What a shower - they are not fit to govern the country

Services have been privatised and regulatory conditions removed because Conservative governments are largely financed by business and, as the saying goes, "he who pays the piper calls the tune".

To some extent, Labour also shifted its position (1) in order to get the mainstream media onside and prevent it from characterising the Labour Party as a bunch of communist infiltrators (2) in order to remedy the dilapidation of our schools, hospitals and other public assets, it decided to enter into PFI contracts and other privatisation vehicles - a way of avoiding short term spending but with horrendous long term financial consequences.

We now see that the argument "we don't have the cash to invest up front"was a spurious one. The massive debt run up by the NHS because of the introduction of a system of marketisation, competition and privatisation has, at a stroke, been written off by this government - and billions have been made available in respect of all manner of business and social concerns. Had our country's NHS, care system, justice system, education system, transport system, etc, etc, been in a properly maintained state before this virus struck, it could be argued that would be in a far better position to tackle it than we appear to be at present.

As for the implication that those who work in education, social services, health and social care, environmental protection, etc, etc, are somehow peripheral to a thriving economy, I would dispute that. If we have an ill-educated, unhealthy workforce and poor infrastructure, such as efficient and reasonably priced public transport, that will affect motivation, efficiency and overall productivity.

I find it interesting that nurses, carers,librarians, environmental protection officers, child care officers, probation officers, etc, etc - because they are paid by the state/taxpayer - are seen as an unfortunate drain on the economy. Meanwhile, the many people doing non-essential (but often highly paid) jobs, such as image consultants, PR consultants, personal trainers, event planners, lobbyists, marketing and advertising executives, marketing psychologists, etc, etc, etc, are seen as acceptable just because they can command high salaries, and even though their absence would not be greatly missed.

I agree 100% with DAVIDHS to use any form of creative accounting to get out the current situation would be folly. When I bought my first house in 1968 you could only borrow 3 times the salary of the main bread winner. We did not have credit cards and lived within our means. House prices went up slowly until around 1970. We were less well off and accepted that we paid tax at a fair rate, the highest rate of tax was over 90% on the highest incomes. Anyway the only way for the government to pay off the Covid-19 cost is through taxation over as long as it takes. To pretend otherwise is kidding us. Severe austerity hurts those less well off too much, we've seen that with the way the NHS and Social care have been short changed.

You can only build up debt for so long before it becomes beyond control. This is true for indiviuals, households, companies and even governments.

We were the healthy well educated population 50 yrs ago, we must have been because we now live into our 80s and beyond, we were able to afford the mortgage and rent. What went wrong ?, so much more has been provided but housing is unaffordable and we have food banks.

Services have been privatized for short term gain because we don’t have the cash to invest up front.

People in public services aren't just spending resources. They are providing the resources the country needs to create wealth, in the form of a healthy, well-educated population. Without them, the country is nothing.

I would have thought that the current situation has highlighted the importance of health/care workers, teachers, transport staff, posties, emergency utilities workers, etc etc. Some of those services have now been privatised, but essentially they are doing a public service role.

Maizie, we spend ever increasing amounts and employ more workers on education, social services, health and care, environmental improvements, none of these produce any income they are just spending resources.

Voters demand these services and governments have borrowed money consistently to fill the gap without realizing that wages have been eroded so much over the years. The national economy has not balanced the books for decades, in addition sterling has fallen steadily.

I'm not getting your reasoning at all. David.

Can you explain what you mean by this?

Resources have to be found to provide what we want at the expense of productive capacity,

Have we become 2.5 times less efficient?.

Thinking about my own question, as a nation we probably have, when you think of all the red tape, administration and services we take for granted. Resources have to be found to provide what we want at the expense of productive capacity, we are actually paying for that in lower wages.

Our age group does not feel the impact we got on the housing ladder 40+ years ago younger generations are finding it impossible.

Where has that increase in the money supply come from, David?

Yes, there has been inflation over the 60 years but there have been low rates of annual inflation ever since the peak in the early 80s. The UK isn't suffering from an increase in money supply, is it?

In fact, we're suffering from austerity, which cut the amount of money circulating in the economy.

House prices are an indication of the general rule that scarcity of a product that everyone wants will inflate its price...

Yes there has been an enormous increase in money supply but there has also been massive inflation, when the younger generation comment on the price of everything I remind them of that. When my bungalow was built in 1970 it cost £5k, its value now over £250k, an increase of 50 fold

I’ve just checked wages for 1970, average manual £26 doubling the 1960 rate, apply the house inflation rate we should be averaging £1300 each week, a stunning comparison. In 1970 housing costs were affordable, it seems that it’s not housing costs are too high, wages have fallen way below the level 50 yrs ago.

Please somebody tell me my comparison is wrong!. Surely wages cannot have depreciated in real terms by a factor of 2.5.
Or have we become so much less efficient?.

Let me ask you a question, Davidhs

In 1960 the population of the UK was 52.2 million and average weekly earnings were £12 - 14 pw. In 2020 the UK population is verging on 67 million and average weekly earnings are about £431.

To achieve that there has clearly been an enormous increase in the UK's supply of money over the intervening 60 years.

Can you explain how this has happened?

Maizie your assertion that a government cannot run out of money may well be technically correct - they can keep printing money. However the value of the currency can fall so low that the cost of imports and technology impoverishes the population.

There have been plenty of countries in this situation to a greater or lesser degree. Zimbabwe is a good example where for political reasons the whole productive ability of the entire country was shut down. Not just export ability, food production as well, adding to that widespread corruption and even after 30 yrs there has been little recovery. Currently we have Venezuela, Argentina and many other countries where the currency is worthless, where the largest banknote is worth 50p. To fill your car up you take a roll of notes that fills your pocket, all commercial transactions are done in hard currency usually US dollars.

This happens in the U.K, after WW2 Sterling was worth over 3 dollars since then our economy has gradually weakened and now worth $1.20, not a great performance. It’s not possible to predict what exchange rates are going to be after Covid 19, the US has its own problems, the Euro countries have their problems. Getting caught with no trade agreements is not a good position in a recession, so to balance the books, either austerity, higher taxation or sterling falls in value.

Sadly no, but where is the “banging on”?

Cindersdad

Please stop banging on about cancelling Brexit, it ain’t gonna happen!!!!

Don’t feel alone MaisieD and don’t think we haven’t noticed the poster whose only contributions are acid remarks often aimed at you.

All the excitement over Brexit seems a bit hollow now, “ Striking deals all over the world”? Buying food from the USA instead of 50 miles away? Controlling our borders - when we are the only EU country that hasn’t bothered?

jabberwok The USA health system isn't "free at the point of delivery" but it is still a shambles.

Given the way the NHS has been starved of resources over the last ten years, I think it has done a very good job.

I agree with you Cindersdad but yddasril is right - this is the government that people voted for, and Johnson is the man that many people still admire - unfathomably.

Dont feel alone maisieD some of us lurkers are listening to you understanding what you are saying and agreeing with you. Just because we dont comment doesnt mean we are not hearing or understanding what you are saying.

Cheers, MaisieD

Well Said GagaJo Ha Mon 11-May-20 20:55:24

Jabberwok ?? I think your comment cover it well.?

Thanks, Blinko. Nice to know some people agree with me. I feel so alone sometimes

Well, all I can say to your rather bizarre comments is ' In your dreams' and leave it at that!

"Jabberwok" the reason the GE was lost was down to Jeremy Corbyn being leader of the Labour Party. At the time neither the Labour Party nor the Liberal Democrats had credible leaders, Boris Johnson was seen as the best option by around a third of voters, a third voted Labour or Libdem, the remaining third chose not to vote. As to cancelling Brexit the EU would be delighted and let us cancel if we wished to. The majority in parliament does not reflect the will of the people.

I totally agree with the OP, and also with MaisieD (11th May 13.41) regarding how macro finance works at national level. It cannot be equated with a domestic budget. It's simply not the same. The national finances are completely within the Government's control.

Regarding the current situation, two things are relevant: a) every other nation will be in the same boat; and b) the solution need not be higher taxation (or higher taxation alone).

If the majority of the population recognise Brexit as a big mistake how come this wasn't reflected in the GE of 5months ago, or have we had a secret referendum since then that has passed me by?!! In other words how do you know this as a fact?!!