Entry-level jobs in freefall after launch of ChatGPT
There were 214,934 entry-level jobs on offer in May this year, down by 32pc from just three years ago, according to figures from online jobs board Adzuna. This decline is outpacing the number of overall vacancies, which have fallen from 1,091,909 to 858,465, or 21pc, over the same period.
“2025 looks like one of the most challenging years we’ve ever seen for 18 to 25-year-old jobseekers. Economic uncertainty, stagnant growth, low business confidence and sticky inflation are all contributing to rates of entry-level hiring being down significantly year on year."
I role of LLMs in this is probably being overstated as a lot of businesses are still very wary / sceptical, all the other conditions thrown in though lead to a terrible mix.
My son nearly had a fit when his son, four or five years ago, suggested doing a degree in Golf Management. Turns out it might have been a better bet than that which he actually did, history.
Even history is probably more use than Romanticism and the Lakes - which is what twin B did.
She is starting to regret her chose of GCSEs which rather limited her options forever afterwards as I warned her at the time.
Grandson has, post degree, gone to Australia on a work visa. Valid for a year, easily apparently, extendable to two. Currently working in a bar, which he did while at Uni. Doesn't, ATM, know where, or what he'll end up doing.
He'll need to work out quickly as he will need to fit into a particular category. I have a lot of family there. Most went to Sydney on visas but the last one had to go to Western Australia due to restriction on visa numbers. None of the second generation have any interest in coming back here.
I wouldn't surprised if he didn't come back. Apparently/allegedly doing bar work to support himself while he 'looks around'. Agree, Western Australia looks a good bet.
They recently released Claude Code. You install it into your terminal and any application that can access the terminal can be injected with Claude Code, in addition they have ability to hook up to external APIs for things like help desk tickets, documentation etc.
The idea is you tell it there is a particular task you want solving. It plans it, then you say ok off you go. Depending on the task, minutes or hours later, having made all changes across code, help desk tickets, documentation, it basically returns finished.....Now you can try and look through all the things it has done but it quickly becomes incredibly difficult to track everything that has been altered as it goes through multiple rounds of adjusting things.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
On a pure capitalist basis yes but that would probably have led not just to recession but depression and mass unemployment not seen since the 1930s and we all know where that led.
The remaining banks would also have stopped lending to businesses large and small and getting a mortgage would have become near impossible
It's hard to know that actual consequences of Max's preferred policy.
While what you suggest was absolutely a risk, it might still have left us in a better state than we are now. Something along the lines of the Asian financial crisis of the late 90s is also a possibility. And it would have put in place a far healthier set of incentives - and a far better public appreciation of the consequences of financial risk - than what we now have.
The 'bumps' people suggest are the result of matters outside the government's control - GFC and QE, Covid and lockdown, Ukraine and Energy costs etc. Other countries have managed these crises without government intervention - Iceland, Sweden, Taiwan and Uruguay for Covid. Iceland (again) for the banks.
So to pose the question? Are Western governments so afraid of their populace that they will simply pay-up to avoid confrontation with media-induced frenzies and pass the cost onto future generations?
Have we all reached the 'bread and circuses' stage?
The interesting thing here, for me, is how much bigger the impact was from GFC than from Covid. I'm not sure we fully appreciated the impact at the time of the GFC (I didn't!)
IIRC Alastair Darling's borrowing forecasts increased by over half a trillion between two statements to the House.
Half the people I worked with lost their jobs (through no fault of their own or the business).
While some guardianistas joked about the 'mancession'.
The issue isn't that debt heads up during times of crisis; it's that it doesn't look as if it's particularly heading down during the good times. And yes, right now *should* be a good time debt wise with oil prices fairly low, stock markets buoyant and ourselves not directly involved in a major war.
Historically there wasn't a particular debt spike in the 30s for the very late 20s stock market crash either - which suggests perhaps too much state intervention following the GFC... - various large wars (Napoleonic; WW1; WW2) did put the debt up but following those wars we were obviously able to run a surplus to get things back under control again.
Too much state intervention = too much welfarism.
Time to take the hatchet to benefits and public service waste.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
Yes because it is not as if the banking system is deeply integrated into the wider economy. Obviously wages would be paid as normal and trade payments and receipts continue without banks. Or would they?
The trouble with simplistic ‘rescue X and let Y die’ solutions is the whole system is interlocked in unknown and probably unknowable ways.
The fear of systemic risk argument looks much weaker after covid. The government has the power to just do things.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
And it was that fateful decision not to rescue Lehmans (also turned down by London for obvious reasons) that detonated the Global Financial Crisis.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
Because - unlike various others including some leading LibDems, the Tories weren't calling for tighter regulation nor warning about the dangers ahead, but actually criticising the existing level of regulation and calling for deregulation
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
On a pure capitalist basis yes but that would probably have led not just to recession but depression and mass unemployment not seen since the 1930s and we all know where that led.
The remaining banks would also have stopped lending to businesses large and small and getting a mortgage would have become near impossible
One or two years of dysfunction to fix the problems vs what are we up to now almost 20 years of various industries begging for bailouts, the state being expected to step in at the first sign someone might lose their job and zombie companies who should have gone bankrupt years ago but survived because monetary conditions were so loose.
Adam Curtis, in discussion with Russell Brand about "Hypernormalisation". For those who cannot stand Russell Brand, here is a video with Brand edited out. https://www.youtube.com/watch?v=MIHC4NNScEI&t=1550s
This is why Starmer should not be Prime Minister. Without an inner core he cannot cope with the chaos of the world. He does not have the qualities necessary for the job.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
Because - unlike various others including some leading LibDems, the Tories weren't calling for tighter regulation nor warning about the dangers ahead, but actually criticising the existing level of regulation and calling for deregulation
That's such a simplistic analysis. There isn't a linear sliding scale where more regulation = good and less regulation = bad. It's possible to overlook systemic issues while also having a regulatory burden that is too big.
Opening a new front in the battle to modernise, she tells The House that elements of parliamentary language – such as ‘bills’ and ‘divisions’ – should be reviewed, as they can be confusing.
“One thing that we’ve heard quite strongly is where things have got a name or are given a title that doesn’t actually speak to what it is. I think people actually don’t even understand the term ‘bill’, let alone all the myriad of different versions of that. We all get emails every day about a Ten-Minute Rule Bill. What is a Ten-Minute Rule Bill? The public don’t know that… It’s a bill that’s not actually a bill. It’s not really going anywhere – it’s a title. Or the way that we call things divisions and not just votes. Do people understand what they actually mean?”
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Brown was a megolamaniac nutter, totally useless and unsuited to ever be PM. I would not have let the clown run a bath.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I suspect they looked at that, had a think about how much was involved in guaranteeing 100% of customer deposits when it actually had to be done, and decided that the course they took, while immoral and terrible, was less immoral and terrible than all the others. The knock on effects of all banks and deposit takers going under at the same time are not really possible to calculate.
The heart of the matter is elsewhere. Deposit takers were then and still are under massive government regulation. That regulation, as well as the banks themselves, failed to manage risk properly.
Once you move away from the Victorian age 'caveat emptor' then government has no choice but to take responsibility.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
And it was that fateful decision not to rescue Lehmans (also turned down by London for obvious reasons) that detonated the Global Financial Crisis.
It was the biggest shock leading to the GFC yes but at least one bank had to be allowed to go bust pour encourager les autres.
Had all banks and building societies in trouble been allowed to go bust with no bailout though then yes we really would have had a second Great Depression and mass unemployment
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Actually that's not quite true: the whole developed world started using Basel-2 Risk Based Capital metrics for banking solvency, and that dramatically understated the riskiness of residential mortgages. (Or perhaps more accurately, it was an example of Soros's reflexively, where the apparent risklessness of mortgages drove their availability, and therefore made them riskier.)
It still beggars belief that we bought into the US group think on the mortage debt when we had very recent experience of a house price crash right here, and especially in the south east.
25% house price inflation should have been setting off all sorts of alarm bells.
BBC it has released a statement about Bob Vylan’s comments at his Glastonbury set...
"The team were dealing with a live situation but with hindsight we should have pulled the stream during the performance. We regret this did not happen."
Funny, he has been ranting like this at other festivals across Europe and a long history of it. Who would have thought he would also do it as Glastonbury. It will be good for his gig sales though as all publicity is good publicity.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
Because - unlike various others including some leading LibDems, the Tories weren't calling for tighter regulation nor warning about the dangers ahead, but actually criticising the existing level of regulation and calling for deregulation
An evidence free statement, the only speech we have on record is Peter Lilley telling the government their reforms would all go bang so I refute your framing entirely. Labour hugely increased the amount of financial regulation from 2001 to 2007, did that work out well?
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
On a pure capitalist basis yes but that would probably have led not just to recession but depression and mass unemployment not seen since the 1930s and we all know where that led.
The remaining banks would also have stopped lending to businesses large and small and getting a mortgage would have become near impossible
It's hard to know that actual consequences of Max's preferred policy.
While what you suggest was absolutely a risk, it might still have left us in a better state than we are now. Something along the lines of the Asian financial crisis of the late 90s is also a possibility. And it would have put in place a far healthier set of incentives - and a far better public appreciation of the consequences of financial risk - than what we now have.
The Asian financial crisis saw slumps in currency values and stocks but not a mass collapse of banks as in this scenario
The “do a trade instead” discussion has been done to death on the various AI subreddits. The problem is that if there is mass unemployment in white collar office jobs then everyone will be forced also learn a trade, massively depressing salaries.
The fact is that the knock on effects in the economy will affect everyone.
Yesterday Trump threatens to withhold aid to Israel unless the court reverses their decision to move forward with Netanyahu’s trial. Today Israeli court reverses their decision and postpones it. What a joke.,/I> https://x.com/RonFilipkowski/status/1939345511355687035
Entry-level jobs in freefall after launch of ChatGPT
There were 214,934 entry-level jobs on offer in May this year, down by 32pc from just three years ago, according to figures from online jobs board Adzuna. This decline is outpacing the number of overall vacancies, which have fallen from 1,091,909 to 858,465, or 21pc, over the same period.
“2025 looks like one of the most challenging years we’ve ever seen for 18 to 25-year-old jobseekers. Economic uncertainty, stagnant growth, low business confidence and sticky inflation are all contributing to rates of entry-level hiring being down significantly year on year."
I role of LLMs in this is probably being overstated as a lot of businesses are still very wary / sceptical, all the other conditions thrown in though lead to a terrible mix.
My son nearly had a fit when his son, four or five years ago, suggested doing a degree in Golf Management. Turns out it might have been a better bet than that which he actually did, history.
Yes, it is ironic that a number of Micky Mouse degrees are actually more vocational than traditional subjects, where university is more of a finishing school and networking opportunity.
There are plenty of proper Micky Mouse degrees. The wide argument is that seemingly all Higher Education have been turned into a 3-4 full time degree. Golf Course Management i.e. Green's Keeping, is a real vocation and you require to know a fair bit about a lot of things around turf technology. Does that require a 3 year full time degree and racking up £50k in debt (which in reality will never be paid off) or is a better route you do 2 days a week at college and work at a golf course.
And as I have said before, the other issue is all the these HE institutions becoming universities, they then have to offer a much wider range of courses (many of which are outside their areas of specialism) and somebody somewhere has to foot the bill for all the facilities that a university requires compared to a HE college.
Probably not - though if that's what you end up doing, it's still far better value than blowing £50k on a history degree. (Even if the latter would be of far greater value to me.)
Not if you want to be a history teacher or professor or work in a museum
I was talking about of you ended up in golf course management (or an equivalent trade).
The argument was about Mickey Mouse / vocational degrees. My point is that while they certainly ought to be far better structured (something along the lines of part time study coupled with apprenticeship, perhaps), for those ending up in those jobs they're still far better value than an art degree.
In monetary terms unless you want to be an artist and end up the next Damian Hirst or Tracey Emin
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
It's a little more complex than that: one person's saving is another one's debt. When is becomes clear that not all the debts will be repaid, then - one way or another - the value of savings need to be diminished. That can either be done via inflation, socialization, or the collapse of the banking system. (Guaranteeing all the deposits is just one of the forms of socialization.)
The “do a trade instead” discussion has been done to death on the various AI subreddits. The problem is that if there is mass unemployment in white collar office jobs then everyone will be forced also learn a trade, massively depressing salaries.
The fact is that the knock on effects in the economy will affect everyone.
I think most governments in the West is just hope that a) the take over of certain jobs by AI is quite slow and b) pray something else comes up in the meantime.
The “do a trade instead” discussion has been done to death on the various AI subreddits. The problem is that if there is mass unemployment in white collar office jobs then everyone will be forced also learn a trade, massively depressing salaries.
The fact is that the knock on effects in the economy will affect everyone.
And in that scenario a UBI funded by a robot tax becomes inevitable, no party could ever be elected to office again otherwise
The 'bumps' people suggest are the result of matters outside the government's control - GFC and QE, Covid and lockdown, Ukraine and Energy costs etc. Other countries have managed these crises without government intervention - Iceland, Sweden, Taiwan and Uruguay for Covid. Iceland (again) for the banks.
So to pose the question? Are Western governments so afraid of their populace that they will simply pay-up to avoid confrontation with media-induced frenzies and pass the cost onto future generations?
Have we all reached the 'bread and circuses' stage?
The interesting thing here, for me, is how much bigger the impact was from GFC than from Covid. I'm not sure we fully appreciated the impact at the time of the GFC (I didn't!)
...We entered Covid from a baseline of falling debt to GDP...
Did we? From the graph it appears that debt as a %age of GDP was either stable or very slowly dropping, which makes me think that nominal debt was still rising, albeit slowly.
Falling debt to GDP != falling debt.
The percentage of GDP = debt to GDP, so if the percentage is falling, then the debt to GDP is falling. As we entered Covid, the percentage was going down in the immediately preceding years.
It is possible to have a deficit and falling debt to GDP. If your deficit is less than inflation and growth combined then debt to GDP will fall.
Growth plus inflation ought to give a fairly healthy window of opportunity for lowering debt to GDP even without a budget surplus, which is preferred.
In 2002 we had an actual surplus, great.
In 2019/20 we had a deficit, not great, but it was small enough that debt to GDP was falling at least. Good but not great.
In 2007/08 we had a deficit so big that debt to GDP was rising, even after inflation and growth, even before the crisis hit. Terrible.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I suspect they looked at that, had a think about how much was involved in guaranteeing 100% of customer deposits when it actually had to be done, and decided that the course they took, while immoral and terrible, was less immoral and terrible than all the others. The knock on effects of all banks and deposit takers going under at the same time are not really possible to calculate.
The heart of the matter is elsewhere. Deposit takers were then and still are under massive government regulation. That regulation, as well as the banks themselves, failed to manage risk properly.
Once you move away from the Victorian age 'caveat emptor' then government has no choice but to take responsibility.
Nonsense, depositors are made senior creditors, subordinating all bondholders, employees and HMRC. The government provides liquidity while bank assets are sold to pay the state back for the immediate liquidity to ensure depositors are protected.
I think the calculation was, shit these two big Scottish banks are about to go under, the PM and Chancellor are Scottish and this is going to be hugely embarrassing for them so bail one out and force Lloyds down the aisle with HBOS.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
It's a little more complex than that: one person's saving is another one's debt. When is becomes clear that not all the debts will be repaid, then - one way or another - the value of savings need to be diminished. That can either be done via inflation, socialization, or the collapse of the banking system. (Guaranteeing all the deposits is just one of the forms of socialization.)
One person's savings were ~70 people's debt, surely, at least for RBS, being very simplistic.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
And it was that fateful decision not to rescue Lehmans (also turned down by London for obvious reasons) that detonated the Global Financial Crisis.
Crises happen. The idea you can abolish crises is preposterous.
Bad businesses fail and should be allowed to fail. Lehman's did a bad job and paid the price. Northern Rock should have paid the price too.
Deposit protection schemes exist, they should have been implemented for Northern Rock's customers and any other failed business.
The bigger problem is not that the crisis happened, crises happen. Crises should be planned for.
The bigger problem is how horrifically exposed we were to the crisis. When the crisis hit, we already had rising debt to GDP, our situation was that bad even pre-crisis which meant we were vulnerable to any crisis tipping us over the edge as we had nowhere to go but disaster when the next, inevitable, crisis came.
We have talked before about the over medication and prescribed addictions in this country. 43% of Labour voters think this government has things under control? I want some of what they are having for a happier life.
More alarmingly, 18% of the population, 1 in 5, think things are under control. That means that on my next jury of 15 there are probably 3 members who are utterly delusional.
Let me guess, do you read the daily mail or the telegraph?
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I suspect they looked at that, had a think about how much was involved in guaranteeing 100% of customer deposits when it actually had to be done, and decided that the course they took, while immoral and terrible, was less immoral and terrible than all the others. The knock on effects of all banks and deposit takers going under at the same time are not really possible to calculate.
The heart of the matter is elsewhere. Deposit takers were then and still are under massive government regulation. That regulation, as well as the banks themselves, failed to manage risk properly.
Once you move away from the Victorian age 'caveat emptor' then government has no choice but to take responsibility.
Nonsense, depositors are made senior creditors, subordinating all bondholders, employees and HMRC. The government provides liquidity while bank assets are sold to pay the state back for the immediate liquidity to ensure depositors are protected.
I think the calculation was, shit these two big Scottish banks are about to go under, the PM and Chancellor are Scottish and this is going to be hugely embarrassing for them so bail one out and force Lloyds down the aisle with HBOS.
Max, last bit is pure bollox, dumping those two would have wrecked the country totally.
Opening a new front in the battle to modernise, she tells The House that elements of parliamentary language – such as ‘bills’ and ‘divisions’ – should be reviewed, as they can be confusing.
“One thing that we’ve heard quite strongly is where things have got a name or are given a title that doesn’t actually speak to what it is. I think people actually don’t even understand the term ‘bill’, let alone all the myriad of different versions of that. We all get emails every day about a Ten-Minute Rule Bill. What is a Ten-Minute Rule Bill? The public don’t know that… It’s a bill that’s not actually a bill. It’s not really going anywhere – it’s a title. Or the way that we call things divisions and not just votes. Do people understand what they actually mean?”
I think a bunch of no-marks on the committee want to get their names into the history books. Renaming different types of bill will not eliminate their distinctions, it will simply mean people can't look them up in old books, web pages or ChatGPT.
It is the DOGE thing writ small. They need to change procedures, not randomly sack people or change names while leaving the underlying processes in place.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
It's a little more complex than that: one person's saving is another one's debt. When is becomes clear that not all the debts will be repaid, then - one way or another - the value of savings need to be diminished. That can either be done via inflation, socialization, or the collapse of the banking system. (Guaranteeing all the deposits is just one of the forms of socialization.)
One person's savings were ~70 people's debt, surely, at least for RBS, being very simplistic.
Not quite: the 70:1 ratio is the ratio of loans to shareholder's equity, not to ratio of loans to deposits (which was much closer to 1:1).
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I suspect they looked at that, had a think about how much was involved in guaranteeing 100% of customer deposits when it actually had to be done, and decided that the course they took, while immoral and terrible, was less immoral and terrible than all the others. The knock on effects of all banks and deposit takers going under at the same time are not really possible to calculate.
The heart of the matter is elsewhere. Deposit takers were then and still are under massive government regulation. That regulation, as well as the banks themselves, failed to manage risk properly.
Once you move away from the Victorian age 'caveat emptor' then government has no choice but to take responsibility.
Nonsense, depositors are made senior creditors, subordinating all bondholders, employees and HMRC. The government provides liquidity while bank assets are sold to pay the state back for the immediate liquidity to ensure depositors are protected.
I think the calculation was, shit these two big Scottish banks are about to go under, the PM and Chancellor are Scottish and this is going to be hugely embarrassing for them so bail one out and force Lloyds down the aisle with HBOS.
You can't do that with bonds that have first call on certain assets. (I.e. secured creditors.)
The Reform UK Notts CC Council Leader seems to be trying to reduce public scrutiny:
1 - He is restricting the ability of Opposition Councillors to ask questions in public meetings. In the Constitution they get a submitted question, and a supplementary.
2 - This is important amongst other things because, as we remarked on Election night, Notts has a sharp NNW/SSE divide between RefUK and everyone else. I'm at the the turquoise end, obviously .
He could change it by making a proposal for amendment under normal procedure and rules, making his argument and winning the vote in full council, but he hasn't. He should know this, as he has a staff of senior officers to advise him.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I suspect they looked at that, had a think about how much was involved in guaranteeing 100% of customer deposits when it actually had to be done, and decided that the course they took, while immoral and terrible, was less immoral and terrible than all the others. The knock on effects of all banks and deposit takers going under at the same time are not really possible to calculate.
The heart of the matter is elsewhere. Deposit takers were then and still are under massive government regulation. That regulation, as well as the banks themselves, failed to manage risk properly.
Once you move away from the Victorian age 'caveat emptor' then government has no choice but to take responsibility.
Nonsense, depositors are made senior creditors, subordinating all bondholders, employees and HMRC. The government provides liquidity while bank assets are sold to pay the state back for the immediate liquidity to ensure depositors are protected.
I think the calculation was, shit these two big Scottish banks are about to go under, the PM and Chancellor are Scottish and this is going to be hugely embarrassing for them so bail one out and force Lloyds down the aisle with HBOS.
Oh FFS. Write down a list of banks. Cross out three quarters of those banks. Now explain how your employer will pay your salary, how it will pay its suppliers, and how it will be paid for goods or services supplied. Everything is interlinked.
Adam Curtis, in discussion with Russell Brand about "Hypernormalisation". For those who cannot stand Russell Brand, here is a video with Brand edited out. https://www.youtube.com/watch?v=MIHC4NNScEI&t=1550s
This is why Starmer should not be Prime Minister. Without an inner core he cannot cope with the chaos of the world. He does not have the qualities necessary for the job.
Regrettably Adam Curtis has slightly gone down in my estimation after he put falsehoods into his latest documentary, which were pointed out recently by the BBC's More Or Less radio programme (and Prof John Curtice). Curtis admitted to the mistakes when they were pointed out. The main one was saying Thatcher was behind during the 1979 election campaign until she made an immigration speech, both not true.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I suspect they looked at that, had a think about how much was involved in guaranteeing 100% of customer deposits when it actually had to be done, and decided that the course they took, while immoral and terrible, was less immoral and terrible than all the others. The knock on effects of all banks and deposit takers going under at the same time are not really possible to calculate.
The heart of the matter is elsewhere. Deposit takers were then and still are under massive government regulation. That regulation, as well as the banks themselves, failed to manage risk properly.
Once you move away from the Victorian age 'caveat emptor' then government has no choice but to take responsibility.
Nonsense, depositors are made senior creditors, subordinating all bondholders, employees and HMRC. The government provides liquidity while bank assets are sold to pay the state back for the immediate liquidity to ensure depositors are protected.
I think the calculation was, shit these two big Scottish banks are about to go under, the PM and Chancellor are Scottish and this is going to be hugely embarrassing for them so bail one out and force Lloyds down the aisle with HBOS.
You can't do that with bonds that have first call on certain assets. (I.e. secured creditors.)
So you call in the administrators and let the process work. Security happens in order of legally-determined security, and deposit-protection schemes kick in where they are legally-determined.
Anything not protected and not secure faces a haircut at the relevant amount.
All this process is already written into law and can be played out under administration. It happened with Lehman's who were still operating under administration (with a skeletal, very small crew) nearly a decade after going into administration and could have been done with Northern Rock.
The problem is jumping onto the tracks to try to stop the train.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
Not sure what has happened to that link but in 2010 Osborne inherited a current account deficit of 7.29% of GDP. This fell every year until in 2019 they were in surplus by a tiny margin. Of course, we then had a change of government and Covid but the Coalition/Cameron government was extremely successful in bringing our books back into balance.
Aaron Bastani @AaronBastani · 22h I don't think it's really clicked for much of political media that reputable pollsters have Labour third in Scotland AND third in Wales.
After next May Starmer will get the boot faster than you can say 'release the sausages'.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
Not sure what has happened to that link but in 2010 Osborne inherited a current account deficit of 7.29% of GDP. This fell every year until in 2019 they were in surplus by a tiny margin. Of course, we then had a change of government and Covid but the Coalition/Cameron government was extremely successful in bringing our books back into balance.
Ummm: are you sure you mean Current Account, which refers to the Trade Deficit + moves in rent, dividends and interest? Or are you talking about budget surplus?
I am fed up with the prominence of the 'Bereaved families' in the proceedings. Yes they suffered loss. Yes it was horrific, yes mistakes were made but this isn't a coroner's inquest for your granny.
But the enquiry should not be about that - we need to plan ahead, stop things happening again. The bereaved are set on persuing blame, and every witness is coming to the stand to defend their actions. We needed a truth and reconciliation not a witch hunt.
And we should be examining the rest of the world to see what worked best (a far better track and trace, early wearing of face masks and a better compliant population as in SE Asia.)
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
Not sure what has happened to that link but in 2010 Osborne inherited a current account deficit of 7.29% of GDP. This fell every year until in 2019 they were in surplus by a tiny margin. Of course, we then had a change of government and Covid but the Coalition/Cameron government was extremely successful in bringing our books back into balance.
Well said. It is deficit, not debt, that is the relevant figure that should be looked at.
Brown took us into a deficit even before the crisis hit, which then blew up (inevitably) when the crisis (inevitably) hit.
The coalition cut the deficit.
The deficit was small enough before the next crisis (inevitably) hit that debt-to-GDP was falling instead of rising, so the next crisis despite being a once-in-a-century pandemic hurt us less than the prior one, as we were better prepared for it.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
It's a little more complex than that: one person's saving is another one's debt. When is becomes clear that not all the debts will be repaid, then - one way or another - the value of savings need to be diminished. That can either be done via inflation, socialization, or the collapse of the banking system. (Guaranteeing all the deposits is just one of the forms of socialization.)
Value is a tricky word. The crisis itself was deflationary, so it's possible that people could have taken a nominal haircut on their savings without the value of those savings being affected.
Aaron Bastani @AaronBastani · 22h I don't think it's really clicked for much of political media that reputable pollsters have Labour third in Scotland AND third in Wales.
After next May Starmer will get the boot faster than you can say 'release the sausages'.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I suspect they looked at that, had a think about how much was involved in guaranteeing 100% of customer deposits when it actually had to be done, and decided that the course they took, while immoral and terrible, was less immoral and terrible than all the others. The knock on effects of all banks and deposit takers going under at the same time are not really possible to calculate.
The heart of the matter is elsewhere. Deposit takers were then and still are under massive government regulation. That regulation, as well as the banks themselves, failed to manage risk properly.
Once you move away from the Victorian age 'caveat emptor' then government has no choice but to take responsibility.
Nonsense, depositors are made senior creditors, subordinating all bondholders, employees and HMRC. The government provides liquidity while bank assets are sold to pay the state back for the immediate liquidity to ensure depositors are protected.
I think the calculation was, shit these two big Scottish banks are about to go under, the PM and Chancellor are Scottish and this is going to be hugely embarrassing for them so bail one out and force Lloyds down the aisle with HBOS.
You can't do that with bonds that have first call on certain assets. (I.e. secured creditors.)
So you call in the administrators and let the process work. Security happens in order of legally-determined security, and deposit-protection schemes kick in where they are legally-determined.
Anything not protected and not secure faces a haircut at the relevant amount.
All this process is already written into law and can be played out under administration. It happened with Lehman's who were still operating under administration (with a skeletal, very small crew) nearly a decade after going into administration and could have been done with Northern Rock.
The problem is jumping onto the tracks to try to stop the train.
I don't disagree with that: I'm just pointing out that if the government elevates certain creditors over others who have precedence, then there is going to be a legal mess. Guaranteeing all deposits means elevating -say- corporate bank accounts over the bank's securitized debt.
Aaron Bastani @AaronBastani · 22h I don't think it's really clicked for much of political media that reputable pollsters have Labour third in Scotland AND third in Wales.
After next May Starmer will get the boot faster than you can say 'release the sausages'.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
It's a little more complex than that: one person's saving is another one's debt. When is becomes clear that not all the debts will be repaid, then - one way or another - the value of savings need to be diminished. That can either be done via inflation, socialization, or the collapse of the banking system. (Guaranteeing all the deposits is just one of the forms of socialization.)
Value is a tricky word. The crisis itself was deflationary, so it's possible that people could have taken a nominal haircut on their savings without the value of those savings being affected.
One person's savings is another's debt.
When you save you are deferring consumption, by sending the fruits of your labor to someone else who is promising to deliver you the fruits of his labor in the future. All a bank is is a very thin sliver of equity between those two people.
And if that guy is unable to deliver the fruits of his labor in the future, then it is said saver who is on the hook.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
Not sure what has happened to that link but in 2010 Osborne inherited a current account deficit of 7.29% of GDP. This fell every year until in 2019 they were in surplus by a tiny margin. Of course, we then had a change of government and Covid but the Coalition/Cameron government was extremely successful in bringing our books back into balance.
Ummm: are you sure you mean Current Account, which refers to the Trade Deficit + moves in rent, dividends and interest? Or are you talking about budget surplus?
That is the phrase that the source uses but it is the fiscal deficit that it is talking about.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
It's a little more complex than that: one person's saving is another one's debt. When is becomes clear that not all the debts will be repaid, then - one way or another - the value of savings need to be diminished. That can either be done via inflation, socialization, or the collapse of the banking system. (Guaranteeing all the deposits is just one of the forms of socialization.)
Value is a tricky word. The crisis itself was deflationary, so it's possible that people could have taken a nominal haircut on their savings without the value of those savings being affected.
One person's savings is another's debt.
When you save you are deferring consumption, by sending the fruits of your labor to someone else who is promising to deliver you the fruits of his labor in the future. All a bank is is a very thin sliver of equity between those two people.
And if that guy is unable to deliver the fruits of his labor in the future, then it is said saver who is on the hook.
Sure, but a financial crisis doesn't change the demographics, it doesn't destroy machinery and it doesn't render anyone infirm.
When assets get mispriced, you need to allow the deck to be reshuffled and for people who made bad bets to pay the price (and I include making deposits in a risky bank as a bad bet).
Aaron Bastani @AaronBastani · 22h I don't think it's really clicked for much of political media that reputable pollsters have Labour third in Scotland AND third in Wales.
After next May Starmer will get the boot faster than you can say 'release the sausages'.
That’s just wrong. Far be it from me to be a SLab defender but every Holyrood poll this year has them second, aside from one where they’re joint second with Reform. Westminster may be marginally different but the next GE is almost certainly a long way away.
Sorry to bang on about this but - this key question that the bereaved want answered - "There are key questions families and care staff want answered - including why the decision was made in March 2020 to rapidly discharge some hospital patients into care homes."
I can tell them - the powers that be thought that hospitals were going to be over run. Job done, can I have my millions please?
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
It's a little more complex than that: one person's saving is another one's debt. When is becomes clear that not all the debts will be repaid, then - one way or another - the value of savings need to be diminished. That can either be done via inflation, socialization, or the collapse of the banking system. (Guaranteeing all the deposits is just one of the forms of socialization.)
Value is a tricky word. The crisis itself was deflationary, so it's possible that people could have taken a nominal haircut on their savings without the value of those savings being affected.
One person's savings is another's debt.
When you save you are deferring consumption, by sending the fruits of your labor to someone else who is promising to deliver you the fruits of his labor in the future. All a bank is is a very thin sliver of equity between those two people.
And if that guy is unable to deliver the fruits of his labor in the future, then it is said saver who is on the hook.
Sure, but a financial crisis doesn't change the demographics, it doesn't destroy machinery and it doesn't render anyone infirm.
When assets get mispriced, you need to allow the deck to be reshuffled and for people who made bad bets to pay the price (and I include making deposits in a risky bank as a bad bet).
All of this academic commentary assumes that depositors are playing “capitalism”. In their eyes, they are not. They are just putting their hard-earned savings in what they think is a safe place for later use.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
Because - unlike various others including some leading LibDems, the Tories weren't calling for tighter regulation nor warning about the dangers ahead, but actually criticising the existing level of regulation and calling for deregulation
That's such a simplistic analysis. There isn't a linear sliding scale where more regulation = good and less regulation = bad. It's possible to overlook systemic issues while also having a regulatory burden that is too big.
Can we forecast the future by analysing the past? There is a lot of rear view mirroring going on - which is probably why economies get crashed.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I suspect they looked at that, had a think about how much was involved in guaranteeing 100% of customer deposits when it actually had to be done, and decided that the course they took, while immoral and terrible, was less immoral and terrible than all the others. The knock on effects of all banks and deposit takers going under at the same time are not really possible to calculate.
The heart of the matter is elsewhere. Deposit takers were then and still are under massive government regulation. That regulation, as well as the banks themselves, failed to manage risk properly.
Once you move away from the Victorian age 'caveat emptor' then government has no choice but to take responsibility.
Nonsense, depositors are made senior creditors, subordinating all bondholders, employees and HMRC. The government provides liquidity while bank assets are sold to pay the state back for the immediate liquidity to ensure depositors are protected.
I think the calculation was, shit these two big Scottish banks are about to go under, the PM and Chancellor are Scottish and this is going to be hugely embarrassing for them so bail one out and force Lloyds down the aisle with HBOS.
Racist .... or someone that knows their history. The reason for the Union was a banking crisis in Scotland driven by the person who also was involved in the BoE. Perhaps Scotland should be hived off before they do any more damage.
Ben Habibs new party launched this morning - Advance UK, 1000 initial members apparently. However Rupert Lowe is not joining him, he will remain an indy and is launching an initiative called Restore UK which is not a party but he says an attempt at collaborative efforts etc etc. Reform splitters have split
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
It's a little more complex than that: one person's saving is another one's debt. When is becomes clear that not all the debts will be repaid, then - one way or another - the value of savings need to be diminished. That can either be done via inflation, socialization, or the collapse of the banking system. (Guaranteeing all the deposits is just one of the forms of socialization.)
Value is a tricky word. The crisis itself was deflationary, so it's possible that people could have taken a nominal haircut on their savings without the value of those savings being affected.
One person's savings is another's debt.
When you save you are deferring consumption, by sending the fruits of your labor to someone else who is promising to deliver you the fruits of his labor in the future. All a bank is is a very thin sliver of equity between those two people.
And if that guy is unable to deliver the fruits of his labor in the future, then it is said saver who is on the hook.
Sure, but a financial crisis doesn't change the demographics, it doesn't destroy machinery and it doesn't render anyone infirm.
When assets get mispriced, you need to allow the deck to be reshuffled and for people who made bad bets to pay the price (and I include making deposits in a risky bank as a bad bet).
All of this academic commentary assumes that depositors are playing “capitalism”. In their eyes, they are not. They are just putting their hard-earned savings in what they think is a safe place for later use.
Which is why deposit protection schemes, and limits, exist.
Anyone who has exceeded the limits, is acting unsafely, and should be aware of that.
Sorry to bang on about this but - this key question that the bereaved want answered - "There are key questions families and care staff want answered - including why the decision was made in March 2020 to rapidly discharge some hospital patients into care homes."
I can tell them - the powers that be thought that hospitals were going to be over run. Job done, can I have my millions please?
FFS
And that assumption was based on hopeless modelling driven by the likes of the useless Ferguson..💩
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
It's a little more complex than that: one person's saving is another one's debt. When is becomes clear that not all the debts will be repaid, then - one way or another - the value of savings need to be diminished. That can either be done via inflation, socialization, or the collapse of the banking system. (Guaranteeing all the deposits is just one of the forms of socialization.)
Value is a tricky word. The crisis itself was deflationary, so it's possible that people could have taken a nominal haircut on their savings without the value of those savings being affected.
One person's savings is another's debt.
When you save you are deferring consumption, by sending the fruits of your labor to someone else who is promising to deliver you the fruits of his labor in the future. All a bank is is a very thin sliver of equity between those two people.
And if that guy is unable to deliver the fruits of his labor in the future, then it is said saver who is on the hook.
Sure, but a financial crisis doesn't change the demographics, it doesn't destroy machinery and it doesn't render anyone infirm.
When assets get mispriced, you need to allow the deck to be reshuffled and for people who made bad bets to pay the price (and I include making deposits in a risky bank as a bad bet).
All of this academic commentary assumes that depositors are playing “capitalism”. In their eyes, they are not. They are just putting their hard-earned savings in what they think is a safe place for later use.
Up to a point. If someone makes a decision to put their money in an Icelandic savings account offering a higher rate of interest, they should be conscious that they are taking on additional risk.
Sorry to bang on about this but - this key question that the bereaved want answered - "There are key questions families and care staff want answered - including why the decision was made in March 2020 to rapidly discharge some hospital patients into care homes."
I can tell them - the powers that be thought that hospitals were going to be over run. Job done, can I have my millions please?
FFS
And that assumption was based on hopeless modelling driven by the likes of the useless Ferguson..💩
No. It was based on the assumption that patients not actually ill were not infectious. Sadly that assumption was false.
Looks like trains north of Carlisle have been cancelled due to a tree falling on top of the overheard wires. (We were due to pick someone up who was travelling from Edinburgh to England this evening but looks like they might be spending an extra night there).
Ben Habibs new party launched this morning - Advance UK, 1000 initial members apparently. However Rupert Lowe is not joining him, he will remain an indy and is launching an initiative called Restore UK which is not a party but he says an attempt at collaborative efforts etc etc. Reform splitters have split
Are they not learning from the recent past from the left side of politics, Change UK, Renew, True and Fair Party, ....
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
It's a little more complex than that: one person's saving is another one's debt. When is becomes clear that not all the debts will be repaid, then - one way or another - the value of savings need to be diminished. That can either be done via inflation, socialization, or the collapse of the banking system. (Guaranteeing all the deposits is just one of the forms of socialization.)
Value is a tricky word. The crisis itself was deflationary, so it's possible that people could have taken a nominal haircut on their savings without the value of those savings being affected.
One person's savings is another's debt.
When you save you are deferring consumption, by sending the fruits of your labor to someone else who is promising to deliver you the fruits of his labor in the future. All a bank is is a very thin sliver of equity between those two people.
And if that guy is unable to deliver the fruits of his labor in the future, then it is said saver who is on the hook.
Sure, but a financial crisis doesn't change the demographics, it doesn't destroy machinery and it doesn't render anyone infirm.
When assets get mispriced, you need to allow the deck to be reshuffled and for people who made bad bets to pay the price (and I include making deposits in a risky bank as a bad bet).
All of this academic commentary assumes that depositors are playing “capitalism”. In their eyes, they are not. They are just putting their hard-earned savings in what they think is a safe place for later use.
Up to a point. If someone makes a decision to put their money in an Icelandic savings account offering a higher rate of interest, they should be conscious that they are taking on additional risk.
Iceland handled the crisis very well indeed.
They didn't try to "save" their banks and allowed them to fail, implementing the deposit protection schemes.
Those who were protected, got their protections, up to pre-existing limits.
Those who were not, faced a haircut, as they should.
Creditors faced a haircut, as they should.
The taxpayer did not get an open-ended obligation.
Ben Habibs new party launched this morning - Advance UK, 1000 initial members apparently. However Rupert Lowe is not joining him, he will remain an indy and is launching an initiative called Restore UK which is not a party but he says an attempt at collaborative efforts etc etc. Reform splitters have split
If they had any brains they'd all make up with Farage and present a united front under the FPTP voting system.
In the last 2 days Chelsea have spent another £110m on two players. How are they staying within all these financial fair play rules?
They play the financial game in a way that will work for them as long as they keep qualifying for European football.
They sold their women’s team and hotels to other companies which were owned by the same owners as Chelsea so a huge gain on their books for the football club and no real change to the owners.
They sign players on usually 7 year contracts so that the fees are amortised over a longer peiod. Very good from a pure accounting ploy but dangerous if you get a player banned for doping or falls out and refuses to move as you have to keep paying them for 7 years.
They also have a huge stable of young players out on loan where these players just have to be bought for a few million here or there and they add up to pure profit.
It’s very messed up how their switcheroo with the ladies and the hotels was technically within the rules and also how many players they have out on loan but it’s all allowed and as I wrote, all good unless they really underperform.
Sorry to bang on about this but - this key question that the bereaved want answered - "There are key questions families and care staff want answered - including why the decision was made in March 2020 to rapidly discharge some hospital patients into care homes."
I can tell them - the powers that be thought that hospitals were going to be over run. Job done, can I have my millions please?
FFS
Yes, its absolutely absurd that hindsight is being used in this way to second guess those who had to make calls with a lot of unknown unknowns.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
Yes because it is not as if the banking system is deeply integrated into the wider economy. Obviously wages would be paid as normal and trade payments and receipts continue without banks. Or would they?
The trouble with simplistic ‘rescue X and let Y die’ solutions is the whole system is interlocked in unknown and probably unknowable ways.
The fear of systemic risk argument looks much weaker after covid. The government has the power to just do things.
But that's the point. The government did 'do things'. In both cases (GFC and Covid) they chose to do things to avoid a collapse (financial system, NHS, economy) rather than allow it and do things to try and mitigate its impact.
The reason for this is the consequences of the latter course were potentially catastrophic and impossible to model with any semblance of confidence. It would have been an unconscionable risk to take. They had no realistic alternative. Lab and Con alike, they did their duty.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
And it was that fateful decision not to rescue Lehmans (also turned down by London for obvious reasons) that detonated the Global Financial Crisis.
Crises happen. The idea you can abolish crises is preposterous.
Bad businesses fail and should be allowed to fail. Lehman's did a bad job and paid the price. Northern Rock should have paid the price too.
Deposit protection schemes exist, they should have been implemented for Northern Rock's customers and any other failed business.
The bigger problem is not that the crisis happened, crises happen. Crises should be planned for.
The bigger problem is how horrifically exposed we were to the crisis. When the crisis hit, we already had rising debt to GDP, our situation was that bad even pre-crisis which meant we were vulnerable to any crisis tipping us over the edge as we had nowhere to go but disaster when the next, inevitable, crisis came.
Sounds like Osborne's spin machine from two decades back. Wrong then, irrelevant now.
The graph helpfully pasted earlier shows a gentle, barely discernible rise under Labour and a far steeper one under Cameron/Osborne.
Ben Habibs new party launched this morning - Advance UK, 1000 initial members apparently. However Rupert Lowe is not joining him, he will remain an indy and is launching an initiative called Restore UK which is not a party but he says an attempt at collaborative efforts etc etc. Reform splitters have split
There's a definite problem with tennis without line judges in the sense that when a ball is just in and it's a bit noisy everyone is looking around for some type of confirmation and they didn't hear the automatic call. Previously you would have been able to look at the line judge and see their hand signals for confirmation.
BBC it has released a statement about Bob Vylan’s comments at his Glastonbury set...
"The team were dealing with a live situation but with hindsight we should have pulled the stream during the performance. We regret this did not happen."
Funny, he has been ranting like this at other festivals across Europe and a long history of it. Who would have thought he would also do it as Glastonbury. It will be good for his gig sales though as all publicity is good publicity.
In the last 2 days Chelsea have spent another £110m on two players. How are they staying within all these financial fair play rules?
They play the financial game in a way that will work for them as long as they keep qualifying for European football.
They sold their women’s team and hotels to other companies which were owned by the same owners as Chelsea so a huge gain on their books for the football club and no real change to the owners.
They sign players on usually 7 year contracts so that the fees are amortised over a longer peiod. Very good from a pure accounting ploy but dangerous if you get a player banned for doping or falls out and refuses to move as you have to keep paying them for 7 years.
They also have a huge stable of young players out on loan where these players just have to be bought for a few million here or there and they add up to pure profit.
It’s very messed up how their switcheroo with the ladies and the hotels was technically within the rules and also how many players they have out on loan but it’s all allowed and as I wrote, all good unless they really underperform.
The selling to the same owners trick really is dodgy and should be looked into.
The rest of it though is a bit of a gamble. Manchester United took the same gamble and are paying for it now by not qualifying for Europe and still having to pay eg Marcus Rashford's wages even while he's on loan elsewhere.
The club he's loaned to is only paying a proportion of his wages. And he has no reason to sign a new contract on a transfer at a lower wage until the contract runs out, by which point he can then go on a free transfer.
In the last 2 days Chelsea have spent another £110m on two players. How are they staying within all these financial fair play rules?
They play the financial game in a way that will work for them as long as they keep qualifying for European football.
They sold their women’s team and hotels to other companies which were owned by the same owners as Chelsea so a huge gain on their books for the football club and no real change to the owners.
They sign players on usually 7 year contracts so that the fees are amortised over a longer peiod. Very good from a pure accounting ploy but dangerous if you get a player banned for doping or falls out and refuses to move as you have to keep paying them for 7 years.
They also have a huge stable of young players out on loan where these players just have to be bought for a few million here or there and they add up to pure profit.
It’s very messed up how their switcheroo with the ladies and the hotels was technically within the rules and also how many players they have out on loan but it’s all allowed and as I wrote, all good unless they really underperform.
I didn't think you could do the 7 year trick accounting trick anymore?
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
And it was that fateful decision not to rescue Lehmans (also turned down by London for obvious reasons) that detonated the Global Financial Crisis.
Crises happen. The idea you can abolish crises is preposterous.
Bad businesses fail and should be allowed to fail. Lehman's did a bad job and paid the price. Northern Rock should have paid the price too.
Deposit protection schemes exist, they should have been implemented for Northern Rock's customers and any other failed business.
The bigger problem is not that the crisis happened, crises happen. Crises should be planned for.
The bigger problem is how horrifically exposed we were to the crisis. When the crisis hit, we already had rising debt to GDP, our situation was that bad even pre-crisis which meant we were vulnerable to any crisis tipping us over the edge as we had nowhere to go but disaster when the next, inevitable, crisis came.
Sounds like Osborne's spin machine from two decades back. Wrong then, irrelevant now.
The graph helpfully pasted earlier shows a gentle, barely discernible rise under Labour and a far steeper one under Cameron/Osborne.
What are you talking about? That's completely 100% untrue.
The graph shows immediately prior to 2008 there was a rise under Labour, which then became an even steeper rise once the crisis hit.
The graph shows immediately prior to 2020 there as a decline under the Tories, which then became a shallower rise once the crisis hit.
Adam Curtis, in discussion with Russell Brand about "Hypernormalisation". For those who cannot stand Russell Brand, here is a video with Brand edited out. https://www.youtube.com/watch?v=MIHC4NNScEI&t=1550s
This is why Starmer should not be Prime Minister. Without an inner core he cannot cope with the chaos of the world. He does not have the qualities necessary for the job.
Regrettably Adam Curtis has slightly gone down in my estimation after he put falsehoods into his latest documentary, which were pointed out recently by the BBC's More Or Less radio programme (and Prof John Curtice). Curtis admitted to the mistakes when they were pointed out. The main one was saying Thatcher was behind during the 1979 election campaign until she made an immigration speech, both not true.
Good to know, thank you. Do you have a link to the BBC's More Or Less episode plz?
Correction - Lowe is Restore Britain not Restore UK. Anyway, i cant see Advance troubling the pollsters. They might get to the 1 to 2% Galloway/Workers got to last year at peak and that UKIP were getting before Brexit Party ate the remaining anti EU vote and destroyed them.
His one 'Trump card' (lol) might be Musk who is in discussion with him
In the last 2 days Chelsea have spent another £110m on two players. How are they staying within all these financial fair play rules?
They play the financial game in a way that will work for them as long as they keep qualifying for European football.
They sold their women’s team and hotels to other companies which were owned by the same owners as Chelsea so a huge gain on their books for the football club and no real change to the owners.
They sign players on usually 7 year contracts so that the fees are amortised over a longer peiod. Very good from a pure accounting ploy but dangerous if you get a player banned for doping or falls out and refuses to move as you have to keep paying them for 7 years.
They also have a huge stable of young players out on loan where these players just have to be bought for a few million here or there and they add up to pure profit.
It’s very messed up how their switcheroo with the ladies and the hotels was technically within the rules and also how many players they have out on loan but it’s all allowed and as I wrote, all good unless they really underperform.
The selling to the same owners trick really is dodgy and should be looked into.
The rest of it though is a bit of a gamble. Manchester United took the same gamble and are paying for it now by not qualifying for Europe and still having to pay eg Marcus Rashford's wages even while he's on loan elsewhere.
The club he's loaned to is only paying a proportion of his wages. And he has no reason to sign a new contract on a transfer at a lower wage until the contract runs out, by which point he can then go on a free transfer.
It was looked into and dint break any rules sadly. They were even careful to make sure the prices were at a level they could claim a fair market value so they couldn’t get penalised for that.
Ben Habibs new party launched this morning - Advance UK, 1000 initial members apparently. However Rupert Lowe is not joining him, he will remain an indy and is launching an initiative called Restore UK which is not a party but he says an attempt at collaborative efforts etc etc. Reform splitters have split
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
Yes because it is not as if the banking system is deeply integrated into the wider economy. Obviously wages would be paid as normal and trade payments and receipts continue without banks. Or would they?
The trouble with simplistic ‘rescue X and let Y die’ solutions is the whole system is interlocked in unknown and probably unknowable ways.
The fear of systemic risk argument looks much weaker after covid. The government has the power to just do things.
But that's the point. The government did 'do things'. In both cases (GFC and Covid) they chose to do things to avoid a collapse (financial system, NHS, economy) rather than allow it and do things to try and mitigate its impact.
The reason for this is the consequences of the latter course were potentially catastrophic and impossible to model with any semblance of confidence. It would have been an unconscionable risk to take. They had no realistic alternative. Lab and Con alike, they did their duty.
It was impossible to model the effects of declaring war on Germany in 1939, so using that logic it was an unconscionable risk not to continue the policy of appeasement.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I suspect they looked at that, had a think about how much was involved in guaranteeing 100% of customer deposits when it actually had to be done, and decided that the course they took, while immoral and terrible, was less immoral and terrible than all the others. The knock on effects of all banks and deposit takers going under at the same time are not really possible to calculate.
The heart of the matter is elsewhere. Deposit takers were then and still are under massive government regulation. That regulation, as well as the banks themselves, failed to manage risk properly.
Once you move away from the Victorian age 'caveat emptor' then government has no choice but to take responsibility.
Nonsense, depositors are made senior creditors, subordinating all bondholders, employees and HMRC. The government provides liquidity while bank assets are sold to pay the state back for the immediate liquidity to ensure depositors are protected.
I think the calculation was, shit these two big Scottish banks are about to go under, the PM and Chancellor are Scottish and this is going to be hugely embarrassing for them so bail one out and force Lloyds down the aisle with HBOS.
That's almost certainly true for the last bit. As a then Lloyds shareholder, I've never forgiven Brown for strong arming that merger.
Lloyds would otherwise have been excellently situated coming out of the crash.
An interesting piece in The Guardian - Britain is sick. Massive inequality and chronic poverty combined with front line service cuts means an NHS under siege and incurring enormous costs from people made ill by previous cuts.
I'll keep making this point until the hard of thinking (hello Labour!!!) get it - cuts without reform cost more money than you save.
We're going to need to spend more now on actual frontline healthcare to save a lot more in the long term and that means making savings on the stuff we are wasting money on. Cutting sickness welfare is not the answer, making people healthier is.
Indeed. So much of Cameron and Osborne's programme of savings and long-term prudence turned out to be anything but that. Avoiding productive long-term investments, like the current governments crazy decision to scrap most of their green growth plan, can have parallel effects in the economic sphere.
The problem comes when trying to get people to acknowledge that there is a limit to spending. We have plenty of MPs who quite simply don’t believe that you can’t just stick it on the national credit card
Indeed, but, conversely, this can also just as easily become a fetishisation of cuts in themselves, and as an end in themselves.
Cameron and Osborne shouted this narrative almost every day, and yet they left the country in an even worse condition than when they started.
The problem they had was a structural deficit.
The response was *reduce the rate of increase of government spending* to above inflation, but below the rate of increase in GDP. Spending was never actually cut, overall.
So the key question is where do you cut, and where do you borrow or spend. Cameron and Osbourne seem to have got the calculus badly wrong, and all the bills are coming in now.
Neither unlimited spending or a Caneroonist narrativeil of cuts are going to get is out of this, I would say.
Invent a time machine and tell people to vote Tory in 1997?
For an even bigger financial bubble and crash, yes.
How? Ken Clarke would have kept control of interest rates and would have raised taxes during the 97-01 term. The bubble was all on Brown and Blair.
The MBS and derivatives bubble (and subsequent crash and credit crunch) would have happened anyway assuming no change in America. The key question therefore is, would the City under the Tories have been more or less likely to become a feckless Wall St tribute act?
My answer to this is certainly not less likely and most probably more. Yes, I know there was a speech by Peter Lilley. But that was an outlier and against the grain. In the years preceding the crash the Tory message was for lighter regulation because "those guys know what they're doing".
None of this is to excuse Brown btw. He got enamoured of the City (or rather its tax revenues) and took his eye off the ball. He dealt with the crisis brilliantly as PM but as Chancellor was culpable for our extreme vulnerability to it.
Under the Tories no bank was allowed to operate at 70:1 leverage after Barings went bankrupt. That was all on Labour and that's what created the crash in the UK. In retrospect the government should have let RBS and HBOS go bankrupt and only guaranteed 100% of customer deposits. Bailing out the financial services industry and socialising their losses set a terrible precedent and we're still paying for it today.
Northern Rock would of course have had to go bankrupt too on that basis.
The Bush administration of course let Lehmans go bankrupt with no bailout by contrast
Also fine. Bailing out the banks was a shit idea, the government should have, on day one just guaranteed 100% of customer deposits and then let the banks themselves go under then let the assets get sold off piecemeal. Let the shareholders and bondholders take the hit.
I would frame it as "let the market clear". The big jump in government debt was the price of failing to do that.
Yes because it is not as if the banking system is deeply integrated into the wider economy. Obviously wages would be paid as normal and trade payments and receipts continue without banks. Or would they?
The trouble with simplistic ‘rescue X and let Y die’ solutions is the whole system is interlocked in unknown and probably unknowable ways.
The fear of systemic risk argument looks much weaker after covid. The government has the power to just do things.
But that's the point. The government did 'do things'. In both cases (GFC and Covid) they chose to do things to avoid a collapse (financial system, NHS, economy) rather than allow it and do things to try and mitigate its impact.
The reason for this is the consequences of the latter course were potentially catastrophic and impossible to model with any semblance of confidence. It would have been an unconscionable risk to take. They had no realistic alternative. Lab and Con alike, they did their duty.
It was impossible to model the effects of declaring war on Germany in 1939, so using that logic it was an unconscionable risk not to continue the policy of appeasement.
I'm not sure kinabalu would disagree with that assessment.
Ben Habibs new party launched this morning - Advance UK, 1000 initial members apparently. However Rupert Lowe is not joining him, he will remain an indy and is launching an initiative called Restore UK which is not a party but he says an attempt at collaborative efforts etc etc. Reform splitters have split
Another one, (FFS)?
I want someone to launch the Re: Actionary Party.
The one I want to see is Retreat UK.
We won't achieve Dutch levels of fragmentation until we get incomprehensible names like L25 or Article 10.
In the last 2 days Chelsea have spent another £110m on two players. How are they staying within all these financial fair play rules?
They play the financial game in a way that will work for them as long as they keep qualifying for European football.
They sold their women’s team and hotels to other companies which were owned by the same owners as Chelsea so a huge gain on their books for the football club and no real change to the owners.
They sign players on usually 7 year contracts so that the fees are amortised over a longer peiod. Very good from a pure accounting ploy but dangerous if you get a player banned for doping or falls out and refuses to move as you have to keep paying them for 7 years.
They also have a huge stable of young players out on loan where these players just have to be bought for a few million here or there and they add up to pure profit.
It’s very messed up how their switcheroo with the ladies and the hotels was technically within the rules and also how many players they have out on loan but it’s all allowed and as I wrote, all good unless they really underperform.
I didn't think you could do the 7 year trick accounting trick anymore?
They sell an outbuilding to themselves for a gazillion pounds.
Comments
Agree, Western Australia looks a good bet.
The idea is you tell it there is a particular task you want solving. It plans it, then you say ok off you go. Depending on the task, minutes or hours later, having made all changes across code, help desk tickets, documentation, it basically returns finished.....Now you can try and look through all the things it has done but it quickly becomes incredibly difficult to track everything that has been altered as it goes through multiple rounds of adjusting things.
What could possibly go wrong....
While what you suggest was absolutely a risk, it might still have left us in a better state than we are now.
Something along the lines of the Asian financial crisis of the late 90s is also a possibility. And it would have put in place a far healthier set of incentives - and a far better public appreciation of the consequences of financial risk - than what we now have.
He wants your money, honey.
Adam Curtis, in discussion with Russell Brand about "Hypernormalisation". For those who cannot stand Russell Brand, here is a video with Brand edited out. https://www.youtube.com/watch?v=MIHC4NNScEI&t=1550s
This is why Starmer should not be Prime Minister. Without an inner core he cannot cope with the chaos of the world. He does not have the qualities necessary for the job.
“One thing that we’ve heard quite strongly is where things have got a name or are given a title that doesn’t actually speak to what it is. I think people actually don’t even understand the term ‘bill’, let alone all the myriad of different versions of that. We all get emails every day about a Ten-Minute Rule Bill. What is a Ten-Minute Rule Bill? The public don’t know that… It’s a bill that’s not actually a bill. It’s not really going anywhere – it’s a title. Or the way that we call things divisions and not just votes. Do people understand what they actually mean?”
https://www.politicshome.com/news/article/house-commons-leader-lucy-powell-parliament-modernisation-language-bill-division
I think the only person confused might be Lucy.
The heart of the matter is elsewhere. Deposit takers were then and still are under massive government regulation. That regulation, as well as the banks themselves, failed to manage risk properly.
Once you move away from the Victorian age 'caveat emptor' then government has no choice but to take responsibility.
Had all banks and building societies in trouble been allowed to go bust with no bailout though then yes we really would have had a second Great Depression and mass unemployment
"The team were dealing with a live situation but with hindsight we should have pulled the stream during the performance. We regret this did not happen."
Funny, he has been ranting like this at other festivals across Europe and a long history of it. Who would have thought he would also do it as Glastonbury. It will be good for his gig sales though as all publicity is good publicity.
The fact is that the knock on effects in the economy will affect everyone.
https://x.com/RonFilipkowski/status/1939345511355687035
The percentage of GDP = debt to GDP, so if the percentage is falling, then the debt to GDP is falling. As we entered Covid, the percentage was going down in the immediately preceding years.
It is possible to have a deficit and falling debt to GDP. If your deficit is less than inflation and growth combined then debt to GDP will fall.
Growth plus inflation ought to give a fairly healthy window of opportunity for lowering debt to GDP even without a budget surplus, which is preferred.
In 2002 we had an actual surplus, great.
In 2019/20 we had a deficit, not great, but it was small enough that debt to GDP was falling at least. Good but not great.
In 2007/08 we had a deficit so big that debt to GDP was rising, even after inflation and growth, even before the crisis hit. Terrible.
I think the calculation was, shit these two big Scottish banks are about to go under, the PM and Chancellor are Scottish and this is going to be hugely embarrassing for them so bail one out and force Lloyds down the aisle with HBOS.
Bad businesses fail and should be allowed to fail. Lehman's did a bad job and paid the price. Northern Rock should have paid the price too.
Deposit protection schemes exist, they should have been implemented for Northern Rock's customers and any other failed business.
The bigger problem is not that the crisis happened, crises happen. Crises should be planned for.
The bigger problem is how horrifically exposed we were to the crisis. When the crisis hit, we already had rising debt to GDP, our situation was that bad even pre-crisis which meant we were vulnerable to any crisis tipping us over the edge as we had nowhere to go but disaster when the next, inevitable, crisis came.
It is the DOGE thing writ small. They need to change procedures, not randomly sack people or change names while leaving the underlying processes in place.
The Reform UK Notts CC Council Leader seems to be trying to reduce public scrutiny:
1 - He is restricting the ability of Opposition Councillors to ask questions in public meetings. In the Constitution they get a submitted question, and a supplementary.
2 - This is important amongst other things because, as we remarked on Election night, Notts has a sharp NNW/SSE divide between RefUK and everyone else. I'm at the the turquoise end, obviously
He could change it by making a proposal for amendment under normal procedure and rules, making his argument and winning the vote in full council, but he hasn't. He should know this, as he has a staff of senior officers to advise him.
One to watch.
Report: https://westbridgfordwire.com/fears-some-nottinghamshire-county-council-meetings-could-become-undemocratic/
Anything not protected and not secure faces a haircut at the relevant amount.
All this process is already written into law and can be played out under administration. It happened with Lehman's who were still operating under administration (with a skeletal, very small crew) nearly a decade after going into administration and could have been done with Northern Rock.
The problem is jumping onto the tracks to try to stop the train.
Not sure what has happened to that link but in 2010 Osborne inherited a current account deficit of 7.29% of GDP. This fell every year until in 2019 they were in surplus by a tiny margin. Of course, we then had a change of government and Covid but the Coalition/Cameron government was extremely successful in bringing our books back into balance.
@AaronBastani
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22h
I don't think it's really clicked for much of political media that reputable pollsters have Labour third in Scotland AND third in Wales.
After next May Starmer will get the boot faster than you can say 'release the sausages'.
https://x.com/AaronBastani/status/1939315865314533860
https://bbc.co.uk/news/live/c74ww988gx1t#player
I am fed up with the prominence of the 'Bereaved families' in the proceedings. Yes they suffered loss. Yes it was horrific, yes mistakes were made but this isn't a coroner's inquest for your granny.
But the enquiry should not be about that - we need to plan ahead, stop things happening again. The bereaved are set on persuing blame, and every witness is coming to the stand to defend their actions. We needed a truth and reconciliation not a witch hunt.
And we should be examining the rest of the world to see what worked best (a far better track and trace, early wearing of face masks and a better compliant population as in SE Asia.)
Brown took us into a deficit even before the crisis hit, which then blew up (inevitably) when the crisis (inevitably) hit.
The coalition cut the deficit.
The deficit was small enough before the next crisis (inevitably) hit that debt-to-GDP was falling instead of rising, so the next crisis despite being a once-in-a-century pandemic hurt us less than the prior one, as we were better prepared for it.
When you save you are deferring consumption, by sending the fruits of your labor to someone else who is promising to deliver you the fruits of his labor in the future. All a bank is is a very thin sliver of equity between those two people.
And if that guy is unable to deliver the fruits of his labor in the future, then it is said saver who is on the hook.
When assets get mispriced, you need to allow the deck to be reshuffled and for people who made bad bets to pay the price (and I include making deposits in a risky bank as a bad bet).
I can tell them - the powers that be thought that hospitals were going to be over run. Job done, can I have my millions please?
FFS
Advance UK - into the brick wall?
https://en.wikipedia.org/wiki/William_Paterson_(banker)
However Rupert Lowe is not joining him, he will remain an indy and is launching an initiative called Restore UK which is not a party but he says an attempt at collaborative efforts etc etc.
Reform splitters have split
Anyone who has exceeded the limits, is acting unsafely, and should be aware of that.
Anyone within the limits, is acting safely.
https://x.com/AvantiWestCoast/status/1939591404793082162
They didn't try to "save" their banks and allowed them to fail, implementing the deposit protection schemes.
Those who were protected, got their protections, up to pre-existing limits.
Those who were not, faced a haircut, as they should.
Creditors faced a haircut, as they should.
The taxpayer did not get an open-ended obligation.
They sold their women’s team and hotels to other companies which were owned by the same owners as Chelsea so a huge gain on their books for the football club and no real change to the owners.
They sign players on usually 7 year contracts so that the fees are amortised over a longer peiod. Very good from a pure accounting ploy but dangerous if you get a player banned for doping or falls out and refuses to move as you have to keep paying them for 7 years.
They also have a huge stable of young players out on loan where these players just have to be bought for a few million here or there and they add up to pure profit.
It’s very messed up how their switcheroo with the ladies and the hotels was technically within the rules and also how many players they have out on loan but it’s all allowed and as I wrote, all good unless they really underperform.
The reason for this is the consequences of the latter course were potentially catastrophic and impossible to model with any semblance of confidence. It would have been an unconscionable risk to take. They had no realistic alternative. Lab and Con alike, they did their duty.
The graph helpfully pasted earlier shows a gentle, barely discernible rise under Labour and a far steeper one under Cameron/Osborne.
I want someone to launch the Re: Actionary Party.
The rest of it though is a bit of a gamble. Manchester United took the same gamble and are paying for it now by not qualifying for Europe and still having to pay eg Marcus Rashford's wages even while he's on loan elsewhere.
The club he's loaned to is only paying a proportion of his wages. And he has no reason to sign a new contract on a transfer at a lower wage until the contract runs out, by which point he can then go on a free transfer.
The graph shows immediately prior to 2008 there was a rise under Labour, which then became an even steeper rise once the crisis hit.
The graph shows immediately prior to 2020 there as a decline under the Tories, which then became a shallower rise once the crisis hit.
Comparing pre-crisis with post-crisis is absurd.
Anyway, i cant see Advance troubling the pollsters. They might get to the 1 to 2% Galloway/Workers got to last year at peak and that UKIP were getting before Brexit Party ate the remaining anti EU vote and destroyed them.
His one 'Trump card' (lol) might be Musk who is in discussion with him
As a then Lloyds shareholder, I've never forgiven Brown for strong arming that merger.
Lloyds would otherwise have been excellently situated coming out of the crash.
https://www.bbc.co.uk/news/articles/c5y7dpwle4yo.amp
And a WTF one:
"Woman let girl under 10 drive car through village"
https://www.bbc.co.uk/news/articles/cyvjjy5j35zo
And then she put it on social media !!!