Sorry I should have added illiterate to that.

These graphs need treating very carefully, remember the one you are looking at is debt/GDP (total, not per capita) and so comparison with previous episodes is compicated by future projections of nominal GDP. Bear in mind that (a) Britain can’t simply increase its population several times over, which together with productivity growth ensures a massively expanded GDP and hence reduces the debt/GDP ratio [this is how the Napoleonic War peak was dissipated] and (b) we could choose to inflate our debt away [which is partly how the post-World War peak came down] but on your pension be it. It’s still a painful option and not likely to be a popular one in practice.

You’re correct to point out there is no need for “severe austerity for the rest of our lives” but that’s not being seriously discussed as an option anyway. The Coalition’s austerity programme is not an order of magnitude different to Darling’s, and both are completely different to the genuinely severe austerities being seen (imposed on? self-imposed even? take it as you will) in Greece and Ireland.

Finally a real kicker: if we can’t rely on population growth to boost nominal GDP and we don’t wish to rely on inflation (before anyone quotes the horrendous CPI/RPI figures we are actually talking about the GDP [de/in]flator statistics here), then we’re down to productvitiy growth. Although the “white heat of technology” burns brighter now than ever before, we are actually very unlikely to see the big gains in productivity experienced under the Industrial Revolution [ref Napoleonic War debts] or even from the massive spurt in productivity after WW2 [ref the World War debts]. This is for several reasons, not least that the replacement of modern technology with even moderner, doesn’t seem to have anything like the marginal effect on productivity that the replacement of medieval with mechanised modes of production did. Economists often debate why the era computerisation does not seem to have left a notable uptick in the productivity time series. (The fact it’s a workday and PB is as busy as ever may yield a clue!) Worse still, manufacturing seems to have higher long-run productivity gains than services, but Western economies are becoming more services oriented, so in the long-run expectations of productivity rises should fall.* There’s no simple answer to this; part of the reason manufacturing makes up a smaller part of the pie is that we only need/want so much “Stuff”, and it needs increasingly fewer jobs to produce it (IIRC manufacturing has to grow 3% p.a. just to keep the number of jobs static; a 2% rise in output would actually be accompanied by net layoffs!).

If we were able to experience the productivity growth of the Golden Years, we could happily budget for 5% GDP growth, the standard of living would increase massively, and debt would fall to more affordable levels as a % of GDP even if we ran a small deficit. But this ain’t going to happen, hence some level of pain is expected. Also note that the affordability of debt doesn’t depend just on its ratio to GDP, but also on the cost of servicing it – which comes down to interest rates, and hence the risk premium that lenders need to be bribed with to take British debt. When debt is, depending on how you measure it, around the 100% mark, then you need to be very careful about giving signals to the market that you are less than serious about tackling the deficit/debt, because a rise in interest rates would be devastating.

*(Similarly public sectors tend to experience smaller productivity gains than private sectors, and our mixed economies are becoming increasingly state-dominated, spelling bad news. However the public/private difference is at least partly attributable to the public sector being even more skewed towards services than the private sector is.)

Where is the sense of duty of the millions of people sitting at home unemployed on benefits for more than two years? Just as the wealthy already pay more in tax both in absolute terms and in percentage terms, the long term unemployed should be forced back into work.

It really does go both ways. Labour are all about soaking the rich while building up a client state of voters on benefits or in the public sector pushing paper about.

The working poor already pay very little in tax (as it should be) the cost is the amazing number of benefits the previous government paid out to its client state of unemployed people. Labour’s legacy is trillions in debt, millions of unemployed and long term fiscal austerity.

202, but Mr. Jonathan, excessive top taxation rates decrease the sum going to the Treasury. You can’t advocate spending and then introduce punitive taxation which reduces tax receipts. It doesn’t raise more money, but less, and the sole motivation is a desire to hammer the rich.

208, quite so, Mr. Max.

Jelly babies?

Sorry, MB, but Eire-ish(?) levels of cuts are coming here – it’s for once true to say ‘it’s only a question of how fast the cuts are made’.

a) the STRUCTURAL deficit is eliminated
b) then the deficit
b) then we run a fiscal surplus for 10, 20, 50, 100 years, all of 1-5% of State spending.

Which party you’re in decides which level of payback period you are most comfortable with. I’d accept 20 years, so a surplus around £200 billion pa would be about right – such as fully privatising the NHS, Soc Ser, and raising the pension age to 75 by 2030.

Depends whether you call that ‘austerity’, mind.

I heard that in the car and was astonished. I suspect it is a new form of non answer. Call me cynical but it is not a credible reply.

tories marry each other for security.
tories have children to get the inheritance.
tories employ their mates children
tories control the establihsment.

Have you looked at the top of the Labour party recently? Start with Mr & Mrs Balls, the Eagle sisters, the Miliband brothers and work down from there. Look who employed whom as interns and for 13 years that lot WERE the establishment.

the tories have put their own political power ahead of the countries interests

Are you stupid? Or do you think we are?

In my opinion, Labour gerrymandered our voting system and fiddled with immigration to ensure their own re-election. Brown spent £5bn we cannot afford on projects in his own constituency.

If ever there was a prime example of a party trashing the countries interests to ensure its own power then 13 years of Labour prove the case.

at least i can look in the mirror and say my vote is for the country not a vote for the small group that control the state and society.

So you do not vote Labour then?

Bev.

vote tory maintain the genepool.

I am beginning to think that the gene pool will be much improved if you do not contribute to it.

Bev.

Has Tim been posting from Sirte? Its gone very quiet.

So how would you get unemployed people to put something back into society? Right now it is firmly a one way street where taxpayers and the government give but receive little to nothing in return? I’m not talking about taxes either since taxing benefits is a pointless exercise.

i originally thought you were a labour staffer trolling the site however it is now clear due to the lack of logic and sense in your comments that you are actually a piece of software that is programmed to churn out meaningless “attack lines” at the tories. perhaps you were programmed by alistair campbell and fiona millar in their spare time for a joke?

it is very boring and not remotely clever.

Typical Labour – telling me what I can or cannot read. Into Edmund’s widget’s ‘Ignore’ list for you Katherine.

Bye

Bev.

I agree. Not sure which bunch of Whitehall staffers drew up the BR privatisation, but the companies should have been vertically integrated – just returned to the pre-1947 state.

With one proviso. Any firm can run any train on any track when it’s not being used by the parent company. Signalling to be upgraded within 10 years such that the minimum gap on any track between trains is minimum stopping distance x2.

[I'd guess it's currently round 50-500x perhaps way, way more]

I’d also state that all taxpayer’s subsidies OTHER than for London commuters (maybe a few others – but strictly commuter routes only) would end in, say 10 years.

What fares they charge is entirely up to them – no ‘OffRail’ and people then choose where to live, work, and how to travel between them.

Katherine; didn’t I see you on TV at Dale Farm, wearing a rather fetching balaclava ?

Here’s something to cheer Katherine up a bit (because the Tories were being defeated rather than Labour winning):

1997 election:
http://www.youtube.com/watch?v=5JttnDggWb8&amp

2001 election:
http://www.youtube.com/watch?v=6weF6Q37F2w&amp

2005 election:
http://www.youtube.com/watch?v=HfUwO4LAJLs&amp

I rather like the suggestion I read somewhere (here on PB perhaps?) that you get 10 years of benefits for an expected 40 year working life. When you have used up your 10 years you are on your own.

It could even be organised that you must make 3 years of contributions before getting one year of benefits.

Bev.

Max,
I rather like the idea of community service, a form of moral conscription for 18 year olds so they grow up and contribute a tad more to society.

I know the lefties will whinge, but doing something made me happy when I was that age on a volunteer basis, ( I taught mentally handicapped kids to swim) and if people do not similar through choice then they should be cajoled into helping others less fortunate.

Cleaning graffiti for those who should not have unsupervised human contact with those that are deemed needing help is also an option….
Less self esteem gained than if you truly help individuals and not society as a whole, but people have to start somewhere to het their lives organised to a minimum level.

On Hillsborough, the account I read at the time was that the FA executives told Thatcher to ignore the Taylor Report, saying roughly ‘You’re only a woman; you don’t understand football. Trust us, abolishing the terraces will ruin the game, and make all our fans angry with you.’

This, naturally, did not go down well. Not only did Thatcher implement the Taylor report; in some respects she went even further.

Now ask yourself, would Blair or Brown told the FA executives to get lost, or would they have wanted to show they were one of the boys?

LOL. That explains a lot. Woolly thinking is just as common in UKIP as any other party.

New Thread

Sorry HD2 but while I see that you’d like that to happen (or at least, your diagnosis is that it would be a necessary albeit unpleasant treatment) I just can’t see why you think it’s inevitable.

The idea that we need to run a fiscal surplus for decades is (a) not the recommendation of mainstream economists, (b) is not view of any of the major parties, (c) doesn’t seem to have polling support among the voters. Moreover to totally privatise NHS and Soc Ser (do you mean Soc Sec?) etc would be electoral suicide as it stands, and governments tend to do that kind of lemming-act only if they are being pushed towards it by forces beyond their control (as in Greece, Ireland).

Now there might be some reasons to think some of that is a good idea (in fact if you managed to reach the bottom of my boring screed you’ll see why there are arguably certain merits) but I can’t see any clear reason to think it’s inevitable, that the big parties are going to start supporting it, that they’ll overcome public resistance to it…

Anyway the screed wasn’t aimed at you. Just me venting my frustration at “evidence-based blogging”: i.e. the tendency to find a pretty graph/”killer stat” and only registering it as the vindication of pre-existing prejudices. Think, people. Critically bloody think. (What do the figures really mean? What parallels can we draw? What do we need to be skeptical or cautious about? Are there any contrary interpretations?) Or else the MBE will pop up and bore y’all to death. Slowly. But possibly, just sometimes, informatively.

That’s a myth. Mainly faeces and stones.

What do the figures really mean? What parallels can we draw? What do we need to be skeptical or cautious about? Are there any contrary interpretations?

MBE, you seem to think PB is akin to a tutorial.

In my view it is much closer to a bump supper.

And the latter is far more enjoyable, and better timed, for the idle.

I wonder if the EU vote’s advantage is it covers more things than simply the EU- also immigration and the economy to some extent? These have some real ‘dog whistle’ potential with C1s and C2s.

Nearly 30% of the population voted for Gordon Brown. Several thousand personally voted for Ed Balls…

Well, you don’t bore me, MBE.

There’s a tangental point I’d like to take up with you but don’t have time just now.

Catch you later – and thanks for the ‘tutorial’.

FPT
Jonathan Today 01:56 PM in reply to Max
“Personally I am of the view that everyone should pay something however small. We are one nation after all and should all have a stake in the govt and share of the burden. I accept this is a minority view, out of odds with your coalition partners and many in Labour.”

An admirable but very strange position to take for one of the left leaning fraternity. Was this point one of, if not the main reason for the introduction of the community charge?

It was then labelled the poll tax by the lefties I also seem to remember and they had a also had few punch ups in London town.