This turned out to be my most popular tweet yesterday by some way.
It was inspired by comments from Labour spokespeople whose performance yesterday was dire in response to the autumn statement because not one of them would say anything of substance for fear of making a potential spending commitment, which is the last thing any of them will do:
Thanks for reading this post.
You can share this post on social media of your choice by clicking these icons:
You can subscribe to this blog's daily email here.
And if you would like to support this blog you can, here:
Tories don’t want to spend/invest; Labour doesn’t dare.
Sad, truly sad.
Indeed as you say truly sad an electorate that simply doesn’t want to make the effort to understand how the country should be working economically and monetarily. Got to admire Richard for the effort he puts in to try to change this!
Is there an entry in the glossary?
“Fiscal rules: bullshit self-imposed constraints made up by a politician to justify why they can’t (more rarely, can) do something that would be in the public interest. Used to excuse inaction, hoodwink voters, and calm skittish financial markets.”
Very good
But, maybe not….
Turns out you have something similar already.
https://www.taxresearch.org.uk/Blog/glossary/F/#fiscal-rules
Slightly more polite
But good marks for consistency
Thank you. You are the little boy pointing out that the Chancellor has no clothes.
Sometimes only Anglo-Saxon (and that word is as mild as one can use) will do to get the message across!
How can a labour government increase spending without spooking financial markets?
Stop QT
Problem solved
Labour created the operational independence of the BoE, so overruling them without legislative change would not be possible nor politic.
So pass a law
That’s what being in government is for
And they can over-rule anyway under existing law
If the financial markets are setting fiscal policy, then they need to be subject to democratic scrutiny and accountable to the electorate
Of course, those “fiscal rules” are Tory inspired. That’s the problem with Labour. In power they play by Tory rules and fiscal boundaries rather than trying to make their own. I doubt whether Labour have much of a future if their only strategy when it comes to “fiscal rules” is to be better at being Tory than the Tories.
“for fear of making a potential spending commitment”
There seems to be little attempt by any political parties to distinguish between “spending” and investment, the latter being lumped in with the former and implying that both are equally bad (and anyway – government only ever makes poor spending/investment decisions – always!).
Economic multipiers? Investments paying for themselves through increased economic activity?
To enter into such discussions is akin to pulling a thread on a poorly made carpet, and watching it unravel – fast – & we can’t have that can we?
Amazingly, John McDonnell talked about politicians ignoring multipliers on Sky last night
I found this analysis by Gareth Morgan very interesting, that with the increase in the minimum wage (national living wage), workers in receipt of means tested benefits (which is a large proportion of workers on the minimum wage) would get very little of it and the government would get a large proportion in reduced benefit payments and increased tax and national insurance receipts. Effectively by raising the minimum wage the government has transferred the benefits cost to the employer, while the worker gets very little benefit from it!
https://benefitsinthefuture.com/the-government-is-continuing-to-be-extremely-generousto-itself-nlw-2024/
The analysis is correct
How can small businesses meet this cost without it being infaltionary? Good question, I hear you ask….
BBC radio is happy to offer explicit discussions of porn sites involving fetishes, and disabled people with no holds barred, – maybe with a forewarning about the content or the language.
But it is not apparently ‘allowed’ to question – across a whole week of daily conversations, analysis and comment about the chancellor’s Autumn Statement, whether there really are fiscal rules, whether ‘we really do ‘owe’ £2trillion , whether the NHS is part of ‘the economy’ and of GDP and not just a ‘cost’, whether bossint soe public spending may indeed boost the eocnomy , tas paid, etc etc
What kind of democracy is it that where the governmetn each week lays down what can be debated on ‘independent’ and what can’t. There must be a suitable name/phrase for it – a ‘guided democracy’ a ‘proscribed democracy’ ??
One ‘model’ is the Overton Window – that some subjects or policies are too far from the mainstream to be considered plausible or even up for consideration. And with the decade(s) long capture of most of economics education by essentially neoliberal thought, or at best the weakly New Keynesian ideas of such as Paul Krugman, even if the media put up someone with a decent level of economics knowledge to question politicians and critique their statements and policies, those ‘critics’ are themselves working in the same mindset. There are exceptions, but a minority I think. (Richard can probably name a few?)
It is thought that 92% of economists are neoliberal
I wish I could recall where the stat came from
Is economist vs an art or a science? That’s a classic lecture economics undergraduates receive early on. But that question might be a skilful piece of misdirection to ensure the attention inquiring minds is not drawn to fact that economic is more akin magic. Economists uses magic thinking and magic word. words like ‘fiscal rules and “Gross Domestic Product” and……’money’. There are magical theories which they mostly all agree to agree. And present evidence to prove. Unlike scientists who’s approach to test to disprove theory.
The audience seems happy to accept the claims of economists (and central bankers and politicians who are even more confident) as fact because they don’t have the capacity to challenge them.
Economics is an art, at best
It seems to me as a retired NHS well EHS and SHS…there is NO NHS now since the Tories dismantled it in 2012! That the current Con party government have spent pots of taxpayers monies. We are now in a sad situation, [but a deliberate] fiscal situation. Where we approach 99% of our GDP or 98% of our country, s income from taxes. And who ever wins the next election May next year! Will have to raise taxes cut public spending and ask Chelsea FC and Spurs FC for a loan!