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Author Topic: Borrowing and Austerity  (Read 271 times)

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BillyStubbsTears

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Borrowing and Austerity
« on May 23, 2020, 04:18:39 PM by BillyStubbsTears »
Anyone remember back in 2010, when Cameron told us that we had to cut borrowing savagely or the money markets would take fright and interest rates on our debt would go through the roof. So that meant we had to stop building new schools. It meant we had to cut working age benefits. It meant we had to stop giving nurses reasonable pay rises.

Rememeber that?

Remember at the same time, pretty much the entire economics profession shouted back, "No, you do not understand how these things work. Interest rates will NOT go up, and in any case, if you cut sharply, you will NOT get debt down because you've hammer the economy and therefore your ability to get income up."

Remember that?

So, let's see.

1) Debt didn't come down. Economists 1-0 Tories



2) Interest rates came down. Economists 2-0 Tories


But still we were told, before the last election that Labour's reckless borrowing plans would send debt interest through the roof.

Well, in April, we borrowed more than in any single month in history. The forecasts are that by the end of the year, our total debt will be higher than it has been since 1963.

Surely now THIS means that the money markets are going to take fright and demand much higher interest rates before they will lend to the Govt?

Well, no. The Govt has just issued a shed load of new debt. The money markets have taken it on. At NEGATIVE interest rates.

Read that again. The Money Markets are PAYING the Govt to borrow money from them.
https://www.ft.com/content/2c27518e-2870-47e7-b084-6a1c4ff30c32

If anyone EVER claims that Austerity is or was ever necessary, you have a moral responsibility to t**t them. THE most reckless and stupid policy that any Govt in the last 100 years has ever imposed on the country. It must never happen again.

Filo

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Re: Borrowing and Austerity
« Reply #1 on May 23, 2020, 06:24:31 PM by Filo »
And FTSE has been climbing steadily for a few weeks, to the point where itís recovered half of its losses from the CV19 meltdown

BigH

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Re: Borrowing and Austerity
« Reply #2 on May 23, 2020, 10:44:59 PM by BigH »
Austerity was a nonsense from start to finish.

In 2010 the 'deficit' was held up as the bogeyman, but all that happened was that it kept getting refinanced onto longer term debt. A bit like paying down your overdraft by constantly remortgaging your house.

Hopefully, sense and good economics will now prevail although this time it will take ages to sort. Our economy needs to grow again. That'll require government investment in the short term and inducements to the private sector to invest meaningfully over the longer term.


Wellington Vaults

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Re: Borrowing and Austerity
« Reply #3 on May 24, 2020, 09:18:19 AM by Wellington Vaults »
Now Now, BST, you cant go quoting facts and figures when good, old fashioned, political dogma is at play.  It just wonít do.

idler

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Re: Borrowing and Austerity
« Reply #4 on May 24, 2020, 09:58:48 AM by idler »
Now Now, BST, you cant go quoting facts and figures when good, old fashioned, political dogma is at play.  It just wonít do.
Jesus, Wellington have you been monitoring this forum from afar? When was the last time that you posted on here?
Good luck for the rest of the season when it restarts by the way.

Sprotyrover

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Re: Borrowing and Austerity
« Reply #5 on May 24, 2020, 05:27:00 PM by Sprotyrover »
Wellington Vaults a blast from the past,nice to se you're still around.

phil old leake

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Re: Borrowing and Austerity
« Reply #6 on Today at 11:36:49 AM by phil old leake »
Whatís the point of the thread. Is it to suggest that the government should have done nothing to support the working man and just locked down made everyone unemployed and let businesses go to the wall
Youíll have to forgive me for not understanding but what else were any government from any party going to do

SydneyRover

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Re: Borrowing and Austerity
« Reply #7 on Today at 11:44:41 AM by SydneyRover »
I don't speak for bst of course Phil but I think he's pointing out the rank hypocrisy of the tory response in two different ways to essentially the same type of problem.

BillyStubbsTears

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Re: Borrowing and Austerity
« Reply #8 on Today at 11:46:17 AM by BillyStubbsTears »
Phil.

Read the OP.

The point is that the Tory Government should never EVER have put the Austerity policies in place that they have run for the past 10 years. They were massively damaging and were based on voodoo economics that have been PROVEN to be bullshit.

If anyone even hints at Austerity as the way to get out of this crisis...