Cameron: "Cuts will change our way of life"

[Jose Jones]

As Britain's economy is quite strongly based on people buying things it's probably not the best idea to tax the shit out of people so that they can't afford to buy things.

 

Weird stuff this from Dave.

 

The main immediate danger to the British economy is panicking the markets so that there is a run away from the FTSE and the pound. Which in turn will panic the rating agencies (themselves a strange concept) to lower Britain's rating.

Also if you're going to cut public service jobs, you're going to need companies to fill the gap to provide jobs and services - and also companies from overseas to invest in the UK and employ people. It's hardly the best way to attract companies from outside to go "Aaaahh the country's going to be fucked for decades!!! We'll be eating shoes soon!!"

[JER]

This letter has it about right

 

Let me just make sure I've got this right. First of all, a bunch of bankers lose unimaginable amounts of our money by making bets on a bunch of dodgy mortgages. Eventually the banks realise the bets are based on worthless assets, and that technically they are bankrupt.

 

The government bails them out with billions of pounds, transferring the debt to the public sector. The bankers, full of gratitude, pay themselves multimillion-pound bonuses which they invest in such a way as to pay as little tax as possible.

 

We express our anger by voting out the government and replacing it with a new one, which promptly blames the debt on the profligate spending of its predecessor, and tells us that the only solution is to cut public services. Civil servants lose their jobs, unemployment rises, libraries are closed, support services for the very poor, the dispossessed and the desperate disappear. Those who caused this mess in the first place get away with it, and are probably already planning the next disaster.

 

Are we really that gullible?

 

Matt Nicholson

 

Bristol

[Section_31]

^^ agreed. As I've said many times on here, the 'top layer' of people in the Uk and USA are 'global' to a quite unprecedented degree. Unlike Chinese and Japanese and European businessmen who link their actions with a healthy dose of patriotism, the people at the top here really, really don't care if the country burns. This goes for people like Mandelson, Blair, Osborne the 'political class', most of the media, bankers, and business. To them, the United Kingdom is little more than a framework to exploit, and when they're finished they'll move somewhere else like a plague of locusts.

[Guest Numero Veinticinco]

This letter has it about right

 

Let me just make sure I've got this right. First of all, a bunch of bankers lose unimaginable amounts of our money by making bets on a bunch of dodgy mortgages. Eventually the banks realise the bets are based on worthless assets, and that technically they are bankrupt.

 

The government bails them out with billions of pounds, transferring the debt to the public sector. The bankers, full of gratitude, pay themselves multimillion-pound bonuses which they invest in such a way as to pay as little tax as possible.

 

We express our anger by voting out the government and replacing it with a new one, which promptly blames the debt on the profligate spending of its predecessor, and tells us that the only solution is to cut public services. Civil servants lose their jobs, unemployment rises, libraries are closed, support services for the very poor, the dispossessed and the desperate disappear. Those who caused this mess in the first place get away with it, and are probably already planning the next disaster.

 

Are we really that gullible?

 

Matt Nicholson

 

Bristol

 

Yep, I'm with Matt on that one. I've been saying the same thing myself over the last few days. I think I already mentioned that before the banking crisis, we had a manageable 3% deficit, so it seems strange that people would go so manic against the public sector. Is there waste, of course, SD mentioned a few rather small things. That wastage needs to be cut, of course, but pretending it's responsible for the deficit is a joke.

[melons]

Clegg and Cameron spit roast.

 

 

 

 

 

 

Didn't want that mental image did you?

What did i ever do wrong to you to give me that? *shudders*

 

Personally I'd cut tax credits, benefits, family allowance, raise VAT and income tax. Hit everybody.

Too many scroungers with sky and all inclusive holidays.

 

Dead clever that, would that be to keep the scally's where they belong and not give anyone that would be dependent on those benefits a chance of getting out of the perpetual cycle? British class system at it's finest.

 

This letter has it about right

 

Let me just make sure I've got this right...

Spot on.

[Redder Lurtz]

Yep, I'm with Matt on that one. I've been saying the same thing myself over the last few days. I think I already mentioned that before the banking crisis, we had a manageable 3% deficit, so it seems strange that people would go so manic against the public sector. Is there waste, of course, SD mentioned a few rather small things. That wastage needs to be cut, of course, but pretending it's responsible for the deficit is a joke.

 

Hang on though - Didn't Brown borrow heavily (against the advice of the opposition I think) in order to finance fiscal stimulus? Spend your way out of recession by borrowing money, right? The public sector department with whom I work were told to get rid of a very significant hike in budgetary increase. I know for sure that some of that money was spent in a disgracefully wasteful manner and that the orders to do so were handed down from a ministerial level. This is where the huge deficit came from which we're now paying back, no?

 

Someone educate me here, too. Why is it that Cameron can't just go after the banks who apparently owe billions in unpaid takes? And none of this 'they're all Tory Dave's mates' bollocks. There must be economic reasons and I'd like to know what they are.

[Stu Monty]

Hang on though - Didn't Brown borrow heavily (against the advice of the opposition I think) in order to finance fiscal stimulus? Spend your way out of recession by borrowing money, right? The public sector department with whom I work were told to get rid of a very significant hike in budgetary increase. I know for sure that some of that money was spent in a disgracefully wasteful manner and that the orders to do so were handed down from a ministerial level. This is where the huge deficit came from which we're now paying back, no?

 

Someone educate me here, too. Why is it that Cameron can't just go after the banks who apparently owe billions in unpaid takes? And none of this 'they're all Tory Dave's mates' bollocks. There must be economic reasons and I'd like to know what they are.

 

This is the economics: if you want to get elected then don't piss off the people who pay for the tv slots and the billboards. Government, like anything else, can be bought and sold and is subserviant to money.

[Redder Lurtz]

This is the economics: if you want to get elected then don't piss off the people who pay for the tv slots and the billboards. Government, like anything else, can be bought and sold and is subserviant to money.

 

So what you're saying then Stu, is it's because they're Dave's mates then, yeah? I see. Well you've answered one question although not the one I asked.

 

 

 

 

By the way, excuse the error in my previous post - 'takes' was supposed to be 'taxes.' Freudian typo.

 

And seriously, there was something on the radio a couple of days ago about the financial institutions owing tens of billions in unpaid taxes. What are the economic constraints preventing that money from being collected? Genuine question to anyone who genuinely has an answer and not just a socialist chip on their shoulder.

[Section_31]

This is the economics: if you want to get elected then don't piss off the people who pay for the tv slots and the billboards. Government, like anything else, can be bought and sold and is subserviant to money.

 

Particularly Russian money. Alegedly.

[dennis tooth]

So what you're saying then Stu, is it's because they're Dave's mates then, yeah? I see. Well you've answered one question although not the one I asked.

 

 

 

 

By the way, excuse the error in my previous post - 'takes' was supposed to be 'taxes.' Freudian typo.

 

And seriously, there was something on the radio a couple of days ago about the financial institutions owing tens of billions in unpaid taxes. What are the economic constraints preventing that money from being collected? Genuine question to anyone who genuinely has an answer and not just a socialist chip on their shoulder.

 

As Stu pointed out, they cannot take them on because they are multinational for a start. Also you seem to be missing the point of capitalism which is the transfer of money from the bottom to the top and have fell for the 'tickle down' myths. Given that Cameron is completely inbedded in that environment and is all he has known all his life we have more chance of Alhaminijad converting to Jewery than Cameron going agains the nature of his role which is to faccilitate the transfer of money from the bottom to the top or face a huge media backlash led by the same small group of elites in charge here.A genuine answer even if you don't like it-there it is.

[Redder Lurtz]

As Stu pointed out, they cannot take them on because they are multinational for a start. Also you seem to be missing the point of capitalism which is the transfer of money from the bottom to the top and have fell for the 'tickle down' myths. Given that Cameron is completely inbedded in that environment and is all he has known all his life we have more chance of Alhaminijad converting to Jewery than Cameron going agains the nature of his role which is to faccilitate the transfer of money from the bottom to the top or face a huge media backlash led by the same small group of elites in charge here.A genuine answer even if you don't like it-there it is.

 

He didn't but ok.

 

So the British tax payer propped up multinational financial institutions? Surely we didn't pay money into, say, a Dubai based finance house because their Brit branches were failing and they've now fucked off with the money we gave them?

[Anubis]

This letter has it about right

 

Let me just make sure I've got this right. First of all, a bunch of bankers lose unimaginable amounts of our money by making bets on a bunch of dodgy mortgages. Eventually the banks realise the bets are based on worthless assets, and that technically they are bankrupt.

 

The government bails them out with billions of pounds, transferring the debt to the public sector. The bankers, full of gratitude, pay themselves multimillion-pound bonuses which they invest in such a way as to pay as little tax as possible.

 

We express our anger by voting out the government and replacing it with a new one, which promptly blames the debt on the profligate spending of its predecessor, and tells us that the only solution is to cut public services. Civil servants lose their jobs, unemployment rises, libraries are closed, support services for the very poor, the dispossessed and the desperate disappear. Those who caused this mess in the first place get away with it, and are probably already planning the next disaster.

 

Are we really that gullible?

 

Matt Nicholson

 

Bristol

 

 

Can't argue with that. I'm sure SD can though. Over to you SD.

[Cardie]

Yeah Dave, I'm sure cuts will change YOUR way of life.

 

Thatcher has promised to make him immortal if he pulls it off so it will change his life to be fair.

[Stu Monty]

So what you're saying then Stu, is it's because they're Dave's mates then, yeah? I see. Well you've answered one question although not the one I asked.

 

 

No Lurtz, I didn't say that at all. And I answered the question you asked with the point most relevant. You can come up with as many fancy economic reasons why things won't happen or shouldn't happen but the main point is that to get elected they need money. And fucking about with the people with the most money might mean they give you less of it. It's not a party political point, all parties are in the same boat; it's just that not all parties ideologies wank themselves silly over how great it is.

 

It's not fucking rocket science.

[King Emlyn]

Massive deficit you say? Cool, get the banks to pay it.

[King Emlyn]

Yeah Dave, I'm sure cuts will change YOUR way of life.

This. The ghost of Keith Joseph looms large.

[BatChainPuller]

Cameron said the country was "paying the price" for the fact that the size of the public sector had got "way out of step" with that of the private sector.

 

Public sector workers had been "insulated" from the harsh realities of the recession while everyone else was paying the price, he said.

 

A prime example of pissing up your back and trying to tell you it's raining.

 

Should be blindingly obvious that whole country is paying the price for insulating financiers from the realities of their own failure. The fact that he would use the cost of nationalising private debts to deliver a lecture on high public spending tells you what a deceitful cunt he is. Ideologically-driven spite - traditionalism Toryism with a little help from the smurfs.

[Section_31]

A prime example of pissing up your back and trying to tell you it's raining.

 

Should be blindingly obvious that whole country is paying the price for insulating financiers from the realities of their own failure. The fact that he would use the cost of nationalising private debts to deliver a lecture on high public spending tells you what a deceitful cunt he is. Ideologically-driven spite - traditionalism Toryism with a little help from the smurfs.

 

I get the feeling the credit crunch will be the Tories' 9/11. Just as it gave the Republicans carte blanche to unleash their domestic and foreign agenda, I think this will provide the Tories with the excuse to do the things they've always wanted to do.

 

I wouldn't be surprised if we see whole Government and state departments privatised, with the like of the Job Centre being run for profit based on how many people it can force into picking parsnips for £3 an hour.

[BatChainPuller]

I get the feeling the credit crunch will be the Tories' 9/11. Just as it gave the Republicans carte blanche to unleash their domestic and foreign agenda, I think this will provide the Tories with the excuse to do the things they've always wanted to do.

 

I wouldn't be surprised if we see whole Government and state departments privatised, with the like of the Job Centre being run for profit based on how many people it can force into picking parsnips for £3 an hour.

 

 

I fear you are right - exactly what Naomi Klein refers to in 'The Shock Doctrine'.

[King Emlyn]

I get the feeling the credit crunch will be the Tories' 9/11. Just as it gave the Republicans carte blanche to unleash their domestic and foreign agenda, I think this will provide the Tories with the excuse to do the things they've always wanted to do.

 

I wouldn't be surprised if we see whole Government and state departments privatised, with the like of the Job Centre being run for profit based on how many people it can force into picking parsnips for £3 an hour.

Funnily enough somebody said the exact same thing today. The greater the debt the more they will be lapping it up; think of all those lovely public sector services they can butcher and then turn around and say "Not our fault Guv" as they handsomely reward the private sector chancers for providing cack services at cheaper cost , they'll be rubbing their hands. The Tories are utter filth, always have been, always will be.

[dennis tooth]

They are not even running the economy now anyway, it's all been passed to the big businessmen to tear through.

[Anubis]

Funnily enough somebody said the exact same thing today. The greater the debt the more they will be lapping it up; think of all those lovely public sector services they can butcher and then turn around and say "Not our fault Guv" as they handsomely reward the private sector chancers for providing cack services at cheaper cost , they'll be rubbing their hands. The Tories are utter filth, always have been, always will be.

 

It's never cheaper in the end though.

 

About a month back we had a seminar at the Crown Court about the contribution based legal aid that's just come into force. There was a minion from the Ministry of Justice present. The contributions people are expected to pay will be collected by a private firm. I asked how they'd got the contract, and he said that their bid was less than the Legal Services Commission (who administer legal aid) could do it for. Some more judicious questioning brought out the fact that basically they are a firm of bailiffs.

 

I pointed out to him that they'd basically contracted out to the lowest bid, and asked why when that method has so clearly failed in the past - Every PFI project, NHS consolidated medical records, the Child Support Agency computer, University Admissions, in fact just about every government funded computer system in existence. I pointed out that in every case the low bids are for an unsustainable amount, but that once the contract was ordered they were over a barrel when the private contractor says they've run out of funding and will stop - at which point it becomes pretty much the highest bid.

 

PFI fucks me off the most. There were actually sanctions where the Government could take contractors to court and fine them for not fulfilling contracts. And in every case the Government caved like shithouses, and just paid them more money to finish the project.

[dennis tooth]

PFI's are the reason for many ills

[Redder Lurtz]

 

PFI fucks me off the most. There were actually sanctions where the Government could take contractors to court and fine them for not fulfilling contracts. And in every case the Government caved like shithouses, and just paid them more money to finish the project.

 

That's quality. There are a number or sections of motorway across the country which are built by private firms, repaid over 20 years or so by public funds in big fat monthly payments. These payments are reduced if congestion reaches a certain level. In the event of that happening, though, the scheme owner will present a business case for investment for congestion reduction schemes, which have to be accepted as there's no other option than to watch congestion get worse and worse. The investment is always taken from the taxpayer of course. Utterly ridiculous.

[Jose Jones]

So what you're saying then Stu, is it's because they're Dave's mates then, yeah? I see. Well you've answered one question although not the one I asked.

 

 

 

 

By the way, excuse the error in my previous post - 'takes' was supposed to be 'taxes.' Freudian typo.

 

And seriously, there was something on the radio a couple of days ago about the financial institutions owing tens of billions in unpaid taxes. What are the economic constraints preventing that money from being collected? Genuine question to anyone who genuinely has an answer and not just a socialist chip on their shoulder.

 

I think the economic argument is "oh we can't ask the banks to pay it back, because it might make them lose value and destabilise the economy, or worse the top bankers will leave and go to Switzerland".

 

Which makes no sense really, especially considering the US banks propped up by the government had to pay all the money back. And it makes even less sense when your plan is to raise taxes, cut jobs and services which is even more likely to destabilise the economy. There was a good article in the paper today actually:

 

Most of those responsible wreaking havoc on the global economy have not owned up to their failures, writes Joseph Stiglitz.

 

IT HAS taken almost two years since the collapse of Lehman Brothers and more than three years since the beginning of the global recession brought on by the misdeeds of the financial sector, for the United States and Europe finally to reform financial regulation.

 

Perhaps we should celebrate these regulatory victories. After all, there is almost universal agreement that the crisis the world is facing today - and is likely to continue to face for years - is as a result of the excesses of the deregulation movement begun under Margaret Thatcher and Ronald Reagan 30 years ago.

 

Unfettered markets are neither efficient nor stable.

 

But the battle, and even the victory, has left a bitter taste. Most of those responsible for the mistakes - whether at the US Federal Reserve, the US Treasury, Britain's Bank of England and Financial Services Authority, the European Commission and European Central Bank, or in individual banks - have not owned up to their failures.

 

Banks that wreaked havoc on the global economy have resisted doing what needs to be done. Worse still, they have received support from the Federal Reserve, which one might have expected to adopt a more cautious stance, given the scale of its past mistakes.

 

This is important not just as a matter of history and accountability, but because much is being left up to regulators. And that leaves open the question: can we trust them? To me, the answer is an unambiguous ''no'', which is why we need to hard-wire more of the regulatory framework. The usual approach - delegating responsibility to regulators to work out the details - will not suffice.

 

And that raises another question. Whom can we trust? On complex economic matters, trust had been vested in bankers (if they make so much money, they obviously know something!) and in regulators, who often (but not always) came from the markets. But the events of recent years have shown that bankers can make megabucks, even as they undermine the economy and impose massive losses on their own firms.

 

Bankers have also shown themselves to be ''ethically challenged''. A court of law will decide whether Goldman Sachs' behaviour - betting against products that it created - was illegal. But the court of public opinion has already rendered its verdict on the far more relevant question of the ethics of that behaviour. That Goldman's CEO saw himself as doing ''God's work'' as his firm sold short products that it created, or disseminated scurrilous rumours about a country where it was serving as an ''adviser'', suggests a parallel universe, with different mores and values.

 

As always, the financial-sector lobbyists have laboured hard to make sure that the new regulations work to their employers' benefit. As a result, it will likely be a long time before we can assess the success of whatever law the US Congress ultimately enacts.

 

The new law must curb the practices that jeopardised the entire global economy, and reorientate the financial system towards its proper tasks: managing risk, allocating capital, providing credit (especially to small and medium-sized enterprises), and operating an efficient payments system.

 

We should toast the likely successes. Some form of financial-product safety commission will be established, more derivative trading will move to exchanges and clearing houses from the shadows of the murky ''bespoke'' market, and some of the worst mortgage practices will be restricted.

 

It also looks likely that the outrageous fees charged for every debit transaction - a kind of tax that fills only the banks' coffers - will be curtailed.

But the likely failures are equally noteworthy. The problem of too-big-to-fail banks is now worse than it was before the crisis. In the last crisis, US government ''blinked'', failed to use the powers that it had, and needlessly bailed out shareholders and bondholders because it feared that doing otherwise would lead to economic trauma. As long as there are banks that are too big to fail, it will most likely ''blink'' again.

 

It is no surprise that the big banks have succeeded in stopping some essential reforms; what was a surprise was a provision in the US Senate's bill that banned government-insured entities from underwriting risky derivatives. Such underwriting distorts the market, giving big banks a competitive advantage, not necessarily because they are more efficient, but because they are ''too big to fail''.

 

The Fed's defence of the big banks - that it is important for borrowers to be able to hedge their risks - reveals the extent to which it has been captured.

There are many ways of curbing the excesses of the big banks. A strong version of the so-called Volcker Rule (designed to force government-insured banks to return to their core mission of lending) might work. But the US government would be remiss to leave things as they are.

 

The Senate bill's provision on derivatives is a good litmus test: the Obama administration and the Fed, in opposing these restrictions, have clearly lined up on the side of big banks. If effective restrictions on the derivatives business of government-insured banks (whether actually insured, or effectively insured because they are too big to fail) survive in the final version of the bill, the general interest might indeed prevail over special interests, and democratic forces over moneyed lobbyists.

 

But if, as most pundits predict, these restrictions are deleted, it will be a sad day for democracy - and a sadder day for the prospects of meaningful financial reform.

 

Joseph E. Stiglitz is University Professor at Columbia University and a Nobel laureate in Economics.