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Politics Today

fred binneys head

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Apr 1, 2004
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22,055
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Loving the boy Stanno
Liz Truss will see this through and, as Tavy has said, whether she will be proved correct will be seen in due course. The markets don’t like uncertainty, they never have of course, but particularly in recent years when the government’s modus operandi is to leak policy changes out in advance so the markets can price them in before they happen. This is the first time in a while we’ve had a ‘budget’ where no one knew exactly what was coming. It’s no surprise the markets were spooked, particularly with the backdrop of Ukraine and the clustercfuk that’s causing.

I think what the government has done is wrong because I’m a yoghurt-knitting leftie 😉 but can understand why others who believe trickle-down economics works would agree with them. But even if I pretend I’ve got an impartiality hat to wear, they’ve been naive in the extreme. They’ll see it through because they have to, but if this is a sign of what’s to come from the government under Liz Truss then we’re in for a rocky ride. I hope she learns from this, or doesn’t so Labour win the next election 😉
 

cannockred

Active member
Joined
Sep 23, 2007
Messages
1,303
Location
Looking forward....
Liz Truss will see this through and, as Tavy has said, whether she will be proved correct will be seen in due course. The markets don’t like uncertainty, they never have of course, but particularly in recent years when the government’s modus operandi is to leak policy changes out in advance so the markets can price them in before they happen. This is the first time in a while we’ve had a ‘budget’ where no one knew exactly what was coming. It’s no surprise the markets were spooked, particularly with the backdrop of Ukraine and the clustercfuk that’s causing.

I think what the government has done is wrong because I’m a yoghurt-knitting leftie 😉 but can understand why others who believe trickle-down economics works would agree with them. But even if I pretend I’ve got an impartiality hat to wear, they’ve been naive in the extreme. They’ll see it through because they have to, but if this is a sign of what’s to come from the government under Liz Truss then we’re in for a rocky ride. I hope she learns from this, or doesn’t so Labour win the next election 😉
Fred, for a yoghurt knitting leftie, that is an honest and truthful response without recourse to the usual insults.

As you say, we have to see what happens in the short term future especially considering the weakness of the majority of world currencies.
 

Spanks

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Joined
Jul 9, 2019
Messages
1,504
Fred, for a yoghurt knitting leftie, that is an honest and truthful response without recourse to the usual insults.

As you say, we have to see what happens in the short term future especially considering the weakness of the majority of world currencies.
Whilst the movement of the pound was the headline grabber (it's back to pre budget, not budget levels), it's the changes in the gilt market that has royally screwed everyone, and that isn't changing back.

The pound has only stabilised because the market is pricing in interest rates hitting 6% next spring. That'll mean most mortgage renewals at 8%-ish. Whilst that'll make Jinxy happy, the hundreds of thousands of people about to find out that their homes are no longer affordable, aren't going to be.
 

elginCity

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Jul 29, 2004
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Swindon
The bollack she dropped was underestimating the market reaction, she probably won’t backtrack on something she truly believes will work, which it may very well do.
Rishi Sunak repeatedly warned Truss of a market reaction - that higher inflation and mortgages would result from her standout campaign policy during the debates. Not quite as convinced as yourself that she truly believes in the red meat she threw out there to the blue rinse and blazers to get herself elected as PM, and is now ‘delivering’. Deliver, deliver, deliver remember.

Johnsonian repeated u-turns were considered weak whereas the lady who was not for turning strong. We all know who Truss models herself upon, but in this instance a u-turn would have probably been advisable.
 

tavyred

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Aug 23, 2004
Messages
13,901
Those geniuses at the BoE prediction that the U.K. was already in recession lasted about a fortnight before it was shown to be bollacks.🙄
Q2 GDP revised upwards from a 0.1 contraction to 0.2 growth.
 

lamrobhero

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Joined
May 31, 2018
Messages
1,303
Location
Hangingstone Hill
The belief that taxes need to be low enough to encourage innovation / entrepreneurship is a truism. What is worrying about modern right wing politics is that there is no lower limit, no evidence base, no recognition of the other ingredients needed for a successful economy/soiciety, no recognition of the historic failure of toff/oligarchs to invest. The internet was not invented by an entrepreneur.
Modern right wing politics is a self serving ideology and the results will be disastrous.
 

arthur

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Joined
Aug 18, 2004
Messages
11,479
The belief that taxes need to be low enough to encourage innovation / entrepreneurship is a truism. What is worrying about modern right wing politics is that there is no lower limit, no evidence base, no recognition of the other ingredients needed for a successful economy/soiciety, no recognition of the historic failure of toff/oligarchs to invest. The internet was not invented by an entrepreneur.
Modern right wing politics is a self serving ideology and the results will be disastrous.
Absolutely. Tavy's "it might well work" is based on this truism.. Spraying money around hoping some if it ends up being invested in growing the UK economy long term wilfully ignores what happens in the real world.

"But who thinks that restoring national insurance rates to 2021 levels and cancelling the planned increase in corporation tax is going to unleash more growth? Despite Truss and Kwarteng’s overconfident claims, there is not a scintilla of evidence that tax cuts “trickle down” to impart economic dynamism, extra effort or enterprise. Growth instead comes from the application of inventiveness, via the efforts of thousands of firms and millions of people using the gifts the gods gave them, to make the world better – and from which profits flow. Economic growth is the product of complex economic and social organisations marshalling these impulses around a shared purpose."

Labour's alternative, a growth plan based around greening the economy and energy self sufficiency, is such an example of a shared purpose. This is not to say it is morally superior, just that it is far more likely to work

 

angelic upstart

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Jul 8, 2004
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27,486
"But who thinks that restoring national insurance rates to 2021 levels and cancelling the planned increase in corporation tax is going to unleash more growth? Despite Truss and Kwarteng’s overconfident claims, there is not a scintilla of evidence that tax cuts “trickle down” to impart economic dynamism, extra effort or enterprise. Growth instead comes from the application of inventiveness, via the efforts of thousands of firms and millions of people using the gifts the gods gave them, to make the world better – and from which profits flow. Economic growth is the product of complex economic and social organisations marshalling these impulses around a shared purpose."

Labour's alternative, a growth plan based around greening the economy and energy self sufficiency, is such an example of a shared purpose. This is not to say it is morally superior, just that it is far more likely to work
I'll be £30 a month better off according to https://www.thesalarycalculator.co.uk/salary.php How many people will have lost more than that on the utility price rise tomorrow? My wife will be £15 a month better off, but again wiped out by the utility rise.
I cannot see any extra spending for the vast majority of UK people.

Business will possibly save a little, but the cost of borrowing is rising so I can't see them suddenly deciding to change whatever course they were taking beforehand.

Then we have the 150K which will have genuinely more money in their pocket, but I'm told it's only 2 billion. So barely any ROI on massive tax cuts and what is likely to be a slashing of our already fairly impoverished services.

Labour's alternative, I'm not personally too keen on, however, it's a reasonably new idea and will create jobs.
 

Alistair20000

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May 5, 2009
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Avoiding the Hundred
Modern right wing politics is a self serving ideology and the results will be disastrous.
Exactly the same is true of left wing ideology.
 

Alistair20000

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Joined
May 5, 2009
Messages
52,234
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Avoiding the Hundred
Liz Truss will see this through and, as Tavy has said, whether she will be proved correct will be seen in due course. The markets don’t like uncertainty, they never have of course, but particularly in recent years when the government’s modus operandi is to leak policy changes out in advance so the markets can price them in before they happen. This is the first time in a while we’ve had a ‘budget’ where no one knew exactly what was coming. It’s no surprise the markets were spooked, particularly with the backdrop of Ukraine and the clustercfuk that’s causing.

I think what the government has done is wrong because I’m a yoghurt-knitting leftie 😉 but can understand why others who believe trickle-down economics works would agree with them. But even if I pretend I’ve got an impartiality hat to wear, they’ve been naive in the extreme. They’ll see it through because they have to, but if this is a sign of what’s to come from the government under Liz Truss then we’re in for a rocky ride. I hope she learns from this, or doesn’t so Labour win the next election 😉
Just one thing I would disagree with here.

All the tax cuts apart from one were pre trailed: NIC & Corporation Tax. The support for energy bills was also pre trailed. The only add on was the 45% tax cut that costs £2.2 billion per annum out of total government tax receipts of over £700 million. Not enough of itself to spook the markets. Maybe the promise of further unfunded tax cuts was the tipping point.
 
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