Responding to LabourList

rmh

Quite frankly that is a brilliant article and needs to be spread so wide that it hits every newsstand.

Do the voters actually get the BS that Labour is spreading?

Faceless Bureaucrat

So, over to you, Dolly...

Publius

Well said, Mr Nelson. The true level of UK debt needs to be hammered home.

Bear in mind too that, with the notable exception of oil, the US can get by without imports if it has to. Can Britain?

Derek Draper

Fraser, Thanks for your kind words about LabourList. We've made an ok start I think, with lots more to come. Alas your rebuttal is very shaky indeed. Here's why: On any independent economic measure for comparing debt nationally or internationally the UK is lower than the US.

Which are we supposed to trust: the IMF and CBO economists or a hotch-potch of partisan points from the Tories and their friendly thinktank?

This old chestnut about potential liabilities, pensions and PFI etc. is an old Tory line. No govt measures their debt in this way - on the same basis should we be adding govt land assets to our net worth? It's fantasy accounting. Just because the official measures don't stand up the Tory claims, you guys seem determined to make up figures that do.

And while you claim debt is spiralling because of the bank recap, they are neglecting the fact that our loans are against their assets - Northern Rock, for example, has reportedly repaid something like half its loans already. And what would you and your right wing friends have proposed we should have done to support the banks instead? Nothing, I suspect.

Debt was lower when Northern Rock hit us than when we came into office - that's why it can rise now as we take action on the banks and give real help now to help people through the downturn.

Fraser, stop being the voice of doom and stop dissembling, otherwise we'll have to start calling you Fibser Nelson and listing all your Fibsers...

Yours in comradeship,

Derek Draper

golfwidow

Fraser, it's a pity Andrew Neil did not give you the airtime to elaborate on the above when you tried to bring it up on yesterday's Daily Politics. It needs to be proclaimed loud and long from the rooftops.

Polly and Alice's mum

"..when WE came into office"!!!!
I didnt realise you were part of this government, Mr Draper.

m dowding

What a smug and arrogant reply from Draper. Note the new mantra;ignore the nightmare engulfing The UK. Talk up the wonderful and rosy glow of Labour's unparalleled success and fiddle the figures to fit.
Typical out of touch rubbish, Mr Draper. What ever you are taking I probably can't afford since your motley crew stole my pension, could I have some free?

TrevorsDen

And Mr Fraser - what about the GDP figure itself? Mass immigration creates its own GDP, but to what material effect. Migrationwatch claim GDP per head has barely moved.
I do not know what the situation is in America, but here in Britain this GDP figure is a chimera ( "a horrible or unreal creature of the imagination; a vain or idle fancy").

So, importantly, not only is the percentage wrong, the figure its based on is fallacious.

Brown and his govt quote GDP as some measure of success, but if our GDP has REALLY risen where is the evidence of the benefit? Any benefits we have acquired over the last 12 years come not from growth, not from productivity, they come from DEBT.

Mark

"Debt was lower when Northern Rock hit us than when we came into office - that's why it can rise now as we take action on the banks and give real help now to help people through the downturn."

This is a favourite piece of misleading nonsense from Brown and those who parrot his line.

Yes, government debt in 1997 was higher than when we went into this recession (or "global economic downturn" if, like Brown, you can't bring yourself to use the "r" work), but it was falling if (and it's a big if) you use Brown's dodgy figure of 38%.

The true comparison, though, it between government debt as a percentage of GDP when we last went into recession. It was 26% and the Tory government had been reducing it over the preceding years, as Brown should have been in 2004-7.

And we go into this recession with government spending far higher than tax receipts in the last of the good years, so that the effect of the extra borrowing needed because of the recession is that government borrowing rockets (see the over-optimistic figures in the PBR).

This means that the currency weakens, imports cost far more (hurting people and businesses who cannot afford them), etc. etc.

Obnoxio The Clown

They seem up for a genuine scrap, as opposed to the hysteria and name calling that the left often succumb to.

You must be reading a different site than I am. The whole place reeks of "Tories bad, LibDems bad, Labour good" and a whole lot of tightly-spun flannel.

(The fact that they don't even bother to publish my comments speaks volumes for me about how keen they are to defend their position.)

Faceless Bureaucrat

@ Derek Draper:

Oh Derek, how has it come to this? - you had a mind of your own once.

Do you really believe the comments you have just made, or did you just copy-and-paste it from a No.10 Briefing Note?

"This old chestnut about potential liabilities, pensions and PFI etc. is an old Tory line."

Er, no - just because these liabilities are (intentionally) off Balance Sheet doesn't mean they do not impact on the complete picture.

They are HUGE debts that will have to be paid and as such, it is essential that they are added into the equation ('out of sight, out of mind' will not work any more, I'm afraid).

As for the jibe about "... on the same basis should we be adding govt land assets to our net worth?" the prices for these assets are heading south along with everyone else's and the Government is currently attempting to sell many of them off as quickly as possible (once again at the bottom of the market, just like the UK’s Gold Reserves). So, no respite from that quarter I’m afraid.

I’m sorry if the facts do not fit with LabourList’s perceived view of the UK’s dire predicament, but facts they are…

James

"Which are we supposed to trust: the IMF and CBO economists or a hotch-potch of partisan points from the Tories and their friendly thinktank?"
Derek - since when has the ONS been a Tory friendly thinktank?
Even if Fraser's figures are wrong (I don't think they are by the way), the Govt's proclaimed figures are just plain lies. By every single measure imaginable the UK Debt (Govt, Corporate & Private) is at an all time high, and getting worse.
Why on earth labour supporters keep trotting out this bogus 37% figure is absolutely beyond me and many others.
Here's a thought - just tell the TRUTH, it might actually benefit you in the long run.

Jonathan

Dear Derek,

You write: "This old chestnut about potential liabilities, pensions and PFI etc...".

Please could explain what part of our pension and PFI liabilities are just POTENTIAL commitments.

Unless the GVN is planning to scrap the OAP or is going to allow public bodies like LEA's, & NHS Trusts to default/ignore their PFI commitments, then these monies will have to be paid. As such their are a debt that has to be honoured.

BTW I also have a couple of questions -

1) You claim that our National Debt is only 38.5% of GDP. Do you really believe that? If so do you also believe in Santa?

2) If our debt is so low then why is our bankruptcy risk ratio twice as high as that of McDonald's?

3) Finally if you believe Gordon's "we're the best placed economy is ride out the economic storm" mantra, the why is the £ sinking like a stone agianst a basket of currencies?

Short the UK

The Six Stages of Awareness:

1. Denial
2. Anger
3. Bargaining
4. Fear
5. Depression
6. Acceptance

The vast majority of our elite are in Denial. As the Pound collapses they move to Bargaining and back to Denial. The public are moving into Anger as they see the economy collapse. The uber brilliant have made it to Acceptance. I myself am in Depression.

Our country will be forced by the Market to go through these phases as our standard of living declines.

Our three primary wealth creating sectors are collapsing:

~The City.
~Property Speculation.
~Retailing.

The State requires a big tax take to keep the show on the road. Now that the tax take is collapsing we need people to buy our paper (gilts), the price of gilts is now falling and at some point there will be a gilt strike. As our creditors see our economy sink they will sell their British paper = Gilts & Sterling. As we import so much, unlike America, inflation is going to rise but at the same time the economy will be going into a depression. Thus you get the worst economic cocktail imaginable = Depflation.

It is very sad to see that our whole elite has brought our country to this position through the madness of rampant property speculation. Labour, Tories, Liberals, and the Media are all complicit in our downfall from the biggest bubble in British history. If you need an indicator that shouts this fact, it is the rate of interest. Once we start printing money, interest rates fall even further and GDP collapses, the Pound will crash. We truly are on the edge of becoming an Undeveloping Nation. The whole country is at fault, it is a cultural debacle. We are all to blame!!!

Lord Elvis of Paisley

All I can say is thank God Dolly doesn't have a brain otherwise he'd be dangerous.

RMH

A classic nulabour lie:

"Debt was lower when Northern Rock hit us than when we came into office "

In what sense, core debt? Maybe, but liabilities for which the country is liable?

No. If I have to guarantee the debt for someone I am liable, just like PFI, PPP etc etc.

These are liabilies.

I though the good times were supposed to see us save, not squander.

THX1138

Fraser "the hysteria and name calling that the left often succumb to", do you ever read the comments on this blog?

tenpin

Even if it is 38.5% GDP - that is still very worrying. Let's face it there are a lot more tax payers in the US that can contribute to paying off that debt. As for Derek's rebuttal very poor - he hardly dissected your comments and addressed each individual issue - I think he is well out of his depth in his blogging role (as are his party).

TrevorsDen

Dream on Draper. If you and Brown really believe your own pre match publicity then we really are all doomed.

National debt is up from £26 billion in 1960 and £90 billion in 1980. Debt has GONE UP - only by bringing in GDP as some Einstein like universal constant can it be made palatable.
In 1997 debt was 350 billion. Currently - Net debt was £511.3 billion at the end of October, compared with £480.0 billion a year earlier. The Pre-Budget forecast for net debt at the end of March 2008 is £541 billion.
Debt is GOING UP!

Debt fell early in the Labour years because it was already falling and set to fall and Brown was following Clarke's policies. He had to do that to convince the electorate to elect him. He was elected on Conservative economic policies. Thanks to Ken Clarke debt fell to below 30% of GDP.
From then on its been downhill all the way.

Maastrict says that the fiscal deficit should not be more than 3% of GDP. My understanding is that currently ours is 4.4%. Please correct me if I am wrong. Furthermore, Darlings PBR forcasts come from the pen of Lewis Carrol.

The debts we are running up will hamstring us in the same way that debts run up winning WW1 and WW2 did.
In the Bank of Englands own words "It is useful to consider public sector debt as a proportion of nominal GDP because nominal GDP is closely related to
the tax base of the economy, and so to the economy’s theoretical ability to service the debt"
Well with the finance sector hamstrung and profits and employment falling in the real world, the tax base is stuffed. So lets look at real figures not bogus GDP ones.

Ken Johns

So, Mr Draper, you fail to mention the figures from Office of National Statistics and choose to disregard PFI. Are these also produced by Conservative Central Office. If not so, please tell us why these figures should be discounted, or is this not convenient to your version of the truth, or that of the Saviour (Incapability Brown)?

Stonewall

Mr.Draper,
When did the ONS become a Conservative think tank? We should be told why public money is being "invested" thus.
And precisely by what amount has the USA utilised PFI or its equivalent to fudge their figures.
Keep spinning, as Mr Soros' ilk are laughing all the way to their non UK bank as you persist in this delusion and still Sterling falls.

Sean G

Derek,

Fantasy accounting? You do realise that what you have just described is the exact type of trick that Enron execs pull?

Great job derek, try explaining how we have the accounting practices of Enron.

Derek, don't talk about the economy because all you do is lower the average IQ of The Spectator readers.

Sam

One point the economic genius Draper failed to answer was about the pound. No doubt he would defer to our Dear Leader.

"A weak currency is the result of a weak economy...which result
from a weak Government"
Gordon Brown (1992)

Sterence

If Derek Draper's idea of countering an argument is to describe it as an 'old Tory line' then you haven't much to fear from the scrap you mention. Perhaps in 1997 it was enough to use 'Tory' as a term of abuse but now some proper reasoning is called for. And the sideswipe about 'doing nothing' is just made-up schoolyard abuse. One day someone should point out to Labour that activity and competence are not the same thing.

Regarding PFI, which other govts would have any reason to include or exclude £100bn of liabilities? Is there such a position elsewhere in the world (I ask this from a position of ignorance)?

Re Northern Rock, which half of the loan book does Draper suppose has been repaid, and how creditworthy are the customers that are left?

Lower debt - as a percentage of GDP only - after 10 years of global growth (or is the growth all Gordon's doing, whereas the crisis now is none of his business?) is hardly anything to boast about.

Mr Draper, you need to do better than this.

GLee

Pity someone can't spell REykjavik....

mac

Nice one, Fraser, an exclusive missive from the "Berkeley-educated" (ahem) Rebutter-in-Chief himself. Same old threadbare spin as the Boothdroid, of course, but very droll - 'Fibser', eh?

Alan

Doesn't really matter which report you cite, Mr Draper. Everyone knows the borrowing figure is twaddle. Labour supporters choose to proclaim otherwise, but deep down they all know it too. It is an inconvenient consequence of the Socialist ideology.

If Brown was flying the plane that crashed into the Hudson last wekk, rather than attempt to land it, he would have smashed the altimeter glass and bent the needle up. Job done!

mart

Fraser, it makes sense to me to do as you have done: ie. add together all the numbers that can be considered the liability of the taxpayer.

The suggestion that you offset this by asset values of publicly-owned land etc. seems sensible too. Presumably a credible scheme would have to be found for estimating market values to allow comparison between countries. Not easy.

But hold on: when you add up all assets (and assume these could be sold, which presumably most cannot) then would one even reach 10 bn pounds? I don't know, but my instinct is that it would be small in comparison to the debt numbers so would not offset them significantly.

Keep up the good work.

Fraser Nelson

Derek, whose stats do we trust? The Office of National Statistics is my first place to start which says 47.5% in December - against your 50% figure for the US. As for PFI, it is so well hidden that neither the ONS, INF, OECD or any agency counts it in their debt measurement. Thats why the UK figure is understated.

And as for other countries - no one else uses PFI to this extent to hide this amount of debt off balance sheet.I do love your suggestion that the idea of including PFI debt is fantasy accounting - and that the normal way is Brown's Enron-style accounting.

We don't need to argue about how much assets NR has repaid - the ONS keeps a tally and updates us monthly. The result is its net debt ratio: 47.5% of GDP.

Finally, Derek, you really must realise that Brown's claim that debt was lower when NR hit then when Labour came into office is a downright lie. Not an exaggeration. And let me give you the figures - on Brown's own measure, which excludes PFI. In May97, net debt was £351bn. The month before NR was nationalised in Sep07, debt was £514bn. By no stretch of the English language is this a reduction.

As golfwidow points out, television and newspapers seldom have the time or space to get into the details and expose Brown's routine lies. The internet does. This is why it has been a harsh forum for Gordon Brown, as so few of his claims stand up to the scrutiny which cyberspace offers. The blogosphere is a liar's nightmare.

There is a truthful, bold, reforming and radical Labour Party out there - and I rather hope that LabourList tries to tease it out. And I hope you keep coming at us, because we on the right get bored having to pick fights with each other just for the sport. Politics is a nothing if not a battle of ideas, and on the internet its been a one-sided battle for too long. So bring it on!

Jack Aubrey

Good to see some of the points I raised on Labourlist brought into the spotlight. An excellent article, Fraser.

cuffleyburgers

Fraser

An unexpectedly intelligent looking reply from Mr Draper. I think he has at least half a point about the debt figures - whilst I'm sure we can be as rude as we like about the numbers Brown bandies around we should avoid the trap of sinking to his level. Please could you and your colleagues from the CFS put together genuine like for like numbers for the G7 countries, I would suggest based on the definitions used by the CBO.

I am convinced that Brown and his useless, corrupt and stupid cronies have utterly shafted the British economy, so it is not acceptable that Mr Draper can be seen to be within half a mile of the moral high ground.

Recusant

Derek:

"Which are we supposed to trust: the IMF and CBO economists or a hotch-potch of partisan points from the Tories and their friendly thinktank?"

That includes the Office of National Statistics as well does it?

Nick

Derek you correct Frasers perspective and present your own - fine.

Really, the only view that counts is the market perception of the state of our economy with the KPIs being our ability to repay debt (CDS, £ v /$ etc), in which case Derek, they clearly side with Frasers view and not yours.

IdlingAway

Mr. Draper - I can just about accept your claim that bailing out the profligate and feckless using the money of prudent savers and taxpayers is necessary as I accept that we cannot allow the financial system to fail. However - it all has consequences. Over-leveraged banks, companies and consumers will have a long hard slog to repair their balance sheets and the politicians who allowed this to happen will receive no thanks from the electorate. So you can believe as much as you like that you are providing "real help" to people- the truth is that people don't see this as "help" - they view it as an almighty disaster for which you will pay the price at the next elections.

Laura

Polly and Alice's mum, Mr Draper was there at the start of this awful government and having helped sent the nation into a depression he now wants to work as a therapist cashing as the muggins voters get the blues!

The truth is, Del Boy, that Brown knows all that off-balance sheet stuff wouldn't be counted by outfits like the IMF and so that was why he got it off the balance sheet.

Where's it gone, pray tell? Into thin air?

Therapist for Mr Draper, please. He's having delusions about this government's levels of debt.

Andy

So Mr Draper, you feel more eminently qualified to make statements upon the economic situation. You have to excuse me if I look for a pinch of salt.
I’m with Jim Rodgers on this. He seems to me to be a little bit more qualified to comment then a politicised socialist desperate to prove that the failing ideals they have clung to are in fact maturing to the inevitable conclusion. Labour Governments ALWAYS run out of money. Try reading some history books laddie..

HJ

Derek Draper makes a reasonable point when it comes to public sector pension liabilities - they may be frightening, but no government accounts for them in its debt figures. However, we have a much bigger public sector as a % of GDP than the US, our liabilities are likely to be higher.

I thin that he is on shakier ground when it comes to PFI. PFI has blatantly been used to keep borrowing off the books - and I'm not aware that either the US nor European governments have an equivalent to PFI.

Derek Draper also forgets that public sector borrowing was already on a sharply downwards trajectory when Labour came to office and this led to debt reduction in the early years of New Labour. Let's be clear, however - this was legacy from the previous Tory government.

However, public sector borrowing and debt was on a sharply upwards trajectory even before Northern Rock. Gordon Brown had consistently borrowed many billions more than his forecasts in the previous five years - and the trend was worsening rapidly as look at the figures will confirm. The trade figures were also bad and deteriorating rapidly (we had a modest surplus when Labour came to power).

In conclusion, Derek Draper has a point, but he is being very selective with his facts.

Would he care to comment on my points?

So Derek Draper should consider the trend, not just the absolute level of public sector debt.

Simon

Derek,

Typical Brownesque reponse:-
1. Why does Derek not have any confidence in ‘his’ governments Office for National Statistics debt figures ? Which are we supposed to trust: the Office for National Statistics and government funded economists or a hotch-potch of partisan points from Labour and their friendly thinktank?

2. It’s scandalous that PFI are not being included in debt figures - of course most people wont really understand this point as unless they understand accountancy. So I guess you can drum role some labour spin about fantasy tory debt. Either you don’t understand this point or are being disingenuous in your argument.

I wish you had responded in more generous way to Frasers comments and had avoided name calling…but then perhaps we might have to call you Derek Duper?

RODEST

Anyone who thinks that this country does not have a debt problem must be brainwashed by Brown's propaganda.

Millions of people in this country have had their lives destroyed because they followed Brown's unregulated borrow and spend policies and were duped by the claim that boom and bust had been abolished.

What the Labourlist won't want to publish is the final cost to the taxpayer for their inept policies; nor will they admit that the solution to the problems, they have created, will be akin to Margret Thatchers policies of the early eighties.

Unfortunately whilst Brown is busy saving the World, this country is on the same slippery slope as Zimbabwe.

Hawkeye

Mr Draper - I would not believe you if you told me that black is different from white.

I have reached the point where it has become obvious to me that anything New Labour - or its mouthpieces - says is twisted and spun to delay the day of reckoning.

When the election comes I shall be getting in a crate of beer and inviting some pals round to watch a rare event - the complete electoral destruction of a political party.

It cannot come a day too soon.

Turbo

Great post Fraser,

I totally agree with the other comments that you didnt get enough air time on DP yesterday sadly.

With regards to Derek Draper..."Yours in comradeship"

Surely this is some kind of ironic nod to Gordon Brown's stalinist traits? That or Labour really are as out of touch as I thought!

Secondly...Labour list is a terrible site, its full of daft anti-tory videos that I really hope the public see. Whatsmore if you try to post anything slightly critical, the admins will not publish it...hardly sparking the debate is it! For me its just prolonging Labour's much needed internal troubles. If they cant even look at what went wrong "online" then the party will not recover for a generation.... THANKFULLY!!

Nicholas

Tribal response from Draper which reveals the usual Labour tribal arrogance. It is not YOUR debt Draper. It is OUR debt - the debt bequeathed to the taxpayer by the worst government in British history. £14m every minute, most of it spent on schemes that don't work by idiots whose agenda is ideological or self-serving rather than aimed at governing the country in a fiscally responsible way and in a way that serves everyone's interest, including the predominantly white, familied English working classes.

The champagne socialist hypocrites and hordes of Quango bandwagon jumpers that actually make up the government will retire with bogus honours and fat pensions whilst the rest of us mere mortals continue to live with the Labour imposed oppressive yoke of tax and regulation. Tax in ever more cunning stealth forms which inhibits growth whilst supporting a bloated, expanding public sector, which imposes ever more regulation which inhibits growth. A disastrous cycle worthy of 1960's East Germany or Cuba.

How long will it be before there are two communist public officials for every private sector taxpayer?

And how much taxpayers money are you and your Labourlist comrades being paid to spout your Labour propaganda? Disgusting. The regime is a disgrace and you are a disgrace. Call a General Election and let the people decide whether they want any more of Brown's "No More Boom and Bust", Away With The Fairies, ideological pseudo-fascist nonsense.

Wlliam Blake's Ghost

Fraser: Excellent article as ever but I do need to query you on one point. Where you say:

Although it hasn't been going long, LabourList is already brightening up the blogosphere

I take you to mean it along the lines of 'as William Joyce brightened up World War II'?

Polly & Alice's Mum:

Thats why Labourlost claims it is an independent blog.....

Big Don

I think Dolly really believes that if you keep on repeating some rubbish over and over again it becomes true.

Nell

Nice to hear from you Dolly
Before you start calling Fraser Fibser please could you answer the following questions.
'Which are we supposed to trust: the IMF and CBO economists or a hotch-potch of partisan points from the Tories and their friendly thinktank?'
Are you saying the ONS is partisan, and a Tory thinktank?
This old chestnut about potential liabilities, pensions and PFI etc. is an old Tory line. No govt measures their debt in this way - on the same basis should we be adding govt land assets to our net worth? It's fantasy accounting. Just because the official measures don't stand up the Tory claims, you guys seem determined to make up figures that do.
So we don't owe £100 billion on PFI because we don't measure it in the same way as the US. On that basis I have zero debt because I've decided not to include my mortgage in the calculation and my house is worth more than the mortgage.
And while you claim debt is spiralling because of the bank recap, they are neglecting the fact that our loans are against their assets
That is true, however, like my mortgage, the assets that the national debt is secured against are now descending in value - by just how many percentage points did the value of RBS decline on Tuesday – about 60% wasn’t it.
That's why it can rise now as we take action on the banks and give real help now to help people through the downturn.
As a real person (I think, but I'm never quite sure of ZaNuLab's definition of that) I was desperately grateful for the £200 reduction in the car I was not about to buy. Also as a real person worried about my job I am reducing expenditure. Guess what we don't pay VAT on essentials like food and VAT wasn't reduced on the essential diesel I need to run my car and get to work. Not to mention the vitally essential alcohol I need to cope seeing everything my and my parents generation worked for being wrecked by ZaNuLab.
This is my first attempt at Fisking. I do hope it is satisfactory.

Bocephus

If Britain is "uniquely placed to weather the downturn" how is it that the pound is at or near 52 week lows against the Israeli Shekel and Sri Lankan Rupee. Hardly the most stable countries on earth.

Brown is now expecting us to believe he is shocked to discover British banks having been lending to overseas companies and individuals. What did he think international banks did? He set the rules under which our banks operated, he wants the bank CEO's to accept responsibility but will accept none himself. Just as Fred ruined RBS, Gordon has ruined the British economy.

A Beal

Draper, your grasp of basic economics is almost as poor as our former Chancellor. The simple fact is that the UK as a whole already owes close to 100% of GDP in foreign currency loans (govt and private sector). We hold assets against this debt but the problem is that a large chunk of these assets is impaired or illiquid. Foreigners will not provide more cash if they think our financial position is unsustainable. The fall in sterling tells you they're already questioning this assumption. The problem is that as sterling falls our overseas obligations become harder to finance leading to further falls in sterling and more questions about our ability to service our debts. If you want to know how the story ends look at Thailand in 1997. Eventually, the currency collapses forcing interest rates higher and a massive retrenchment in government and private sector spending. It really does matter that the US has no such currency mismatch. They don't need to worry about their currency and can therefore inflate their way out of the problem. Attempting a US style rescue package is wreckless given the very different structure of UK debt. To argue otherwise, as Labour is doing, is plain stupid.

Faceless Bureaucrat

@ Derek Draper:

Do you really believe the comments you have made, or did you just copy-and-paste it from a No.10 Briefing Note?

"This old chestnut about potential liabilities, pensions and PFI etc. is an old Tory line."

Er, no - just because these liabilities are (intentionally) off Balance Sheet doesn't mean they do not impact on the complete picture.

They are HUGE debts that will have to be paid and as such, it is essential that they are added into the equation ('out of sight, out of mind' will not work any more, I'm afraid).

As for the jibe about "... on the same basis should we be adding govt land assets to our net worth?" the prices for these assets are heading south along with everyone else's and the Government is currently attempting to sell many of them off as quickly as possible (once again at the bottom of the market, just like the UK’s Gold Reserves). So, no respite from that quarter I’m afraid.

I’m sorry if the facts do not fit with LabourList’s perceived view of the UK’s dire predicament, but facts they are…

Wilhelm

Derek son

Let me get this straight. According to Gordon Broon's brilliant masterplan, the taxpayers give money to the banks , so that the banks can lend back the same money back to the taxpayers.

Sounds a bit Irish , Derek, kid.

Yeah, its a stroke of genius.

Yours not in comradeship

Wilhelm

Simon Stephenson

Perhaps Mr Draper would like to inform us why he's using just the figures for public debt as an indicator of the UK's relative financial well-being in comparison with other countries?

Does he not accept that this is equivalent to assessing an individual's financial health by looking at the size of his mortgage, and ignoring the balance of his bank account, his credit-card, whether or not he has a car loan, and anything else that contributes to his ability to service debt?

Does Mr Draper really want to be informative about this issue, or is he following standard Labour practice of misleading for party advantage?

Does he have the integrity to show us how the UK's overall nett debt, as a percentage of GDP, stacks up against other countries. After all, if an apparently healthy public-sector position is swamped by a catastrophic private-sector balance, it's hardly being honest with the UK public to continue spinning the line that we are "well-placed" ro counter the effects of the recession. Is it?

damon

A number of sane governments have either:
1. Put money aside for future pension liabilities (Australia)
2. Do actually state how much Pension debt there is (Ireland)

and every major company in the US and EU publishes theirs in their accounts.

As for PFI, most sane governments never entered into such bizarre lending agreements.

Labour ignores such measures because it persists in off-balance sheet accounting, and then has the temerity to have a pop at the banks.

Wily Trout

Labour with its head in the sand again.

Tiberius

I was going to ask, Fraser, whether you would like to hold my coat, but quite a few are ahead in the queue, it seems.

TGF UKIP

Fraser, nice to see such comprehensive Dolly shredding. As well as greatly amusing us lot, it will I'm certain, be giving a great deal of pleasure to many Labour circles as well.

What's even better, though, is being the silly pillock he is, he'll probably keep coming back for more.

Fernando

What I find most worrying is that they probably believe this nonsense and it informs their decision making. Still if you believed you had abolished boom and bust, that soaring house prices would have a safe landing and that you had saved the world banking system, you are likely to believe anything.

Wily Trout

Have you read Mandelson's contribution to Labourlist?
Here's an extract:
"But when it comes to new media we have to recognise that the days of command and control are over. Instead we need to learn to embrace and engage. That is why I am writing this blog and will be at LabourList's launch blogger’s breakfast on the 12th February. It is also why I will be returning here to respond to your comments in the days to come.
"So, in the spirit of openness and, dare I say it, comradeship, let the conversation continue!"
Notice anything?

TrevorsDen

Does anyone remember that scene in 'Airplane' where the entire crew and passengers are lining up to slap the hysterical female?
Where as the line progresses they all are carrying ever more horrible weapons of personal assault?

Just stop your hysterical whining Del-Boy, 'cos I am lining up to give you a good slap with the full panoply of Browns' patented 'light touch regulatory system' and administer the coup de grace with his tripartite agreement.

Plato

TGF UKIP - couldn't have put it better myself.

His delusions of authority seem to have also infected other contributors to Labourlist such as Tom Miller who now clearly sees himself as an expert on all things interwebby...

http://dizzythinks.net/2009/01/clouevoid-of-week-award.html

Is there a collective noun for such people?

Polly and Alice's mum

TGF UKIP: oh I do hope so - its such fun!!!

oldtimer

The charitable view of Mr Draper`s remarks is that they are either (a) the product of life in an ivory tower without the windows or parapet from which to view the real world outside or (b) the product of life in cloud cuckoo land. The more likely explanation is (c) spin.

Willem Buiter, the economist and former external member of the Bank of England`s MPC recently made this comment. It followed a visit to Iceland and compared that country`s sorry situation with the UK`s.

"Both countries pay the price for the hubris of policymakers who believed that they had engineered the end of boom and bust and replaced it with perpetual boom. The risks associated with asset market and credit booms and bubbles were dismissed (”how can you be sure it is a bubble? Do you know better than the market etc.”). In neither country have the responsible parties (the prime minister, the minister of finance, the governor of the central bank and the head of banking regulation and supervision) admitted any personal responsibility for the disaster. Instead we are told tales of a once-in-a-lifetime calamity, coming at us from abroad, that ruined a perfectly sensible and sustainable set of domestic policies, regulations, rules and arrangements. As if!"

Enough said.

toni

Perhaps you should temper your impatience Obnoxious. I'd just read your comment before I came here, and you are at number 9 of 22 comments.

I noticed that on the first days of the site opening, your abusive posts were displayed and then dumped.
Your manners appear to have improved somewhat since.

See? Just be polite then we may be interested in what you have to say. Easy peasy.

"That outdated thinking lead to a decade of people being thrown to one side and companies going under that could have been saved.

No, that led to a decade of people having their cheese moved and companies that should have gone under, going under.

Saving companies for the sake of saving them is stupid. Rover (for example) went down because they made rubbish cars that nobody wanted to buy. It is sad that people lost their jobs, but there is no point in me paying the government to subsidise Rover to make a piece of tat that nobody is going to buy. If the government is going to steal my money, I'd far rather they used it to clean hospitals or pay Gurkha pensions than keep a bunch of people making rubbish cars."
Obnoxio The Clown @ 3:07 pm, Thu 22nd Jan 2009

dizzythinks

Derek said: "On any independent economic measure for comparing debt nationally or internationally the UK is lower than the US."

The ONS was created to be independent. You're own leader said so more than once in Budget speeches.

George Laird

Dear Derek Draper

“Fraser, Thanks for your kind words about LabourList”.

Did you ever suspect that he was being kind for the sake of appearances?

“We've made an ok start I think, with lots more to come”.

I am not over familiar with your propaganda site for the discredited Labour Party, the party of sleaze but I will enjoy reading about Labour’s General Election loss when it happens.

“Alas your rebuttal is very shaky indeed. Here's why: On any independent economic measure for comparing debt nationally or internationally the UK is lower than the US”.

I think hits the nail on the head when he says that the internet is a liar’s nightmare, for example the Brown trick of continually accounting the same money over and over again as “new” money has been well and truly exposed.

“Which are we supposed to trust: the IMF and CBO economists or a hotch-potch of partisan points from the Tories and their friendly thinktank?”

Does Derek Draper living in the real world? Everyone is partisan were money is concerned!

“This old chestnut about potential liabilities, pensions and PFI etc. is an old Tory line”.

Interesting that Draper wants to dismiss the massive hole in the economy as just one of those things! Sterling has fallen through the floor, 3.4 million people are set to be unemployed and the property bubble has well and truly burst. Perhaps Draper doesn’t hear the screams of pain from the front being so chummy with those in Brown Bunker at Number 10.

“No govt measures their debt in this way - on the same basis should we be adding govt land assets to our net worth? It's fantasy accounting. Just because the official measures don't stand up the Tory claims, you guys seem determined to make up figures that do”.

We have now had a lecture on accounting ethics by Derek Draper, as Fraser points out, his first stop is the Labour Government.

“And while you claim debt is spiralling because of the bank recap, they are neglecting the fact that our loans are against their assets - Northern Rock, for example, has reportedly repaid something like half its loans already”.

An asset is only worth what the market will pay for it, not what you value it.

“And what would you and your right wing friends have proposed we should have done to support the banks instead? Nothing, I suspect”.

The New Labour phrase of the moment, “do nothing Tories”, what about Gordon Brown and his 10 years of failing to regulate banks properly, that was of course real do nothing in action.

“Debt was lower when Northern Rock hit us than when we came into office - that's why it can rise now as we take action on the banks and give real help now to help people through the downturn”.

Real help! Is that like the scheme to transfer people’s assets to housing associations which is estimated to help about 6,000, Jesus managed to help and feed 5,000 with some bread and fishes but Gordon Brown needs about £200 million.

Brown doesn’t seem like a saviour to me.

“Fraser, stop being the voice of doom and stop dissembling, otherwise we'll have to start calling you Fibser Nelson and listing all your Fibsers”.

Finally, the parting shot to remind us all that Derek is a “nice” guy is based on humour, the Fibser comment. This reminds me of John “daft workie come good” Prescott who would go and see the old dears at election time and laugh at nothing to do his regular man of the people spot.

New Labour has nothing to offer anyone and as the General Election draws near, the public will be throwing New Labour MP’s back where they belong, the scrapheap.

Yours sincerely

George Laird
The Campaign for Human Rights at Glasgow University

Ken

@Nicholas12:35pm -"Champagne socialist hypocrites and hordes of Quango bandwagon jumpers that actually make up the government will retire with .. fat pensions..."
Time for some astute lawyers to work out how to strip the above of pension "rights". These "rights" should be forfeit as partial punishment for criminal negligence in office - Nuremberg ll anyone?

Andreas Paterson

Fraser, you're comparing apples and pears in this article. If we assume that the IMF used a similar set of standards across countries, which is in my view a safe assumption it shows Britain relative to the US is in a better position.

The statistics you quote from other sources will no doubt vary as far as what and what not to include in their calculations and will naturally be different. CPS report is misleading, since the majority of the larger figure comes from public sector pension liabilities which which are generally not quoted on any balance

Derek's point that our national debt looks quite favourable would seem to stand.

HJ

Andreas Patterson,

You (and Derek Draper) have a point about public sector pension liabilities when it comes to comparing countries - nobody includes them. However, relatively our liability is larger than that of the US, because our public sector is a bigger proportion of the economy.

Other countries also don't have PFI funding on anything like the same scale - Brown used this specifically to get spending/borrowing "off balance sheet". The story is quite different if you include PFI liabilities (which the IMF didn't).

hadrian

Fraser,
We really needed you on Question Time last night, son!
Not that the ever articulate and shrewd Miss Janet Daley of the Telegraph didn't try her best but Dr Liam Fox was utterly abysmal, not only at articulating his points but in the seeming lack of hard hitting points to make. Time and again he let the truly awful and humourless Labour woman from Doncaster away with atrocious porkies. At one point she was whinging about how dreadful it was to be indulging in party political point scoring- only to be right in there at the very end. One consolation- her performance was even more awful than Dr Liam's. I'm sure Dr Fox is a canny figure but it didn't come across yesterday evening!