A Different Form Of Indexation

[Quicken]

As we all know, various government spending components (e.g. Pensions, LHA) are linked to inflation indices (RPI or CPI). As I see it, there are two main problems with this approach:

1) The inflation figures can be fiddled.

2) Spending is not directly proportional to income (which it should be for a balanced budget).

Taking these factors into account, here is my suggestion for a sustainable long-term policy: link government spending components, not to an inflation index, but to the tax take in the previous year. With this form of indexation, it might be possible to go further and set the total budget for the current year to be the tax take from the previous year. Thus, growth would produce a modest surplus, while contraction would allow for modest stimulus spending.

What do you think?

Cheers,

Q

[24gray24]

[quote

What do you think?

Cheers,

Q

You are making a fundamental error IMO. You are assuming the government wants to be efficient and good, and are therefore constantly puzzled why the government constantly does things that are not sensible.

For example bank of england not stopping the banks earlier, UK going to war in Afghanistan, selling gold reserves in 2001 etc.

Why not try a different assumption: that we are being deliberately cheated by evil men. Then it all makes more sense: Boe was in on it, Afghanistan was big profit for arms merchants, rich men wanted to buy the gold at historic lows etc .

[Lepista]

You are making a fundamental error IMO. You are assuming the government wants to be efficient and good, and are therefore constantly puzzled why the government constantly does things that are not sensible.

For example bank of england not stopping the banks earlier, UK going to war in Afghanistan, selling gold reserves in 2001 etc.

Why not try a different assumption: that we are being deliberately cheated by evil men. Then it all makes more sense: Boe was in on it, Afghanistan was big profit for arms merchants, rich men wanted to buy the gold at historic lows etc .

Indeed - occams razor says so.

[pilchardthecat]

Indeed - occams razor says so.

Agreed. I'm not normally one for conspiracy theories, but there isn't any other theory that's even remotely plausible

[Quicken]

Thanks for the responses so far. I am trying to think about how the system should work, based on criteria of sustainability and simplicity. Perhaps I am being naive, but maybe The TaxPayers' Alliance would be interested.

Q

[pilchardthecat]

Thanks for the responses so far. I am trying to think about how the system should work, based on criteria of sustainability and simplicity. Perhaps I am being naive, but maybe The TaxPayers' Alliance would be interested.

Q

The system works fine

When you realise who it works for

[Lepista]

Now all you need to do is to come up with a fair way to collect taxes.

[swissy_fit]

The system works fine

When you realise who it works for

Precisely.

If you propose anything that would actually make it fairer or in the interests of the masses, then you'll be discredited by a mass of vested interests, if that failed, they'd suborn you, if that failed, they'd kill you.

The only way is to kill them, or frighten them enough to make them back off for a generation or two. You need tanks and missiles, not Taxpayers Alliances.

[rantnrave]

On other forums, HPC posters have a reputation for being doom merchants, paranoid, cynical, tin foil hat folk etc. After reading this thread, I'm starting to wonder if they have a point...

[Quicken]

Now all you need to do is to come up with a fair way to collect taxes.

True, and I support LVT, but that is a separate issue. My suggestion is just about responsible/sustainable government spending.

Q

[swissy_fit]

On other forums, HPC posters have a reputation for being doom merchants, paranoid, cynical, tin foil hat folk etc. After reading this thread, I'm starting to wonder if they have a point...

Yeah, and I'm one of the fairly rational ones!

OK, explain how you will break the power of the banks in a non-violent way.

[scottbeard]

Indeed - occams razor says so.

No - occam's razor says that if people do stupid things it's because they're stupid, not because they're part of a global conspiracy

[rantnrave]

Yeah, and I'm one of the fairly rational ones!

OK, explain how you will break the power of the banks in a non-violent way.

Bring back Ghandi to orchestrate something...

I spend a lot of time over on the EA Today site to see how they regard the market's future. However, with my HPC glasses on, I often find myself instead alarmed at the opinions expressed over there (mostly their ignorance). Now I wonder how HPC threads read to those outside of this forum who have discovered it for the first time. Do we come across as the informed voice of reason that is likely to see them embrace our points of view?

[swissy_fit]

Bring back Ghandi to orchestrate something...

I spend a lot of time over on the EA Today site to see how they regard the market's future. However, with my HPC glasses on, I often find myself instead alarmed at the opinions expressed over there (mostly their ignorance). Now I wonder how HPC threads read to those outside of this forum who have discovered it for the first time. Do we come across as the informed voice of reason that is likely to see them embrace our points of view?

Ghandi?

The banksters would eat him up these days, their political and population management skills have been improved dramatically since that era, he'd be portrayed as a crackpot troublemaker in no time, his protest movement would be infiltrated and all demos would end in looting and violence, putting off the majority.

No we probably don't come across as the informed voice of reason, what with racist posts being permitted (see recent thread about Chicago) plus the lunatic fringe with their NWO and lizard references, but as I believe only a mob stringing up some banksters/politicos or an Oliver Cromwell throwing out Parliament will help, it doesn't matter much.

[pilchardthecat]

No - occam's razor says that if people do stupid things it's because they're stupid, not because they're part of a global conspiracy

But they aren't doing stupid things; they are amassing vast amounts of personal wealth and power, and are doing so with great success.

[scottbeard]

But they aren't doing stupid things; they are amassing vast amounts of personal wealth and power, and are doing so with great success.

Well that's just it, they aren't.

Gordon Brown? Out of power. Sir Fred Goodwin? Hounded into retirement and forced to hand back some of his pension. The big banks are mostly nationalised and most have laid off bankers. Lehman Brothers disappeared altogether.

Governments are beginning to unravel, starting with the PIIGS and moving to the UK and US before too long.

I keep reading nonsense about "the elite" organising crashes and hyperinflation, when those are the exact things that rob them of their wealth and power.

"The elite" did nicely out of the boom. They are not doing nicely out of the bust because they didn't understand it was coming, didn't want it and don't know how to deal with it. The only sad thing is they have taken half the world down with them in their stupidity.