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Britain's Truly Shocking Deficit: Telegraph

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http://www.telegraph.co.uk/finance/economics/11177862/It-is-truly-shocking-that-our-already-huge-budget-deficit-is-still-growing.html

Twice that of our European cousins and we call this austerity at a time when the economy is growing strongly to boot.

Appeasement of the entitled moaning electorate is everything imo. This is not austerity it is living beyond our means on our credit card.

Edited by crashmonitor

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There's never been any austerity. 'Austerity' sure as hell isn't tax credits.

It just suited the Tories to talk austerity to please their voters/markets, and it suited Labour to talk about 'savage cuts' to appease their voters. Neither side had anything to gain by use of the truth.

Edited by EUBanana

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It's not money in the sense that ordinary people think. It's some digits made up out of thin air and bought by the world financial elites. As long as they can fool the rest of the world it's worth something what's the worry.

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Ed Balls may appear to have lost the argument but actually we have followed his plan B to the letter, run the largest deficit in Europe and won the race for growth.

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You cannot underestimate the power of a few Thatcheriteish soundbites in convincing Osborne's target voter bloc to swallow pretty much any hare-brained policy he comes up with, irrespective of its 'conservative' credentials.

So when Osborne talks about Help to Buy in terms of giving young people "the same housing opportunities that people's parents had", there are plenty who applaud him for it. Just so happens many of them benefit from telephone number asset prices so the flimsiest of excuses will do.

They talk about raw GDP as part of the post-crisis recovery in the same way but omit to mention the per capita situation- well down. IDS is the same with Universal Credit, but we've learned here that it is window dressing at best.

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Ed Balls may appear to have lost the argument but actually we have followed his plan B to the letter, run the largest deficit in Europe and won the race for growth.

Balls is hilarious.

We need to borrow more to fund growth.

The lack of growth has meant the coalition has had to borrow more.

Its like one side of his brain isn't talking to the other.

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Balls is hilarious.

We need to borrow more to fund growth.

The lack of growth has meant the coalition has had to borrow more.

Its like one side of his brain isn't talking to the other.

I don't think you've followed!!!!

If we'd have borrowed more we'd have had stronger growth meaning more tax receipts, however because we haven't borrowed enough to fund growth we've had borrow more to make up for the lack of growth and hence tax receipts.

Is this clear? :P

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I don't think you've followed!!!!

If we'd have borrowed more we'd have had stronger growth meaning more tax receipts, however because we haven't borrowed enough to fund growth we've had borrow more to make up for the lack of growth and hence tax receipts.

Is this clear? :P

ah, that must be it. It isn't the borrowing or money supply that matters, its what you say you're going to do with it :lol:

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I don't think you've followed!!!!

If we'd have borrowed more we'd have had stronger growth meaning more tax receipts, however because we haven't borrowed enough to fund growth we've had borrow more to make up for the lack of growth and hence tax receipts.

Is this clear? :P

Balls's extra borrowing was demonstrated in 2004/5 when house prices faltered, and Brown's rhetoric changed from "balancing the budget" to "balancing the budget over the economic cycle, but borrowing more to pull us out of a dip".

That 2004/5 Ballsian stimulus was probably the point of no return, after which an ordinary recession was no longer an option to correct the economy.

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It's not money in the sense that ordinary people think. It's some digits made up out of thin air and bought by the world financial elites. As long as they can fool the rest of the world it's worth something what's the worry.

And that Johnny, is why we must all vote Labour next time.

Now, lights out....

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Twice the national debt of the rest of the EU is only half of it, the UK has by far the highest consumer debt in the EU as well. Still not to worry, being less like Europe and more like the UK will sort it out.

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Love this bit:

"Osborne’s last hope is that the figures end up being substantially revised. This has been the pattern in recent years, with data being changed in a pretty substantial way over time, substantially improving the original picture of the public finances."

In other words, if the figures don't say what you want them to, just change them!

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I don't think you've followed!!!!

If we'd have borrowed more we'd have had stronger growth meaning more tax receipts, however because we haven't borrowed enough to fund growth we've had borrow more to make up for the lack of growth and hence tax receipts.

Is this clear? :P

Perfectly.

Attempting to cut govt spending during a depression was stupid and the outcome of expansionary austerity was predictable.

It didn't increase growth but it has led to his deficit predictions being way off.

The argument is entirely consistent (unless you believe in the nonsense about govt. credit cards)

There's also an inconsistency of argument at play here:- If you want a house price crash due to higher rates then if you believe a higher debt/GDP will cause rates to rise then you must want higher borrowing and higher public spending.

If you believe that a balanced budget and lower debt/GDP ratio will cause rates to fall then you're presumably less likely to get a house price crash from if the Tories cut public spending.

Edited by R K

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Alistair Heath is a bit confused:

In the main, the rebalancing between private and public sector has gone well, with swathes of GDP transferred away from the dead hand of the state. The business community, terrified of the prospect of a far-Left Labour government, has swung behind the Chancellor.

Erm.. Which rebalancing is this? The re-privitisation of our bailed-out banks? Oh wait, that hasn't happened yet, maybe it's the sell off of Royal Mail at a knockdown price to those "long-term" investors?

Anyway, glad that we haven't ended up with a far-left government that would open the flood gates on social benefits...

Most to blame were net social benefits, which also jumped by 5.4pc to £17bn, led by higher state pension payments, social assistance payments and public sector pension payments. Departmental current spending jumped by 3.1pc. This is madness. The Government ought to be tightening its belt, not opening the floodgates.

...Oh.

Anyway, it's not all bad news stamp duty tax receipts are up... hooray.

As to stamp duty receipts, they are up by 25.2pc. This is very bad news as it means that homeowners are being clobbered, the housing market is being badly damaged and the Treasury is becoming increasingly hooked to this terrible tax.

...I mean boo - we can't be damaging the housing market, how the heck are the Tories going to win the next election and sort it all out if house prices start falling.

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Twice the national debt of the rest of the EU is only half of it, the UK has by far the highest consumer debt in the EU as well. Still not to worry, being less like Europe and more like the UK will sort it out.

To be honest, it may be better if the UK does leave the EU - it will no longer have a scapegoat when the real problem has been inflating the housing (and financial) sector at the cost of the real economy.

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To be honest, it may be better if the UK does leave the EU - it will no longer have a scapegoat when the real problem has been inflating the housing (and financial) sector at the cost of the real economy.

Fine for us old fogeys[1]. But denying younger folks the opportunities we enjoyed to live and work abroad without being second-class alien citizens or suffering endless red tape over immigration.

[1] At least so long as our safe-haven status for the global super-rich keeps the pound up so we can afford our imports - including the basics just to feed ourselves - in an increasingly-competitive global market.

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He wants to entirely separate the issues of low pay and welfare spending- as if the low paid and those receiving state support were different species- in reality of course things are different, and a substantial amount of state support is being directed at people whose pay is so low they cannot afford to pay their rents or bills.

The joke is that guys like Heath have been arguing for decades that a 'flexible' labor force is the key to prosperity- but now they have exactly that- a poorly paid and insecure working population- they find that as well as benefits (cheap labor) there are costs in terms of having to support these people financially.

Maybe if people were paid a living wage instead of having their wages topped up by tax credits or housing benefit the welfare bill might be reduced- and maybe if the corporations paid their taxes instead evading them the tax take might go up.

But of course both these solutions would hit the 'wrong' people- so instead we will have more the same- more and more people forced into low paid jobs or 'self employment' and more and more calls for cuts to the welfare bill.

Edited by wonderpup

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Calling them stupid is a waste of breathe.

Of course they are...they dont understand anything about Economics (although they should since they all seem to have a PPE degree from Oxbridge).

Since Blair we have had these useless career "pygmy" politicos who look good on TV and that is that.

Any how it has gone past the point where they could do anything even if the knew what to do and had the intention to do it.

The SYSTEMIC problems we now face will take longer than the election cycle to fix.

The action of eroding out national DEBT will require not only the end of the yearly deficit but also actually spending less than we take in tax receipts for a prolonged period (decades).

The entitlement class will not like that and will remove any leader who even looks likely to embark on such a course of action.

Bread and Circuses it is then.

.

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To be honest, it may be better if the UK does leave the EU - it will no longer have a scapegoat when the real problem has been inflating the housing (and financial) sector at the cost of the real economy.

The truth is in the short term world of politics, the EU immigration has flattered our deficit. basically we have promised ourselves the moon and the only way to maintain the welfare Ponzi was to import labour.

These immigrants are (meanwhile) accruing trillion of pounds worth of health and retirement rights, all off balance sheet; so trying to maintain the Ponzi and keeping the deficit at manageable proportions (7% doesn't look very manageable to me) means even more grief in forty years time when we have to import more immigrants to support the immigrants.

But once you set out on a Ponzi scheme there is no obvious way out. You can't taper out of a Ponzi scheme.

Population expansion doesn't work because we all leave a £250,000 public debt( to be paid by future generations) on our deathbed...well the current generation do anyway.

Edited by crashmonitor

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@Davidg

Should have been deficit = twice the level of the rest of the EU. As for National debt, looks now as though the UK could overtake France this year together with twice the deficit going into 2015. If France is fkd what does that say about the UK?

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Guest UK Debt Slave

Ed Balls may appear to have lost the argument but actually we have followed his plan B to the letter, run the largest deficit in Europe and won the race for growth.

It isn't sustainable though is it?

It hasn't made a blind bit of difference having the sham tories in power. Ed Balls and Osborne both belong to the Bilderberg Party. All roads lead to the same place irrespective of which useful idiots are running the UK economy.........a slow grinding descent into economic armageddon.

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