It has become commonplace to moan about the fact that Ed Miliband and Labour have not defended their record from 1997 to 2010 becomes too borrowing, the deficit and banks. I am one of those who has, on occasion, despaired. But, what could Ed Miliband have said? I am not, of course, the leader of the Labour Party, and never will be as I am not even a member, but this would have been my response.
_____________________
“Let me talk about Labour's spending record between 1997 and 2010.
I know what people say. They say we borrowed too much. They say we spent too much. They say we left the country in a mess. And I have to tell you, I disagree.
Let's look at some basic facts. In 11 years from 1997 to 2008 a Labour government borrowed £190 billion. Now I know that sounds a lot. But just to put it in context, from 2010 to 2015 the Coalition £570 billion. That is exactly three times as much.
Now I admit, we also borrowed in 2009 and 2010. A total in those two years of £253 billion. But let me stress, that in thirteen years we borrowed less than the Coalition did in five, and by some considerable way. So when criticism is handed out for borrowing, it's not Labour who should be picking up the blame.
In fact I would say it's exactly the opposite. You see, when we borrowed between 1997 and 2008 we did so for good reason.
We borrowed to build the hospitals that eighteen years of Tory rule had denied us.
And to build schools.
And to give the armed forces the equipment they needed.
We invested in the NHS so that waiting lists just became a bad memory.
And we made sure we gave everyone a better chance in life, starting with Sure Start, and helping sixth formers get the education they needed when they couldn't otherwise afford, whilst more students than ever before went to university.
We delivered with that borrowing, time after time after time. Which is why I gu8ess the Tories said they'd copy our spending plans, pound for pound as recently as 2007, just before the crash.
And it's why some pretty wise people, like pension funds and insurance companies queued up to buy the debt we sold, knowing it provided security for their own customers who relied on their judgement.
It's also I guess why we were re-elected three times. You know, it worked, and people liked it.
But there was, I admit, one thing we did not spend enough on. We did not spend enough regulating the banks.
Like other governments around the world we accepted the assurances of major High Street banks — whose names you all know — that they could be trusted to act responsibly if we did not regulate their every move.
We were wrong. They were not to be trusted. And here, and in the USA in particular, but with knock on effects throughout Europe, they lent too much, for too long to people who they should have known could never repay them. And they believed that property values would go up forever, which is why Northern Rock lent 125% of a property's value before the crash of 2008.
They were wrong. They failed us as a government, just as they failed the people and government of the USA, and Germany, France, Ireland, Spain and so many other countries.
The banks, and those who ran them, could not be trusted. They were exploiting their power for their own gain and I have said sorry before, and I will say it again, that we did not realise that. Behind all the smokescreens of public relations, and behind all the claims that the Conservatives made about the need for ever lighter regulation — as they did in the years running up to the crash — our banks were deeply rotten.
Of course I regret the fact that we did not realise that. It's why we have said you can never trust the Conservatives — who get so much money from their friends in the City — to regulate the economy ever again. No one, surely, should want the same thing to happen again, but with their approach that is likely.
And then the crash came. It was quick, it was brutal, it caused panic in the financial markets as the lies so many bankers had made began to unravel, and through it all I can say with honesty and pride that the one absolute dependable organisation in the global crisis that developed was the Labour government.
When the Royal Bank of Scotland admitted to Alistair Darling one Friday night in October 2008 that it could not re-open on the following Monday morning because it had, quite literally, run out of money he was the man with the level head who made sure that the crisis was managed. I doubt if there were very few other people who could have done that. The nation owes him a debt of gratitude.
Without his cool thinking and calm composure as he guided bankers and civil servants to a solution — which was nationalisation — then on that Monday morning maybe one in five people in the UK would have lost all they had in that bank.
Worse, they could have paid for nothing. Their children could have been without food that night, and certainly by the end of the week Alistair had not acted.
And it was not just individuals. Up and down the country employers could not have paid wages.
People would have seen their savings just disappear.
And once one bank failed others would have toppled one after the other as they're all so closely related to each other.
Labour saved the day. Let me say that again. Because we believed in the power of the state to solve problems, which neither the Conservatives or LibDems do, Labour saved the day.
And we kept saving the day. Gordon Brown led the world on the path to recovery, best symbolised by the world's leaders meeting in London in April 2009 to start tackling the crisis that faced them all.
And they agreed to do what we had done — which was to tackle the problem by making sure that people — ordinary people — did not suffer because of the problems bankers had created.
So although we faced a shortfall in tax receipts because suddenly the banks were no longer paying and all around businesses were failing and people were being made unemployed we decided to do the only responsible thing that a government can do in that situation, which is to spend.
And we spent wisely. We invested more than £50 billion in the UK economy and in long term projects in the immediate aftermath of the crash. This was not wasted money. It was money we spent to make sure people were still in work, off benefits, and with money in their pockets so that they could still spend with the UK's private businesses and so prevent a recession spreading.
We cut VAT for the same reason — we wanted to support the UK's businesses when times were tough to make sure they would survive.
And because, as is always the case in a crisis like this, people immediately stopped some of their spending and business stopped investing there was a flood of savings available which people wanted to lend to us because they'd lost all confidence in the banks. We used that money responsibly to invest in the skills, the people, the businesses and the infrastructure of the UK to make sure that we recovered as fast as possible.
I maintain that was the right thing to do.
Not once, not ever, were we like Greece. We had gone into the crisis with low borrowing by European standards, with a strong currency, a pretty good tax collection system, and interest rates that never threatened recovery. We were always, strong and solvent. People queued up to lend us money, and we used it well.
I know that: the economy was already growing again in May 2010. I think Labour can and should be proud of that fact. We spent well to put the UK on a sound path to a rapid recovery.
So in that case let me deal with something that will otherwise inevitable come up. Why did
Liam Byrne leave that note for his successor in 2010 in which he joked “there is no more money”. I will be honest with you. He was wrong. But I should add, he also knew he was wrong. That was the whole point. It was a joke about the austerity plans the George Osborne and his team were bringing with them to the Treasury.
The simple fact was that we had proved that there was a viable path to balancing the books in 2010. That was because when we left office our economy was recovering from the crash in 2008. There was growth. The deficit was already falling. We had already put in place all the measures needed to ensure the growth would have continued and that the deficit would be steadily reduced.
Liam Byrne knew that. But the whole Labour team at that time also knew that any government, whether Labour, Coalition or Conservative would have needed to borrow throughout the last Parliament. The joke was that the Conservatives had pretended that was not the case. As it turns out, Liam was right. And as Liam knew then, and I can assure you now, we would have been a much better place in 2015 if we had had a Labour government for the last five years.
Why's that? Because we would not have imposed the vicious austerity that the Coalition has imposed.
Make no mistake, there would have been cuts, and there will still be cuts. Every government has in the end to live within its means.
But we would not have victimised the poorest.
And we would not have slashed investment to almost nothing as this government did, which means we have had the slowest economic recovery from a recession in the UK's history.
All of that was unnecessary. With compassion, with care, and with the focus on building for the long term that Labour has we would have borrowed, undoubtedly, but to build a future for us all.
And we would have driven re-regulation of the banks harder than this government has.
And we would have demanded a bigger contribution from them because if anyone has recovered well from this crisis it has been the banks, and that's unjust, and yet the Tories have rewarded then was massive tax cuts as companies and with massive tax cuts as high earning individuals. I can promise you, Labour would not have done that.
So what will we do now?
Of course we still face a deficit, and as I have said, a government cannot spend more on its current spending than it enjoys as income forever. But it is important to say that Margaret Thatcher was always wrong to suggest that the national economy should be run as her father ran his shop. There's a big difference between the two. Corner shops can't print money and countries like the UK — which did not go into the Euro because Labour saved it from that fate — can.
Labour started printing money to make good the shortage of bank lending in the economy in 2009. It had to do that because, and this may surprise you, almost all money is created by banks lending it. And it is destroyed when people repay their loans. Of course that doesn't apply to the notes and coins in your pocket — but they're just 3% of all money. The rest is created by banks. And because the banks did not create enough money in 2009 because the crisis was then unfolding and they stopped lending we had to print it instead. The process is called quantitative easing but that's just technical blurb. It's simply the government making money out of thin air.
From 2009 to 2012 this was done to make sure the banks and financial markets stayed afloat. In the end that was a mistake. The result was a stock market boom, excessive speculation and a house price rise in the south east of England as bankers' bonuses carried on unabated.
But what we did not get was what the doom sayers said would happen. We did not get inflation. And we did not go bust like Greece. In fact we got record low interest rates — the government can borrow at interest rates that are, when inflation is taken into account, negative right now. And we got zero inflation.
So what is obvious now is that first of all there as too many savings in the economy — or interest rates would not be so low. And, second, that means there is not enough spending in the economy. That is precisely, in two sentences the economic problem this country faces.
The result of that situation is that we still have too many people unemployed, and we have far, far too many people in insecure low paid jobs that pay them nothing like their true worth.
Some people may like a lot of insecure low paid jobs in the UK. David Cameron seems to be one. But I don't. So this is what I'll do.
Yes, I will aim to balance our current spending with our current income over the life of the next parliament — so long as ordinary people are not hurt in the process.
But there is no way I am going to include our investment spending in that equation as David Cameron does.
I'm told that there was a time when people would not buy things unless they could pay in cash, upfront. That condemned people to never owning their own homes.
And I'm told there are still some people — let's call them the Chipping Norton set — who have so much money they've never had to borrow money to buy anything.
But for the rest of us — government's included - borrowing to pay for investments in homes, energy systems, transport infrastructure and schools and hospitals makes sense.
We borrow if we know we can repay the loans. And right now people are almost paying the UK government to lend it money. Borrowing has never been so cheap. If we borrowed to pay for all we will invest in we will not be saddling ourselves with unaffordable debt in the future. That's because what we will invest in pay for themselves from growth, from rents and from savings.
But we can also go further. We could print some money too, just as we did for banks from 2009 to 2012, to give the economy the boost it needs to really get us going again. And I am proposing that we do just that — to the tune of maybe £50 billion a year until wages rise, tax revenues grow (as they will, which pays down the deficit) and full employment returns, when this policy would very definitely stop.
Put this together and we do many things.
We invest to pay down the deficit.
We increase wages, and the resulting increased tax payments pay down the deficit.
The money we will spend with the private sector will boost profits, and so their extra tax will help pay down the deficit.
More people will work and so benefits will reduce, and that will pay down the deficit.
And we will build for our futures — including clean energy - which reduces our imports and helps pay down the trade deficit.
And whilst doing all this we will provide a safe and secure place for the savings people want to invest with us.
If we do it right we might also increase interest rates as a result — and I know quite a lot of people will be pleased about that.
But we won't set house prices on an upward path — because we will be building 200,000 news homes a year by 2020.
This is a new economic policy that builds on all the lessons we have learned. It is unapologetically a policy intended to liberate the power the government has to build growth and prosperity in partnership with the private sector.
It's a policy that puts people at the heart of the economy, and not bankers.
But it's a policy that recognises that we need to balance our books, and that growth can do that, including growth for the businesses of this country.
This is a vision.
It says if we could bail out the banks we can use the same techniques to rebuild our economy.
It's a vision that says the sixth richest nation on earth does not need to penalise the poor to balance its books.
It's a vision that says we believe that Britain can and should build its own success.
It's a vision that says government is at the heart of this process, just as it was at the heart of saving the UK from economic meltdown in October 2008.
It's a vision that can work.
And that's why you should vote for it.”
______________________________________________________
I'll never deliver that speech.
But I thought I'd share it.
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The Royal Bank of Scotland ran out of money did it? How could that happen if it can just create money “out of thin air”?
Because it can only do that when making loans to others
Not to itself
Only the government can do it making loans to itself
Mind you, Richard, Barclays got close to doing just that such are the possibilities of playing ‘games’ with money:
“Barclays may face an investigation over allegations that it lent Qatar money to invest in itself during the financial crisis, so avoiding a government bail-out.”
See:http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/9841197/Barclays-investigated-over-claims-it-lent-Qatar-money-to-invest-in-itself.html
The corruption is limitless.
You still peddling this inaccurate story that fails to acknowledge the structural deficit that was inherited? To continue to then blame the Coalition for the debt incurred whilst at the same time, blaming them for ‘austerity’ is simply laughable.
Do you understand anything about economics?
I have explained my view
And the facts
And you have not engaged with them
The ‘Structural Deficit’…….Oh dear, oh dear……………..
Begging your pardon ALF, the only thing that I see is ‘structural ignorance’ – like yours and too many others who’ve bought into the Coalition lies and misinformation. Wait up – I feel a song coming on!!
“When you cast your eyes upon the skylines
Of this once proud nation
Can you sense the fear and the hatred
Growing in the hearts of its population
And our youth, oh youth, are being seduced
By the greedy hands of politics and half truths”
Chorus:
“The beaten generation, the beaten generation
Reared on a diet of prejudice and mis-information
The beaten generation, the beaten generation
Open your eyes, open your imagination.”
THE THE, MINDBOMB, 1989
we have had ‘structural deficits’ (definitions vary but, in essence, it’s spending more than taxes raised) for most of the last 300 years, including times of growth. It depends when you take the figure from. After 2007/8 tax revenues fell-it wasn’t reckless spending. Then there was the bank bailout. The Coalition did inherit a deficit, the issue is, ‘did they tackle it in the best way?’
Maybe you would like to learn some economics. I’ve added a lesson from an economist with a Noble prize .
http://www.theguardian.com/business/ng-interactive/2015/apr/29/the-austerity-delusion
Interesting that you have chosen to ignore the ‘Whole of Government accounts’ 2010-14 that, as Richard recently pointed out, highlights that the deficit for the whole of Government has been increased from £1,200bn to over £1,800bn in four years (and rising).
The fiscal legerdemain at play here means that the appearance of deficit reduction has been artificially created by sliding pecuniary liability sideways off the central balance sheets onto Government departments (such as the NHS and Local Authorities, many of whom are now staring into the financial abyss as a result) and agencies who are primarily or wholly dependent on State finance.
It should of course be noted here that many of those bodies have statutory obligations to provide services but are also proscribed by law from increasing their income beyond the limitations placed on them by Central Government.
It is, I will grant you, a nifty trick. I am currently considering shifting 25% of my mortgage liability to my 2 year old, which should make my own balance sheets look much more healthy.
Still not entirely sure where he’s going to find the money to pay his share, but,hey that’s his problem really…
Sorry above directed to AnotherLabourFool
Well noted and said
This is very interesting and I share your emphasis on the effects of austerity on the most vulnerable.My question is ‘Why do you think Ed Milliband and Labour have not made this speech?’
I personally believe that Labour does not make such a speech because (1) Labour do not want to be seen as defensive (weak), (2) they think that the explanations are probably beyond most voter’s understanding and they’d fail to make themselves understood and therefore are likely to be seen as untrustworthy and (3) they have lost confidence in the British public to know right from wrong.
There is a 4th option in that they too believe that deficits are wrong and markets should prevail in all areas of life and are just as stuck about what to do about this as much any other mainstream party in the UK, if not the West.
I agree Mark. If they came out with the Modern Money facts, i.e.:
1) A Sovereign Currency issuer cannot have a shortage of money
2) The only restricting factors are
a) Inflation
b) Resources
They wouldn’t be believed and the press would demolish them. However, I suspect that your 4th point is likely to be the sad truth.
It’s an excellent speech Richard. Maybe you should be out there delivering it.
Well said Richard, that was pretty impressive. If the polls are right, then I am concerned that David Cameron will get the first go at forming a Government. I though Milibands engraved stone made him look like a bit of a prat though.
Roll on Thursday!
Agree about the stone
Whoever thought that up should be job hunting
I think you might find the “Stone” idea was copied from Mr Salmond – granted, his stone did not resemble a gravestone.
me too Mike
I don’t understand this point you make about the coalition borrowing £570bn in 5 years but Labour borrowing only £190bn in 11 years. In fact, it support quite the opposite of what you seem to think it does.
Because as you admit, in 2009 and 2010 Labour borrowed £253bn. Do you think an incoming government was suddenly going to stop borrowing at this level, and suddenly go back to the £17bn/year 1997-2008 average, just overnight? Or even in two or three years? It was simply not possible.
The £17bn/year 1997-2008 average is of course flattered by the public finances having been in damn good shape when Labour took office in 1997. They had no need to go on a massive borrowing binge at that point. It was only when the crash came in 2008 that Labour realised that the massive increases in public spending in 1997-2008 were predicated on unsustainable projections of tax revenue. The result was then massive borrowing for the last 2 years of the Labour government and, unavoidably, whoever succeeded them.
Do you seriously not see that?
No, I do not see that at all
In fact, as we know, those projections have to be sustained as the need exists
The reality was it was revenues that collapsed
And as the speech notes, that can only be addressed when we rebuild the economy
We can do that
We cannot take the need away
But you will sacrifice people instead of doing what is needed to ensure need is met
I call that callous
Douglas
What you seem to be suggesting is that New Labour should not have invested in many public services that had been neglected by a very long Tory period in power. You come across as expecting New Labour to have saved money or printed it in order to deal with the crash of 2008 and deliberately ignore the needs of the people who use those services.
You take an unacceptable position.
No one expected the 2008 crisis – no-one (except a few ignored dissenting voices). Neo-lib economists said that markets were self correcting and did not need regulation and a crash was impossible. For a long time in the early 2000’s the financial sector kept supplying endless money – especially to fund the housing market. Both Tories and Labour bought into this as did many Western governments.
So why should New Labour – who believed what everyone else believed to be true – not invest in the services since it was not expecting a crash and the resultant loss of economic activity and their attended revenues?
You expect too much of any government who was in power in 2008.
Instead of bashing New Labour, why not think a bit more about where this crisis originated? It originated in America, and I’m still waiting for the President to apologise to the world for what his country’s financial system has done to millions of innocent working people.
Hi Richard,
I sympathise with your view of things. This is a speech I’d like many party leaders to make. Of course, it would be ignored and/or attacked by the mass media with smoke and mirrors and would not have any impact. The problem in the UK is our media as much as it is our democracy. Stability seems to be the be all and end all. Anything that might scare the markets is treated like this.
But could you debunk the ‘structural deficit’ point made above for me in simple terms? I am no expert. Just someone who’d like to understand his world a bit better.
Keep up the good work.
thx.
In simple terms the structural deficit is meant to be a persistent amount by which the government overspends, year in, year out.
The definition is naive. It assumes that all government spending can be accounted for on a cash basis, and that is wholly inappropriate with regard to investment expenditure. If the government is appropriately spending to generate growth, or to create future savings then it is entirely appropriate for it to overspend at a point in time because that overspending would then represent borrowing to invest. Any organisation, whether a company, and individual, charity or whatever, can quite reasonably borrowing that situation, and the government can too.
The definition also assumes a stable value for money: at the macroeconomic level this is, of course, asbsurd: the government can first of all control the value of money (within parameters) , and secondly is such a large borrower that to take changes in the value of money into account is appropriate. Therefore, any increase in debt that is consistent with the amount of inflation during the course of the year when multiplied by the stock of debt already outstanding does not, in my opinion, represent a part of the structural deficit.
These factors are not taken into account by the deficit fetishists.
Great speech and I wish Ed Miliband was delivering it, as well as making those key points in every interview. I’m still baffled about why he isn’t.
I’m no expert, but surely the point about RBS is that yes, they could have issued loans on that Monday morning. But they couldn’t fund their cash machines etc, which is why there may not have been food on tables.
Interesting point: they could certainly not have got cash
I am not sure they could have made loans: regulation would not have allowed it
Since when did regulations matter to the financial sector?
Sorry, that’s wrong
They do matter
Even if they spend a lot of time trying to get round them
All spot on. Could easily be a speech by Natalie/Nicola/Leanne — maybe send them a copy as well as to Ed, with a decent chance that one of them will make it?
Love that speech and like many others am so frustrated that these words in these measured tones have not been broadcast far & wide since campaign began (and topically since Labour went into opposition).
That they haven’t may well be related to the now named ‘Milistone’ (HT ‘Captaingrey’ Guardian reader/commentator). Unbelievably poor judgement. It will bite him on the rear, whichever way youlook at it. Whatever they are paying Axelrod, it’s too much. What a rubbish campaign. Ed strikes me as an absolutely genuine guy. The real millstone he is saddled with is the blairite, blue labour wing, who have far too much control of the agenda and whose predominance internally will certainly give me pause when I go to place my x on the ballot paper.
Keep up the fantastic work Richard. You are an oasis in the media desert.
Read Tim Gorton Ash in the Guardian today
His voting advice is wise
I’ve read the article -it makes some good points but I’m not sure that changing the phrase from ‘tactical’ to ‘strategic voting’ makes me feel any better about voting for a party I don’t want to vote for and he mistakenly conflates public and private debt which hardly helps the debate:
” Now, we do have to keep worrying about Britain’s high levels of public and private debt…”
Private debt yes!
personally, the voting system all but disenfranchises me.
Richard
You’ve excelled yourself and filled a huge void. I’d vote for you. But I’ll read Ash’s article as you suggest.
As usual the ‘anti’ commenters above are given an easy target by the speech using the language of houshold budget e.g. “borrowing”.
You do touch on money creation (well done there), but until progressives use the correct terminology consistently, I don’t see how any progressive party (or ficticious Ed) can make progress if they continue to feed the (right-wing friendly) myth that government’s are like households.
By doing so you have lost the argument before you have begun.
Sorry
But that’s just crass
I resoundingly reject that idea
Governments can and do borrow
If you’ve so far removed yourself from reality the other way you are no help to reform
Richard,
I know you understand, and moreover agree with, the MMT argument that government taxation is NOT undertaken to finance its spending.
However, taking your reply at face value, you seem less well informed on (or perhaps disagree with?) MMT’s take on government borrowing than I had assumed. Namely that government ‘borrowing’, like taxation, has NOTHING whatsoever to do with funding spending.
Instead the primary purpose of such ‘borrowing’ is to act as the mechanism by which the treasury and BoE co-operate to set the base rate. Government borrowing also acts as a risk-free source of savings to the private sector, including pension funds.
If you are genuinely unfamiliar with this aspect of MMT then please take a couple of minutes to watch this interview (9:22 mark) with one of the foremost exponents of Modern Monetary Theory, Professor Bill Mitchell…
http://ineteconomics.org/new-economic-thinking/bill-mitchell-demystifying-modern-monetary-theory
Richard, I hope you take the time to reconsider your view on borrowing, as what Bill and other MMTers describe is very much grounded in reality.
For 40 years neo-liberalism has crushed all on-comers by promoting the false premise that ‘government is broke’. That can only be reversed by an alternate framing.
MMT is that alternative. Without it, the progressive reforms we all seek will be forever out of reach.
Best Wishes
Stephen
PS In case you are wondering, the reason that there is a balance between spending = taxes + borrowing is that if the government did not ‘borrow’ at this level, this would otherwise create excess reserves in the banking system, and this would drive overnight interest rates down to zero….Yes, a bit technical, however the problem is that the optics of the relationship makes it LOOK like borrowing (as well as taxes) are the source of government income. Whereas in fact neither are.
I fully understand what MMT says
And I agree: spend comes first, recovery afterwards
But, as you note, that does not deny the reality of government borrowing
It does borrow even if not for the reasons conventionally given
You said I was wrong on that: I am not. Borrowing exists in MMT even if for quite different reasons to those conventionally supposed
Glad to hear you understand MMT (though even more mystified why you thought my previous comment was “crass”).
By the end of this week, one of two sets of neo-liberals will enter 10 Downing Street. Tweedle-dum vs Tweedle-dee. Both wedded to this austerity nonsense.
Debating them on their turf – namely using the language of “deficits”, “borrowing” etc. – only feeds peoples fears of ‘bankrupting the nation’ and ‘burdening our grandchildren’, and so has little chance of defeating them.
Far from being crass, that is a cogent, reasoned argument. One very much in line with Bill Mitchell’s thinking…
“We thus consider the progressive challenge is not to invent a new term for deficit, but…we can exploit the More Is Up metaphor by always relating the government deficit to its non-government manifestation — the rising net financial assets that a deficit provides.
So we should say:
The government deficit rose and generated higher levels of wealth for households and firms.”
http://e1.newcastle.edu.au/coffee/pubs/wp/2013/13-06.pdf
You said governments do not borrow
They do
The economic impact may be entirely different from other borrowing but it is borrowing
This is quite a masterpiece of a speech, all the important points are made and I imagine you wouldn’t have charged £300,000 for it! What have they come up with–the ‘Millistone’ !
So in fact only the central bank can created base money “out of thin air”. The RBS fiasco (not to mention the Coop bank’s embarrassment) shows the phrase is just a little silly when applied to commercial banks.
No it’s not: it’s emphatically true, as the BoE has confirmed
Well, I’ve read TG Ash and then looked at the Derbyshire Dales seat I live (and vote) in. In 2010, the Conservative majority was just under 14,000 votes, and then after that it’s the Lib Dems and then Labour. We have the very arrogant Patrick McLoughlin here and there’s a lot of cap doffing in rural Derbyshire to your social betters (lovely place to live though).
So if I was voting with my head, I would vote Lib Dem, right?
Answer – no way. Never in a million years. Sorry. No. The local Lib Dems are nice bunch – I know some of them personally – but I am not sure I want Clegg, Danny Alexander and dodgy expenses claimer and ex-Financial sector boy David Laws running the country again.
So I’m going Green, because Labour back TTIP, Trident and don’t believe in a courageous state.
In your case it looks like it makes no odds!
Much the same for me
Only electoral reform can sort that out. Roll on the day………….
It’s a great speech and even manages to address the Liam Byrne letter. The problem for labour though is not that it is impossible to defend their record in a long speech or article, but that it is incredibly difficult to do so in a two sentence soundbite, which is what they need to do to convince the majority of the public.
Very good points to make to the electorate. If this doesn’t convince them, nothing will.
You have done a fantastic job over the past fortnight championing the Labour Party through this blog. I hope they appreciate it.
I have not championed the Labour Party
I have championed those interested in acting on behalf of those in need of society from whichever party they come
Then how do they “run out”? What restricts them creating new money “out of thin air”? Why do bad debts then cause a bank to run out of money?
Don’t you think there might just be a teensy weensy bit more to it than the
Cr: current a/c
Dr: loan a/c
you have offered us before?
Yes, it’s called regulation
It’s how we stop them abusing trust
Next?
Well then, as an accountant you SHOULD have realised that your simple credit:debit entry (above) was so simplistic it was actually incorrect. That does NOT represent the commercial reality faced by banks. If you are struggling to complete the entries, I could help.
That is the entry made
Sometimes they are not permitted to make it
Are you saying you know better than the BoE?
Time and again you have proved you know very little here
Actually Richard the BoE did go further than that. The bit where the bank then needed to go and find the funds to support its lending. Frances Coppola has some fun one afternoon explaining at all on the Worstall blog.
Those other entries really are important. Come on Richard, you need to put them down in your post.
a) The BoE did got rather confused on that point, contradicting what it said itself
b) Frances Coppola is not always right
c) Worstall’s blog? You have to be kidding
You’re wasting my time again and you know what happens then
Whatever your detractors say, its clear you want what’s best for society and not just for the privileged few. stirring speech, its a shame you are not in a position where you could have a greater influence on policy
If only our politicians argued thus, I gave up waiting (46 years a regular voter) for Labour to. There is an alternative – Green – not a wasted vote – A statement.
Ed Miliband is a capable leader of the Labour party, you are an excellent Tax blogger.I think both of you are able (and I am not a Miliband basher though I prefer his brother). But don’t swap your Day jobs please. Don’t mean to be rude, but if it takes so long an article to make your case, then the case is probably not worth making.
And I wonder if you are competent at anything?
Have you never spent thirty minutes explaining something?
If not, quit the profession now
“Now I admit, we also borrowed in 2009 and 2010. A total in those two years of £253 billion. But let me stress, that in thirteen years we borrowed less than the Coalition did in five, and by some considerable way.”
To say this would either be underestimating the intelligence of the electorate or showing a misunderstanding of how deficits work and how slow they are to turn around.
I think we must differ
I just don’t see how a rapidly increasing debt was avoidable given the deficit in 2010. Debt would have dramatically increased in the subsequent years (as it did 2008-2010) whoever was in charge. I agree the burden of this hardship may have fallen on different people, but I don’t see that the coalition can be held responsible for rapidly increasing debt this parliament.
For balance I don’t think the coalition have made enough progress on the deficit, but even if it was zero in 2015 then the debt would still have been much higher at the end of the parliament.
I agree debt was inevitable
That’s what the ‘speech’ says
The stupidity was Osborne saying he would clear it
Yes – fair enough. Osbourne is made to look silly by his own bold predictions.