Do you want to discuss boring politics? (33 Viewers)

[Brighton Sky Blue]

My advice: don’t trust tax and spend political parties. It’s never enough.

The Scandinavian countries and their positions as the consistently happiest in the world beg to differ.

What we are moving to is a Scandinavian tax rate but an American level of public service…

 

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[Marty]

Don't trust the idea that spending is dependent on taxes, that's a good start

Money printer go brrr?

 

[Sky Blue Pete]

Just starting to get into politics , I’ve just read we are paying over £100 billion a year on debt interest. Madness. Surely instead of increasing spending on welfare and pensions and foreign aid etc , we need to bring this number down??

That money could then go to ( I imagine this along way off ) NHS, education , increasing the tax thresholds for people , more money for people to spend, creating jobs etc

The country is £2.8 trillion in debt??? Who in the hell let that happen?? Fooking madness

It was just this government and starmer

 

[Sky Blue Pete]

In fairness it was a case of "I'm alright Jack" from Pete. Sums up the modern labour party.

Thankfully my friends and family look at my actions not my poorly chosen (on occasion) words

 

[fernandopartridge]

Money printer go brrr?

All money is created from nothing mate, how could taxes be paid without it?

 

[Marty]

All money is created from nothing mate, how could taxes be paid without it?

I don't know. Creating more money leads to inflation, no?

 

[CCFCSteve]

Interesting thread. What he says is technically true on the point that we can’t go bankrupt…

If we get to a point where we’re printing money (because that’s how government “creates money out of nothing”) though and inflation gets out of hand, it’s a catastrophe waiting to happen.

Hence the point about household debt because a fundamental weakness of the UK economy is the asset price boom. Approx 50% of household spending is on household bills. Back in the 70s when interest rates were 17%, households obviously struggled but could mostly cope. Anything above 8-10% in today’s economy would be cataclysmic and people would lose their houses. No government wants to willingly devalue the property market or causes thousands to lose their houses.

In any case, Andy Verity kinda contradicts himself because his end point is that to restore ‘fiscal credibility’, levy windfall taxes on corporations rather than households… Windfall taxes on energy companies have had negative impacts and NI increases had similarly bad impacts on unemployment already.

MMT is just a convoluted way of getting to the same answer these days…..the amount you are able to spend is ultimately controlled by printing, inflation and taxation

You could argue that partial MMT is kinda already utilised when it comes to the QE used worldworld since 2008 and then governments inflating away some long term debt . This has gone badly in terms of overall debasement and inequality in most countries including ours

The only difference I can see with conventional theory is the belief that you can control inflation purely by taxation rather than interest rates. I personally think the tax system if far too cumbersome to change quickly, coming up with and implementing tax changes takes ages, let alone collection of those taxes.

Too many using MMT as ‘the answer’ are still intentionally/disingenuously not addressing the risks/costs/consequences of it though and Polanski is the new poster boy for this. Whether it would work long term, who knows, I’m not a prophet but there is no way this could ever be implemented into the current world without major economic shocks, probably devaluing of pound and rampant inflation, that would make truss mini budget look like a minor tremor

 

[CCFCSteve]

FWIW the answer is ensuring we improve productivity, implement a fair and deliverable (and simpler would be good) taxation system/levels and spend public money wisely. I frankly don’t give a toss what theory people use to get there

 

[fernandopartridge]

MMT is just a convoluted way of getting to the same answer these days…..the amount you are able to spend is ultimately controlled by printing, inflation and taxation

You could argue that partial MMT is kinda already utilised when it comes to the QE used worldworld since 2008 and then governments inflating away some long term debt . This has gone badly in terms of overall debasement and inequality in most countries including ours

The only difference I can see with conventional theory is the belief that you can control inflation purely by taxation rather than interest rates. I personally think the tax system if far too cumbersome to change quickly, coming up with and implementing tax changes takes ages, let alone collection of those taxes.

Too many using MMT as ‘the answer’ are still intentionally/disingenuously not addressing the risks/costs/consequences of it though and Polanski is the new poster boy for this. Whether it would work long term, who knows, I’m not a prophet but there is no way this could ever be implemented into the current world without major economic shocks, probably devaluing of pound and rampant inflation, that would make truss mini budget look like a minor tremor

Monetary policy alone has been brilliant at controlling inflation hasn't it

 

[wingy]

FWIW the answer is ensuring we improve productivity, implement a fair and deliverable (and simpler would be good) taxation system/levels and spend public money wisely. I frankly don’t give a toss what theory people use to get there

Is having mega Billionaires good for society,my measure is a no.

 

[Mucca Mad Boys]

Is having mega Billionaires good for society,my measure is a no.

Show me a society without billionaires and businesses...

 

[wingy]

Show me a society without billionaires and businesses...

Sucking up all the oxygen not a good plan for everyone one else, taking all the space,can only see a more isolationist existence for everyone?

 

[CCFCSteve]

Monetary policy alone has been brilliant at controlling inflation hasn't it

It hasn’t been too bad considering. A major situation that was caused by Covid supply shocks, Ukraine war and way too much QE. Most developed countries have got it down. The fact that countries had to use QT shows how much extra/unnecessary liquidity was in the system.

Also people need to be aware that, again from my understanding, to implement MMT you would need remove the central banks independence. Some might be happy with this and I think they’ve made a bit of a mess in recent years but then again without them the truss situation could’ve been worse. It feels like a theory where checks and balances are removed

 

[Sky Blue Pete]

It hasn’t been too bad considering. A major situation that was caused by Covid supply shocks, Ukraine war and way too much QE. Most developed countries have got it down. The fact that countries had to use QT shows how much extra/unnecessary liquidity was in the system.

Also people need to be aware that, again from my understanding, to implement MMT you would need remove the central banks independence. Some might be happy with this and I think they’ve made a bit of a mess in recent years but then again without them the truss situation could’ve been worse. It feels like a theory where all checks and balances are removed

You talk a lot of balanced sense

 

[Mucca Mad Boys]

The Scandinavian countries and their positions as the consistently happiest in the world beg to differ.

What we are moving to is a Scandinavian tax rate but an American level of public service…

You draw a lot of references to Scandi countries, and is a source of inspiration from people like Torsten Bell.

Our taxation system is more 'progressive' than the Scandanavian countries because our tax burden is placed heavily on high earners. The PAYE thresholds means that your average worker on 25k will pay 1/6th of their counterpart in Denmark and 1/4 of their Swedish counterpart in taxation.

Even more significantly, both countries are homogenous and have high level of societal trust and because they haven't had millions of migrants. You '' reacted to a post where I said that lifting the 2 child benefit cap despite it being absolutely true (1 in 3 families on the benefit are foreign born) and 1 in 6 UC claimants are foreign-born, these kind societal changes that build resentment. Reform and Conservative will be able to castigate the budget for funding large migrant families and unfortunately, it's true.

If you truly want to replicate Scandi society, you'd need to start with migration otherwise resentment builds v quickly.

 

[CCFCSteve]

You draw a lot of references to Scandi countries, and is a source of inspiration from people like Torsten Bell.

Our taxation system is more 'progressive' than the Scandanavian countries because our tax burden is placed heavily on high earners. The PAYE thresholds means that your average worker on 25k will pay 1/6th of their counterpart in Denmark and 1/4 of their Swedish counterpart in taxation.

Even more significantly, both countries are homogenous and have high level of societal trust and because they haven't had millions of migrants. You '' reacted to a post where I said that lifting the 2 child benefit cap despite it being absolutely true (1 in 3 families on the benefit are foreign born) and 1 in 6 UC claimants are foreign-born, these kind societal changes that build resentment. Reform and Conservative will be able to castigate the budget for funding large migrant families and unfortunately, it's true.

If you truly want to replicate Scandi society, you'd need to start with migration otherwise resentment builds v quickly.

Its not just the foreign recipients (I’m aware of the data and Reform will definitely play in this) that will cause resentment

The mirror printed an article yesterday that was highlighting the help some desperately need but I can imagine how others who have tried to be sensible by only having one or two kids and trying to give them the best life possible that their finances allow, may not be best pleased with all the examples

 

[SBAndy]

If you truly want to replicate Scandi society, you'd need to start with migration otherwise resentment builds v quickly.

People wanted big action on immigration, it goes down by 600,000 and nobody from the right of this forum has anything to say about it.

Mad init.

 

[Mucca Mad Boys]

Its not just the foreign recipients (I’m aware of the data and Reform will definitely play in this) that will cause resentment

The mirror printed an article yesterday that was highlighting the help some desperately need but I can imagine how others who have tried to be sensible by only having one or two kids and trying to give them the best life possible that their finances allow, may not be best pleased with all the examples

Immigration and welfare reform will be two of the defining issues going into the next election. On the current trajectory, Labour will be pounded on both topics.

Reform and Conservatives now occupy 1-2 in the polls, the Greens have surpassed Labour and it’s possible even LD overtake Labour.

I don’t think Reeves or Starmer will last long, the fallout over SEND school funding has potentially blown away 1/3 of Reeves ‘fiscal headroom’.

 

[Mucca Mad Boys]

People wanted big action on immigration, it goes down by 600,000 and nobody from the right of this forum has anything to say about it.

Immigration hasn’t gone down… the number of people that have emigrated has gone up. Most EU and young Britons, around 2/3rds being 18-34 years old.

Successful net-contributors are leaving and meanwhile, we’re importing low income, low skill people.

 

[CCFCSteve]

Immigration and welfare reform will be two of the defining issues going into the next election. On the current trajectory, Labour will be pounded on both topics.

Reform and Conservatives now occupy 1-2 in the polls, the Greens have surpassed Labour and it’s possible even LD overtake Labour.

I don’t think Reeves or Starmer will last long, the fallout over SEND school funding has potentially blown away 1/3 of Reeves ‘fiscal headroom’.

I think after Mahmoods suggested policy changes and recent data they might well address immigration issue by next election. Not totally but sufficiently that it’s less of an issue

 

[Mucca Mad Boys]

I think after Mahmoods suggested policy changes and recent data they might well address immigration issue by next election. Not totally but sufficiently that it’s less of an issue

We’ll see but smacks of ‘Rwanda Plan’ again where the policies will be frustrated in the courts. If it fails, it’s untenable to argue we shouldn’t leave the ECHR.

Likewise, we’re still handing out 850k visas a year and a v small % of those are to high wage individuals.

44% of net migration is asylum seekers, which is nuts and goes some way to show just damaging this is on society and the economy as a whole. The employment rate of refugees is little over 70% even after 8 years and where they are employed, it’s low income work. For example, c. 50% of Afghan nations are on £15k or less per year.

A complete roll back is needed here.

 

[Sick Boy]

We’ll see but smacks of ‘Rwanda Plan’ again where the policies will be frustrated in the courts. If it fails, it’s untenable to argue we shouldn’t leave the ECHR.

Likewise, we’re still handing out 850k visas a year and a v small % of those are to high wage individuals.

44% of net migration is asylum seekers, which is nuts and goes some way to show just damaging this is on society and the economy as a whole. The employment rate of refugees is little over 70% even after 8 years and where they are employed, it’s low income work. For example, c. 50% of Afghan nations are on £15k or less per year.

A complete roll back is needed here.

The low skilled workers continuing was going to be inevitable after Brexit. I really don’t know what people were expecting.

 

[fernandopartridge]

Its not just the foreign recipients (I’m aware of the data and Reform will definitely play in this) that will cause resentment

The mirror printed an article yesterday that was highlighting the help some desperately need but I can imagine how others who have tried to be sensible by only having one or two kids and trying to give them the best life possible that their finances allow, may not be best pleased with all the examples

We either increase the birth rate or accept that we need immigration to provide the services necessary for an increasing aged population. This is the problem with debate in the UK, the starting point is always spite not logic.,

 

[CCFCSteve]

We either increase the birth rate or accept that we need immigration to provide the services necessary for an increasing aged population. This is the problem with debate in the UK, the starting point is always spite not logic.,

Don’t disagree. But there’s more nuance to it. Do you want large numbers of kids born into borderline poverty just to up the overall birth rate ? Do you want to increase low pay/low skill immigration who over their lifetime will be a net cost to the state, just to bump the total numbers ?

Just chucking random large numbers at the problem isn’t the solution as we’ve found in recent years

 

[Brighton Sky Blue]

You draw a lot of references to Scandi countries, and is a source of inspiration from people like Torsten Bell.

Our taxation system is more 'progressive' than the Scandanavian countries because our tax burden is placed heavily on high earners. The PAYE thresholds means that your average worker on 25k will pay 1/6th of their counterpart in Denmark and 1/4 of their Swedish counterpart in taxation.

Even more significantly, both countries are homogenous and have high level of societal trust and because they haven't had millions of migrants. You '' reacted to a post where I said that lifting the 2 child benefit cap despite it being absolutely true (1 in 3 families on the benefit are foreign born) and 1 in 6 UC claimants are foreign-born, these kind societal changes that build resentment. Reform and Conservative will be able to castigate the budget for funding large migrant families and unfortunately, it's true.

If you truly want to replicate Scandi society, you'd need to start with migration otherwise resentment builds v quickly.

I gave you the react for turning the post into another smear of foreigners. Ignoring the other smears you’re fond of carrying out on public sector workers, the unemployed and so on.

When it comes to deciding what kind of society I want to model this country on, the countries which have scored highest for happiness for years are a good place to start. Places that manage to have very high trade union membership while also being business friendly, high taxes and living costs but the state delivers value for money in return, where we manage to promote healthier work-life balances and incentivise rather than disincentivise starting families…do they get everything spot on of course not. These are ‘tax and spend’ societies who have done a better job of keeping their citizens happy than anywhere else.

You said elsewhere that immigration hasn’t gone down. Net immigration is down by 600,000. I really don’t know how the discussion carries on when you’re in denial of the facts.

 

[fernandopartridge]

Don’t disagree. But there’s more nuance to it. Do you want large numbers of kids born into borderline poverty just to up the overall birth rate ? Do you want to increase low pay/low skill immigration who over their lifetime will be a net cost to the state, just to bump the total numbers ?

Just chucking random large numbers at the problem isn’t the solution as we’ve found in recent years

The bigger picture answer is that the property (both buying and renting) market needs a huge correction. I know it isn't politically palatable but without solving that major issue, everything else is tinkering around the edges.

 

[Mucca Mad Boys]

We either increase the birth rate or accept that we need immigration to provide the services necessary for an increasing aged population. This is the problem with debate in the UK, the starting point is always spite not logic.,

What’s ’logical’ here? I’d rather accept an aging population than importing hundreds of thousands or even millions of low income, low net worth individuals who will be a net-drain. So too would the electorate, no one voted for 900k immigration per year.

27-37% of non-EU migrants are on UC and over time these people will claim the pension scheme so justifying immigration because the population is aging is a Ponzi scheme - it begets more immigration. In any case, low income migration (defined as earning less than 35k pa) is more costly to the treasury.

The starting point for any government is to enact polices to favour marriage and family building.

I gave you the react for turning the post into another smear of foreigners. Ignoring the other smears you’re fond of carrying out on public sector workers, the unemployed and so on.

When it comes to deciding what kind of society I want to model this country on, the countries which have scored highest for happiness for years are a good place to start. Places that manage to have very high trade union membership while also being business friendly, high taxes and living costs but the state delivers value for money in return, where we manage to promote healthier work-life balances and incentivise rather than disincentivise starting families…do they get everything spot on of course not. These are ‘tax and spend’ societies who have done a better job of keeping their citizens happy than anywhere else.

You said elsewhere that immigration hasn’t gone down. Net immigration is down by 600,000. I really don’t know how the discussion carries on when you’re in denial of the facts.

It’s not a smear if it’s true, let’s get that straight.

898k visa being issued is still a near-record high, it’s just been offset by record emigration. The issue is that the outflows of UK and EU nationals is being netted off by inflows of non-EU nationals… in short, net-tax contributors are leaving and replaced by populations that will be a net-tax drain.

 

[CCFCSteve]

The bigger picture answer is that the property (both buying and renting) market needs a huge correction. I know it isn't politically palatable but without solving that major issue, everything else is tinkering around the edges.

I was expecting one after Covid and then again when rates spiked around Ukraine war and it’s just not happened (moral of the story don’t follow my predictions !!!). The problem is net migration has significantly outpaced house building, throw in people living longer and demand has just been outstripping supply for a while. So I’m not sure where the big correction is coming from, unless it’s a decent recession…also not particularly politically palatable

 

[wingy]

I was expecting one after Covid and then again when rates spiked around Ukraine war and it’s just not happened (moral of the story don’t follow my predictions !!!). The problem is net migration has significantly outpaced house building, throw in people living longer and demand has just been outstripping supply for a while. So I’m not sure where the big correction is coming from, unless it’s a decent recession…also not particularly politically palatable

Has this apparent shortage of spending power anything to do with my theory that inflation is basically like an upwards filter,thus leading to an asset frenzy from the big boys I guess for want of a better term?

 

[Mucca Mad Boys]

I was expecting one after Covid and then again when rates spiked around Ukraine war and it’s just not happened (moral of the story don’t follow my predictions !!!). The problem is net migration has significantly outpaced house building, throw in people living longer and demand has just been outstripping supply for a while. So I’m not sure where the big correction is coming from, unless it’s a decent recession…also not particularly politically palatable

The housing market won’t correct itself whilst net migration outpaces house building, this is a very basic numbers game that many people chose not to grasp.

I’ve had conversations with people who will genuinely look you in the eye and say ‘the government should just build more’ in relation to hospitals, schools, roads and of course, house building, an unbelievably naive take. As Labour are finding out, good intentions doesn’t get things done.