Winners and losers

luke

The nation's newspapers give Cameron and Clegg an almight kicking this morning - truly awful headlines - and you're writing about Ed Balls?

normanc

Labour are quickly distancing themselves from reality. Whether or not they believe this nonsense about 'too much too fast' and simply saying it to try and capture disaffected voters is another matter.

If they do win the next election and embark on another debt fuelled spending binge, far from being the death of conservatism in the UK (as James Forsyth predicted two weeks ago in the mag), I'd suggest we will see a resurrection of conservatism.

I really can't see more spending, borrowing and taxes as being the way out of our predicament, despite what Balls and Osborne tell us.

Lonesome Dave

Given the involvement of Balls and Miliband as prime architects of the chaos we are now trying to clear up - at great pain and cost - then his comments are not worth a jot. He is given undue airtime and credence by his ideological chums at the BBC.

Too deep and too fast? Rather like Labour's decent into financial disaster.

Same old Tories - fixing Labour's mess!!

TomTom

Articles like this are pointless drivel: intellectual masturbation for journos. the real issue is a major Devaluation which makes Sterling prices for petrol painfully high; costs for food and energy painfully high; and increased VAT a real drag on consumption.

There are no real "winners" unless they work in The Square Mile. Most people are PAYE slaves and see no significant increase in the means to pay the bills.

The rest of this stuff is a theoretical world of journalistic fantasy

Sally Chatterjee

I can't help feel Balls would deny his first name was Edward if he felt it would help him bash a rival.

Victor Southern

"Too far too fast" is now Labour's sole mantra. Reminiscent of the "End to Boom and Bust".

Simon Stephenson.

"That said, it's striking just how much more effective Ed Balls is when he talks living standards rather than Labour's general fiscal prospectus."

That's because he can take the entire voyage to cloud-cuckoo-land, to stir up wants and emotions, without having to address the issue of how to reconcile the independent desires of people and their families with the desire of him and his fellow statists to spend ever-increasing wodges of the national product on the public-sector.

It's difficult to see how much more brass-necked, or deceitful, the leadership of the Labour party can become.

tb

Ed Balls fighting for the rich again... Maybe he'd prefer if the 20% who're loosing out were the poor?

Maybe he'll have to claim a bit more, along with his wife, to make up for any personal pain affecting his millions.

But definitely a donut thing to do, tell everybody they'll be worse off so when the majority find they're not they'll think the Tories solution is working.

Chris lancashire

Balls on the radio this morning claims the Coalition (sorry, Tory-led government) are giving with one hand and taking with the other.
Well, he should know; did it for 13 years.

old fogey

Luke- considering Cameron's playing Lady Bountiful in Pakistan, he deserves awful headlines. Not least for the absurd comments that accompanied his giving away £650 million of taxpayers money. This is terrible, and frankly I shall not vote for Cameron or his party at any election (he's my constituency MP). This is Danegeld pure and simple. And his comments on the world's problems being mostly because of Britain's 19 and 20th century foreign policies..I thought this 'heir to Blair' business was an election winning stunt, but it's true !

James W

The telling part of the Today interview was at the end. The OBR estimates that for every additional £1 not used to reduce the deficit, the country with generate 30p in growth. In other words - those who argue that the deficit reduction is too far, too fast are actually arguing to defer more pain to the next generation.

Balls had no answer to this - because there is no answer to this.

Andy H

As much as it pains me to say it, the last election came at completely the wrong part of the economic cycle for the vast majority. If there was another year to go, then Labour would have reaped their just rewards for their economic malfeasance and reckless behavior (but this country, sadly would be in the same position as Portugal)

As it turns out, the change happened too early for the mass population to see the full cause and effect of the historical financial legacy that occurs when socialists are left in charge of the economic levers, with their idiotic ideology that the state can create wealth (instead of actually just taxing and spending it).

I fear the only way that this will ultimately be fixed is by a final term of Labour in power.

This will surely result in a sober and considered view of the vast majority of this country to never let the tribal socialists a foothold in Government ever again.

Occasional Ostrich

If Balls were to tell me black is black I'd have to make my own independent check.

Percy

I agree with Luke the coalition's top trustafarians are taking a real spanking today and all you can do is write about this dickhead?

Simon Stephenson.

TomTom : 9.44am

Did you read Jeremy Warner's article in yesterday's Telegraph(*)? In it, he suggests that the masterplan is to re-boost household debt back to pre-crunch levels in order to produce the demand needed to get British industry working again.

The question I ask myself is why those at the lower end of the prosperity ladder should have their incomes and expenditures pre-ordained from on high, yet business and the better-off are given a free rein to earn and to spend exactly how much they choose to.

It strikes me that we're seeking to regress to 19th century arrangements, where the activities of 90% of the population are determined with little thought for their best interests because everything that's done is designed to being accommodating to the remaining 10%.

Maybe the forcing of debt onto the poorly-off is the flipside to an over-accumulation of wealth by the better-off. Could it be time to say to the latter "Use some of it, or lose some of it"?

* http://www.telegraph.co.uk/finance/comment/jeremy-warner/8427688/Households-sink-under-a-sea-of-debt.html

RKing

Victor Southern @ 9:53am

Brown did put an end to Boom & Bust!!

True to his word we are now permanently Bust!!

Simon Stephenson.

Andy H : 10.18

"As it turns out, the change happened too early for the mass population to see the full cause and effect of the historical financial legacy that occurs when socialists are left in charge of the economic levers, with their idiotic ideology that the state can create wealth (instead of actually just taxing and spending it)."

The psychology doesn't work I'm afraid. What you're asking is for a mea culpa from vast numbers of people who voted Labour in 1997, 2001 and 2005. You won't get it, and you wouldn't have got it even if the entire economy had gone down the pan before they could have been booted out.

You see, to most people there's a selective valve in the link between their actions and the subsequent outcomes. When things go well, that's down to their wise decision-making, but when things go badly it's due to matters outside their control or the unforeseeable incompetence of others. So most Labour voters are only prepared to be associated with the praiseworthy things that come out of a Labour government, and not the catastrophes.

To be fair, this also applies to supporters of other parties, but, I'd suggest, not quite to the same extent.

Jose

It is amusing to read "not least because it actually bears some comparison to the truth" as if Balls would know the 'truth' after so many years of untruths by the whole of Labour.
They really are a disgrace and how the Tories can allow such a pathetic mob run circles around them on occasion is mind-boggling. Cameron needs to realize crushing Milliband every wednesday is not the be all and end all; it needs to be done by the whole of the front bench day in day out!

YorkshireLad

Woke up this morning full of the joys of spring. Got in the car, turned on the radio only to be confronted with Ed Balls spouting is usual drivel. Result? Where did I put my Prozac?

Andy H

@ Simon Stephenson

You make a good point. However, I do believe that the result of the 70's socialist debacle did result in 18 years where the general population's socialist tendencies were somewhat neutered.

This must have been due to the direct proximity of the Labour Government to the visible results of the 3 day week and bodies laying unburied.

The fact that the chickens did not come home to roost under Gordon Brown's watch means that he (and Ed Balls) have escaped the recognition that would otherwise have be (rightly) attributed.

I don't believe that this Government has been astute enough to cement the link between the cuts and the past and that will come back to haunt them (and ultimately us all).......

Liz Brown

has sowhatballsup paid his Landlord yet? I might (a very long shot, granted) start paying attention to him, once he pays his own way in the world, rather than expecting the hard pressed taxpayer to pay for him

dorothy wilson

Two key points:

1. Labour's Chief Secretary to the Treasury's note to his successor: "There is no money".

2. Labour's mantra "too far, too fast" ignores the fact that Darling's plan of reducing the deficit by half over 4 years would add to the debt and thus to interest payments. Those are already £120m a day.

TomTom

Simon Stephenson.
April 6th, 2011 10:32am I did see it, he was commenting on the OBR postulates. Where will people get this credit anyway with credit card limits arbitrarily cut and interest rates jacked up. The Government has now forced the card issuers to increase minimum repayments.

The squeeze is so restrictive that it seems a bit like the Corn Laws screwing down the working poor to create supernormal profit for the landed interests

HJ

It was noticeable just how restrained Danny Alexander was in the face of Balls. He was reasonable and polite.

But surely what is needed is a bit of Tebbit-like bluntness towards Balls. He was a major architect of the mess we are in and no government spokesman should sit there being criticised by him for trying to sort out the mess he left without pointing out his hypocrisy in no uncertain terms.

Paddy

If Labour had been returned after the election they wouldn't have made any cuts.

I honestly don't think they are capable of making cuts or living within their means.

They would carry on spending and be quite happy to let the IMF come in.....like Portugal and Greece.

It would then have been...."nothing to do with us gov".

Fatbloke on tour

PH

When are you going to get round to talking about the personal / household debt disaster flagged up by the OBR?

£565bill increase over 5 years - incredible.
Debt levels have been falling.
Now for a huge splurge.

Any thoughts that this piece of tripe is a fiddle factor to tie together their economic fairy story?

Either that or there is going to be an almighty asset bubble in housing sometime soon.

Non mortgage debt is only £210bill at the moment so if it isn't going to be going on housing surely we are not going to be seeing a trebling of personal debt?

So can we get a bit more on debt please?
Inflation has been done to death.

TrevorsDen

You are well named old fogey and twerps like you voting to allow a labour victory are what ruined this country.

We have a long history of aid to Pakistan.
http://news.bbc.co.uk/1/hi/7486948.stm
The recent visit was as much about trade as aid -- and helping prevent young Pakistanis (some born in the UK) being tuned into suicide bombers seems like a sensible idea to me.

Pakistan borders Afghanistan and we have 10000 soldiers there. I would like to see them home sooner rather than later.

But heaven forfend that the niceties of geopolitics should intrude into your (and the usual suspects') fantasy world.

In any event the aid is not open ended...
http://www.independent.co.uk/news/world/politics/david-cameron-warns-pakistan-over-uk-aid-2262828.html

'the first year's funding of £60 million will be followed by significantly larger tranches only if it shows results.'

So hysteria reigns over 60 million out of our budget of nearly 700 billion.

But why bother actually reading and heaven forbid 'thinking' - lets all just stick to thick prejudice shall we.

Andy H

@ Fatbloke

Yes - the personal debt bubble is a real issue - one that was directly caused by the last Government - so it a good thing that you are finally beginning to see the major short comings of the socialist policies.

Perhaps you have started some counselling to help with the low self esteem issues you exhibit?

alexsandr

If they think we are going to have a personal debt fuelled recovery then they should think again
People are looking to reduce debt, not get more.
and with the piss taking rates the banks are charging who can blame em?

Fatbloke on tour

Andy H @ 2.57

The bsay that the Tory Party is the Stupid Party so I can take it that you were born into it.

Please look at the OBR small print:

Personal / Household debt:

2010 = £1,560bill
2015 = £2,125bill approx.

Consequently your viewpoint is a little out of date. The figure had been falling due to the Credit Crunch but now Sniffy and the dog boilers are privatising debt.

They are cutting the public sector deficit faster than is reasonable or economically justified and passing on the debt to you and me.

£565bill over 5 years is the biggest increase in personal debt in history.

david hatfield

If DC judges it to be in the national interest to give the aid to Pakistan that's ok. It's the apology that sticks in my craw.

Simon Stephenson.

Fatbloke on tour : 2.24pm

Household Debt

Why don't you set the ball rolling by commenting on the increase of household debt from c.£500 billion (60% of GDP) in 1997 to c.£1,400 billion (100% of GDP) in 2007, and how this created a temporary bubble-growth of GDP which the Treasury leaders at the time chose to regard as permanent, when setting out their public spending plans for the following few years? And how this imprudent course of action is the fundamental reason for the the very difficult adjustments to public spending which the present government is having to undertake.

Simon Stephenson.

Fatbloke on tour : 5.03pm

"£565bill over 5 years is the biggest increase in personal debt in history."

Well I newver did! And you usually so meticulous about not bandying about monetary statistics unadjusted for inflation, size of starting point, or contemporary GDP levels.

The expansion from £1,560 billion to £2,125 billion over 5 years represents a compound growth rate of c. 6.3%. This compares to the compound growth rate between 1997 and 2007 of c.10.9%.

I appreciate that I haven't made any modifications for the fact that anything done by a Labour chancellor is "Good", and anything done by a Conservative is "Bad", but I expect you are more capable than I of identifying and highlighting these.

Andy H

@ fatbloke

Simon Stephenson is perfectly correct. I really hope that one day this may penetrate through the delusional fog that must envelope your mind.

The reality that you cannot begin to accept is that by definition the socialist economic dogma that is inherent in Gordon Brown and Ed Balls philosophy will always ultimately bankrupt a nation as they are new wealth creating. All they can do is spend other peoples money, mostly unwisely.

I think you need more counselling.....

Fatbloke on tour

SimpleS + Andy H

You just don't get it.

Household borrowing has been fairly static over the past 3 years.

The increase you talk about was in the main caused by a tripling of house prices in the years between 1997 - 2008.

1997 - Housing debt = £420bill
2008 - Housing debt - £1,200bill approx.

Non mortgage debt currently stands at £210bill, so what is the huge increase of £565bill going to be used for?

Another housing bubble or will it be used to bolster household spending?

The OBR has doubled its estimate of the increase in household debt in the 9 months Sniffy has been in charge, that is a huge increase brought about by his slash and burn economics.

Finally id debt was to high in the past whay is it right for Sniffy to pass on this huge increase in household debt from the public to the private sector.

It is going to mean that the savings rate is going to fall by 55%, hardly the best wasy for the country to get back on its feet after the Global Credit Crunch.

And finally just where is this money going to come from?

State = Still borrowing
Corporates = Hopefully borrowing to invest.
Households = £565bill over 5 years.

Just where is the money going to come from?
Surely not another round of fast money from overseas ready to blow town at the first sign of trouble?

Simon Stephenson.

Fatbloke on tour : 12.51am

I'm sorry, but you comment is as worthless as all those you have made before.

If you are going to make an astute assessment of what's needed for the economy, and how close or otherwise government policy is to this, you can't start from the presumption that because the previous government was Labour, there can be nothing in what was handed over that is in any way the cause of the present difficulties. You can't allocate responsibility for unsatisfactory situations without acknowledging the true extent to which these were predetermined by previous policy.

If this is your approach to investigation, and with you it does seem to be, in spades, then your conclusions are only ever going to coincide with best policy by chance, and never by design.

Here are the last three patagraphs of Stephen King's article(*) in Monday's Independent, of which you would do well to read the whole.

"The numbers are startling. In 2010, the level of economic activity was more than 10 per cent lower than had been projected in 2008. Whether economic growth over the next few years is at 2 per cent, 3 per cent or 4 per cent, the UK economy will be a long way from operating at a level of activity which would enable past promises to be met. Those promises were made on expectations which were hopelessly wrong. The nation now has to adjust.

To suggest that this is all the result of a temporary demand shortfall is hopelessly naive. No amount of fiscal stimulus will be enough to return the UK to the conditions that prevailed before the financial crisis, dependent as they were on excessive credit growth and a build up of systemic financial risks. It's up to our political leaders to work out where the axe will fall but there is no escaping the years of austerity which lie ahead.

And it would be good if those of an "extreme Keynesian" disposition admitted the need for hard choices, rather than pretending there is an easy way out of this mess."

* http://www.independent.co.uk/news/business/comment/stephen-king-more-keynesian-than-keynes-was-ndash-and-more-wrong-than-right-this-time-2261592.html

Fatbloke on tour

SimpleS @ 8.56

SK comes across as an economic sado masochist, a pesimist's pesimist if you like.

His whole argument is based on a flawed view of GB / AD's plans for the years after 2008. The plan was to gradually tighten the public finances in the medium term.

He also uses a lot of strawman aurguments to answer questions no one has asked. In the passage you have highlighted he puts forward the proposition that no amount of fiscal stimulus will generate a return to the days before the Global Credit Crunch.

But no-one wants to turn the clock back, PM spent 18 monts trying to develop a new future based on manufacturing, re-balancing the economy was the story being put forward by GB / AD.

The issue about more fiscal stimulus is that it will help bring about the changes needed, it is only a temporary measure to tide the economy over until private sector manufacturing growth can take up the slack.

Consequently he is just another middle class, establishment dog boiler wrapped up in a cruel to be kind blanket.

Simon Stephenson.

Fatbloke on tour : 8.01pm

"His whole argument is based on a flawed view of GB / AD's plans for the years after 2008. The plan was to gradually tighten the public finances in the medium term."

I appreciate thet this sort of guff goes down well at meetings of the dewy-eyed party faithful, but anyone with independent thought would laugh at the suggestion that Brown intended to tighten the public finances. Oh, sure, he arranged for the Treasury to produce some cloud-cuckoo-land forecasts that purported to demonstrate fiscal responsibility - but any nincompoop could do this, and anyone who believes that Brown didn't force the numbers to fit the policy must be a nincompoop himself.

Don't forget that I'm a chartered accountant - I've seen so many numerical and monetary fiddles and sleights of hand that I can tell in advance not only when one will be put into action, but also how it will be done.