreover, UK bonds are attractive because, we haven't defaulted on its debt for over 300 years.
After continuously stating the UK had the biggest debt in the world George Osborne admitted to the Treasury Select Committee that he did not know the UK had the lowest debt in the G7? Also, confirmed by the OECD Those who use cash terms (instead of percentages) do so to scare, mislead and give half the story. Labour in 1997 inherited a debt of 42% of GDP. By the start of the global banking crises 2008 the debt had fallen to 35% - a near 22% reduction Surprisingly, a debt of 42% was not seen as a major problem and yet at 35% the sky was falling down? In 1997 Labour inherited a deficit of 3.9% of GDP (not a balanced budget ) and by 2008 it had fallen to 2.1% - a reduction of a near 50% . Hence, it's implausible to claim there was a simple question of overspending. The deficit was exacerbated by the global banking crises after 2008. The IMF have also concluded the same. They reveal the UK experienced an increase in the deficit as result of a large loss in output/GDP caused by the global banking crisis and not even as result of the bank bailouts, fiscal stimulus and bringing forward of capital spending. It's basic economics: when output falls the deficit increases. Finally, the large loss in output occurred because the UK like the US have the biggest financial centres and as this was a global banking crises we suffered the most. Hence, the UK had the 2nd highest deficit in the G7 (Not The World) after the US and not as a result of overspending prior to and after 2008- as the IMF concur. While the markets appear to have confidence in Osborne's austerity plan the real reason why our borrowing costs have fallen and remained low since 2008 is because, savings have increased. As a result, the demand and price for bonds have increased and as there is inverse relationship between the price of bonds and its yield (interest rate) the rates have fallen. Also, the markets expect the economy to remain stagnate. Which means the price for bonds will remain high and hence, our borrowing costs will also remain low. Secondly, the UK is considered a safe heaven because, investors are reassured the Bank of England will buy up bonds in an event of any sell off - which increases the price of bonds and reduces the effective rate. Note, how rates fell across the EU recently when the ECB announced its bond buying program. Thirdly, because, we are not in the Euro we can devalue our currency to increase exports. Moreover, UK bonds are attractive because, we haven't defaulted on its debt for over 300 years. perplexed
  • Score: 0

2:35pm Mon 24 Dec 12

yorkshirelad says...

It certainly true that the last government made errors - particularly not coming down far more heavily on the excesses of the City of London (and can you imagine what the right-wing press would have said about that?).

What is also certainly true is that this government have made gross errors. The worldwide economic downturn (was this all Labours's fault?) gave them an opportunity to implement their ideology...and we can now see the results. This is no 'one-nation' Tory party and their aim will be to benefit the extremely wealthy at the expense of those at the other end of the wealth scale.

The other thing they are doing opportunistically is setting up everything for privatisation. Once your NHS and your Royal Mail have gone and are run by multi-national corporations, you will realise what you've lost...but it will be too late by then.
It certainly true that the last government made errors - particularly not coming down far more heavily on the excesses of the City of London (and can you imagine what the right-wing press would have said about that?). What is also certainly true is that this government have made gross errors. The worldwide economic downturn (was this all Labours's fault?) gave them an opportunity to implement their ideology...and we can now see the results. This is no 'one-nation' Tory party and their aim will be to benefit the extremely wealthy at the expense of those at the other end of the wealth scale. The other thing they are doing opportunistically is setting up everything for privatisation. Once your NHS and your Royal Mail have gone and are run by multi-national corporations, you will realise what you've lost...but it will be too late by then. yorkshirelad
  • Score: 0

2:44pm Wed 26 Dec 12

CynicaloldGit says...

perplexed wrote:
After continuously stating the UK had the biggest debt in the world George Osborne admitted to the Treasury Select Committee that he did not know the UK had the lowest debt in the G7? Also, confirmed by the OECD Those who use cash terms (instead of percentages) do so to scare, mislead and give half the story.

Labour in 1997 inherited a debt of 42% of GDP. By the start of the global banking crises 2008 the debt had fallen to 35% - a near 22% reduction Surprisingly, a debt of 42% was not seen as a major problem and yet at 35% the sky was falling down?



In 1997 Labour inherited a deficit of 3.9% of GDP (not a balanced budget ) and by 2008 it had fallen to 2.1% - a reduction of a near 50% . Hence, it's implausible to claim there was a simple question of overspending. The deficit was exacerbated by the global banking crises after 2008.

The IMF have also concluded the same. They reveal the UK experienced an increase in the deficit as result of a large loss in output/GDP caused by the global banking crisis and not even as result of the bank bailouts, fiscal stimulus and bringing forward of capital spending. It's basic economics: when output falls the deficit increases.
Finally, the large loss in output occurred because the UK like the US have the biggest financial centres and as this was a global banking crises we suffered the most. Hence, the UK had the 2nd highest deficit in the G7 (Not The World) after the US and not as a result of overspending prior to and after 2008- as the IMF concur.

While the markets appear to have confidence in Osborne's austerity plan the real reason why our borrowing costs have fallen and remained low since 2008 is because, savings have increased. As a result, the demand and price for bonds have increased and as there is inverse relationship between the price of bonds and its yield (interest rate) the rates have fallen. Also, the markets expect the economy to remain stagnate. Which means the price for bonds will remain high and hence, our borrowing costs will also remain low.

Secondly, the UK is considered a safe heaven because, investors are reassured the Bank of England will buy up bonds in an event of any sell off - which increases the price of bonds and reduces the effective rate. Note, how rates fell across the EU recently when the ECB announced its bond buying program. Thirdly, because, we are not in the Euro we can devalue our currency to increase exports. Moreover, UK bonds are attractive because, we haven't defaulted on its debt for over 300 years.
where did you get this info? is there a link to it, I could use this if it is true and can be proved.
Please give me the sourse
[quote][p][bold]perplexed[/bold] wrote: After continuously stating the UK had the biggest debt in the world George Osborne admitted to the Treasury Select Committee that he did not know the UK had the lowest debt in the G7? Also, confirmed by the OECD Those who use cash terms (instead of percentages) do so to scare, mislead and give half the story. Labour in 1997 inherited a debt of 42% of GDP. By the start of the global banking crises 2008 the debt had fallen to 35% - a near 22% reduction Surprisingly, a debt of 42% was not seen as a major problem and yet at 35% the sky was falling down? In 1997 Labour inherited a deficit of 3.9% of GDP (not a balanced budget ) and by 2008 it had fallen to 2.1% - a reduction of a near 50% . Hence, it's implausible to claim there was a simple question of overspending. The deficit was exacerbated by the global banking crises after 2008. The IMF have also concluded the same. They reveal the UK experienced an increase in the deficit as result of a large loss in output/GDP caused by the global banking crisis and not even as result of the bank bailouts, fiscal stimulus and bringing forward of capital spending. It's basic economics: when output falls the deficit increases. Finally, the large loss in output occurred because the UK like the US have the biggest financial centres and as this was a global banking crises we suffered the most. Hence, the UK had the 2nd highest deficit in the G7 (Not The World) after the US and not as a result of overspending prior to and after 2008- as the IMF concur. While the markets appear to have confidence in Osborne's austerity plan the real reason why our borrowing costs have fallen and remained low since 2008 is because, savings have increased. As a result, the demand and price for bonds have increased and as there is inverse relationship between the price of bonds and its yield (interest rate) the rates have fallen. Also, the markets expect the economy to remain stagnate. Which means the price for bonds will remain high and hence, our borrowing costs will also remain low. Secondly, the UK is considered a safe heaven because, investors are reassured the Bank of England will buy up bonds in an event of any sell off - which increases the price of bonds and reduces the effective rate. Note, how rates fell across the EU recently when the ECB announced its bond buying program. Thirdly, because, we are not in the Euro we can devalue our currency to increase exports. Moreover, UK bonds are attractive because, we haven't defaulted on its debt for over 300 years.[/p][/quote]where did you get this info? is there a link to it, I could use this if it is true and can be proved. Please give me the sourse CynicaloldGit
  • Score: 0

11:30pm Wed 26 Dec 12

perplexed says...

CynicaloldGit wrote:
perplexed wrote:
After continuously stating the UK had the biggest debt in the world George Osborne admitted to the Treasury Select Committee that he did not know the UK had the lowest debt in the G7? Also, confirmed by the OECD Those who use cash terms (instead of percentages) do so to scare, mislead and give half the story.

Labour in 1997 inherited a debt of 42% of GDP. By the start of the global banking crises 2008 the debt had fallen to 35% - a near 22% reduction Surprisingly, a debt of 42% was not seen as a major problem and yet at 35% the sky was falling down?



In 1997 Labour inherited a deficit of 3.9% of GDP (not a balanced budget ) and by 2008 it had fallen to 2.1% - a reduction of a near 50% . Hence, it's implausible to claim there was a simple question of overspending. The deficit was exacerbated by the global banking crises after 2008.

The IMF have also concluded the same. They reveal the UK experienced an increase in the deficit as result of a large loss in output/GDP caused by the global banking crisis and not even as result of the bank bailouts, fiscal stimulus and bringing forward of capital spending. It's basic economics: when output falls the deficit increases.
Finally, the large loss in output occurred because the UK like the US have the biggest financial centres and as this was a global banking crises we suffered the most. Hence, the UK had the 2nd highest deficit in the G7 (Not The World) after the US and not as a result of overspending prior to and after 2008- as the IMF concur.

While the markets appear to have confidence in Osborne's austerity plan the real reason why our borrowing costs have fallen and remained low since 2008 is because, savings have increased. As a result, the demand and price for bonds have increased and as there is inverse relationship between the price of bonds and its yield (interest rate) the rates have fallen. Also, the markets expect the economy to remain stagnate. Which means the price for bonds will remain high and hence, our borrowing costs will also remain low.

Secondly, the UK is considered a safe heaven because, investors are reassured the Bank of England will buy up bonds in an event of any sell off - which increases the price of bonds and reduces the effective rate. Note, how rates fell across the EU recently when the ECB announced its bond buying program. Thirdly, because, we are not in the Euro we can devalue our currency to increase exports. Moreover, UK bonds are attractive because, we haven't defaulted on its debt for over 300 years.
where did you get this info? is there a link to it, I could use this if it is true and can be proved.
Please give me the sourse
Happy to oblige!
http://www.huffingto
npost.co.uk/ramesh-p
atel/growth-cameron-
austerity_b_2007552.
html
[quote][p][bold]CynicaloldGit[/bold] wrote: [quote][p][bold]perplexed[/bold] wrote: After continuously stating the UK had the biggest debt in the world George Osborne admitted to the Treasury Select Committee that he did not know the UK had the lowest debt in the G7? Also, confirmed by the OECD Those who use cash terms (instead of percentages) do so to scare, mislead and give half the story. Labour in 1997 inherited a debt of 42% of GDP. By the start of the global banking crises 2008 the debt had fallen to 35% - a near 22% reduction Surprisingly, a debt of 42% was not seen as a major problem and yet at 35% the sky was falling down? In 1997 Labour inherited a deficit of 3.9% of GDP (not a balanced budget ) and by 2008 it had fallen to 2.1% - a reduction of a near 50% . Hence, it's implausible to claim there was a simple question of overspending. The deficit was exacerbated by the global banking crises after 2008. The IMF have also concluded the same. They reveal the UK experienced an increase in the deficit as result of a large loss in output/GDP caused by the global banking crisis and not even as result of the bank bailouts, fiscal stimulus and bringing forward of capital spending. It's basic economics: when output falls the deficit increases. Finally, the large loss in output occurred because the UK like the US have the biggest financial centres and as this was a global banking crises we suffered the most. Hence, the UK had the 2nd highest deficit in the G7 (Not The World) after the US and not as a result of overspending prior to and after 2008- as the IMF concur. While the markets appear to have confidence in Osborne's austerity plan the real reason why our borrowing costs have fallen and remained low since 2008 is because, savings have increased. As a result, the demand and price for bonds have increased and as there is inverse relationship between the price of bonds and its yield (interest rate) the rates have fallen. Also, the markets expect the economy to remain stagnate. Which means the price for bonds will remain high and hence, our borrowing costs will also remain low. Secondly, the UK is considered a safe heaven because, investors are reassured the Bank of England will buy up bonds in an event of any sell off - which increases the price of bonds and reduces the effective rate. Note, how rates fell across the EU recently when the ECB announced its bond buying program. Thirdly, because, we are not in the Euro we can devalue our currency to increase exports. Moreover, UK bonds are attractive because, we haven't defaulted on its debt for over 300 years.[/p][/quote]where did you get this info? is there a link to it, I could use this if it is true and can be proved. Please give me the sourse[/p][/quote]Happy to oblige! http://www.huffingto npost.co.uk/ramesh-p atel/growth-cameron- austerity_b_2007552. html perplexed
  • Score: 0

1:22am Thu 27 Dec 12

ColdAsChristmas says...

Also let us not forget the local and Parish Councils who could have said NO to borrowed government money for their projects once the state of the nations finances were known.
They are just as out of touch.
As a nation we have plenty of money coming in but continue to spend more than this including giving it away.
What happened to thrift?
Also let us not forget the local and Parish Councils who could have said NO to borrowed government money for their projects once the state of the nations finances were known. They are just as out of touch. As a nation we have plenty of money coming in but continue to spend more than this including giving it away. What happened to thrift? ColdAsChristmas
  • Score: 0

8:57am Thu 27 Dec 12

CynicaloldGit says...

Thanks Perplexed
Thanks Perplexed CynicaloldGit
  • Score: 0

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