US & UK are poor societies with some very rich people.

Katie59

“But I'll point out, once again, that at least a third of the UK's 'borrowing' is money owed to itself. QE was achieved not only by the BoE buying bonds from the market, but also by the Treasury creating new bonds which were then 'bought' by the BoE. The BoE is owned by the state. So the 'debt' to GDP figure is misleading as the money the Government 'owes' to the BoE won't ever be repaid. You can't 'lend' to yourself...”

Because the bonds have a life and have to be repaid in typically 10 yrs theoretically they should be, what is more likely to happen is that another loan or bond is taken out.
In the meantime the GDP has hopefully grown and the % debt is similar.

Of course the economy might do well and we are able to reduce the national debt, although it’s only happened for 2 short periods in the last 50yrs

Why does the country need to reduce the national debt?

If you meant that I’m smug growstuff, let me assure you that I’m anything but. I know you worked bloody hard for little financial return, you’ve told me before. As I said in the post you quoted, which was in reply to an earlier post but you’ve taken entirely out of context, everyone’s story is different.

MargotLedbetter

Katie59

Germanshepherdsmum

Don’t know where you get 5% from Katie. Corporation tax is 19%.

No, the proportion of tax source, Income Tax is 25% Company tax is only 5%
There is a nice pie chart but it won’t upload
Google “Tax revenue source”

I think those figures are a little out of date. Income tax is around 25% but Corporation Tax is somewhere around 6.5%.

commonslibrary.parliament.uk/research-briefings/cbp-8513/

Thank you for the figures Margot

Why does the country need to reduce the national debt?

Good luck with getting an answer, growstuff

I think it's that word 'debt' and the legacy of Thatcher's household budget nonsense... It scares people..

Growstuff
The government does owe itself because the BoE is independant, as is the Federal Reserve in the US

The BoE is not the UK treasury it’s the treasury that issues Bonds when it needs more finance to run the country, some are bought by Foreigners, pension funds and others who want low risk investments. The independant BoE also buys bonds with new money - QE, the Bonds do exist they do have a life and the government do pay the proceeds on maturity back to the BoE.
This is of course a purely technical transaction, it’s exactly the same as the US where the US Treasury borrows off the Federal Reserve, and ensures that government borrowing is transparent and controlled.

In March the BoE stopped reinvesting bonds, currently it is selling bonds thereby reducing QE, we are hearing that the Truss government plans to increase borrowing, if they are not going to use QE they have to borrow off other investors and pay interest on those borrowings

The BoE is owned by the government.

Its 'independence' is limited to setting interest rates and deciding on money supply. Even the latter is overridden by the fact that the BoE is legally obliged to pay government bills.

The institution that issues the nation's money and is owned by the nation is not independent.

I need volver's brick wall.

The whole independant central bank system is there to give transparency so that financial markets can see how much governments are borrowing. Financial Markets are much bigger than any government, loss of confidence can ruin a country very quickly.

That’s the system we have it works well for the US but the US Dollar is the global reserve currency, wether it benefits Sterling and other lesser currencies in the same way I’m not so sure.

GrannyGravy13

DaisyAnne

GrannyGravy13

Sorry DaisyAnne to disagree, I know numerous people who are on UC both young and old. I am aware of their day to day struggles.

I have always advocated for a safety net for all who find themselves in the position to need one.

What I am not convinced about is the correlation between taxes and benefits as we are repeatedly told that taxation does not fund government spending.

I would be happy to pay 1 - 5% more in personal tax on the basis that it would go towards helping the poorest in our society, but for SME’s this is not the time to increase corporation tax.

I understand that GrannyGravy and we have much to learn from your knowledge of current business.

What I cannot understand are the put downs and the name calling. I doubt I ever will. Some people seem to use it as a crutch to build their own self esteem. It seems to me just the same as the client journalists who repeat the "state's" brainwashing.

I do not go down the name calling road, (I am too much of a people pleaser in RL)

I have said in another thread that I am becoming more aware of the gotcha journalism which appears to be growing daily. I assume it is to widen the divide and start othering , we only have to look at Leicester and Birmingham over the last few days, cultural as well as political unrest does not bode well for the future.

I have no idea what the solution is, I doubt if there is a quick fix.

I do know that I am politically homeless at the moment, not sure that is going to change any time soon.

I do apologies for misunderstanding where you were coming from. If we all become aware of use of "gotcha" journalism that should help but we are all open to it sadly. I know I can be.

We could start the politically homeless thread, but I bet it wouldn't just be the politically homeless on there . It could be a rest from being seen, sometimes not only as wrong but a "bad person" for just querying the ideologies of each of the extremes.

Katie59

The Bank of England Act 1998 makes it quite clear that the BoE is not independent of the government

Section 11
11Objectives.
In relation to monetary policy, the objectives of the Bank of England shall be—
(a)to maintain price stability, and
(b)subject to that, to support the economic policy of Her Majesty’s Government, including its objectives for growth and employment.

Section 19 Bank of England Act 1998

Reserve powers.
(1)The Treasury, after consultation with the Governor of the Bank, may by order give the Bank directions with respect to monetary policy if they are satisfied that the directions are required in the public interest and by extreme economic circumstances.

www.legislation.gov.uk/ukpga/1998/11/contents

The financial markets are mostly a wealthy person or institution's gambling scheme.
I'l remind you that it was the financial markets that caused the Global Financial Crash in 2007/8

The financial markets are a fact of life, regardless of wether you see them as gambling. It’s all about risk nobody is going to lend anything unless they know the risk, UK does need to borrow so it’s important to be open and honest about finances then a lenders can make their own judgement.

The energy market is also a fact of life, we don’t like it but have to live with it, the same can be said for any other commodity including food.