I'm just curious about this "black hole" that our new Chancellor is unveiling.
Obviously, I am not an economist, which will be obvious from some of my previous observations on GN. But I do have a questioning mind.
For instance, which accountancy rules are used to arrive at this government debt? Because from what I've been reading (no, not on Facebook or YouTube), if you change the accountancy rule, you can, ahem, adjust the 'black hole' accordingly - or even remove the debt.
And then, there's government 'forecasts', so a small increase in forecasted government borrowing can increase the debt.
Mr Calvert Jump (now there's a name for you!), senior lecturer in the School of Accounting, Finance and Economics, has said that
"There is now a consensus among economists that austerity does significant damage to an economy's potential, undermining growth, as the experience of the last decade in Britain has shown us"
Now pensioners just above the PC cut off may not be big spenders, but I'd wager their money more or less goes straight back into the economy. Any government plan that causes anyone to tighten their belts, is just plain old Austerity - again.
During the pandemic/lockdown(s) government pumped money into the economy - much of which I believe ended up in the pockets of the wealthiest. Where do they spend their wealth - conspicuously? Designer handbags? Jewellery? I think they spend it more quietly - on education, ensuring the continuation of the privileges of wealth, on health, property and investments. And their accountants, who accommodate their need to legitimately avoid tax as far as possible.
And, as the rich become richer and the rest of us remain static or poorer - where is the money coming from to grow the economy, as Starmer intends? If removal of the WFA from the above PC cut off is the beginning of more Austerity - or whatever his government decides to call it - if people are going to have less disposable income, where is this growth going to come from? Will we be an attractive option for investment?
I'm not quite sure where I'm going with this - except to say that I do not accept the 'black hole' claim by RR - because it's a £number/sum that can be +/- depending on which accountancy rules are used and economic 'forecasts',
MaizieD, where are you?