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Yes but if that simply results in more imports from China because its government currency rigs then the value of the pound drifts down over time which puts downward pressure on UK growth.
Come on, not all spending is on Chinese imports
No but it is a serious issue that needs addressing:-
https://cepr.org/voxeu/columns/china-worlds-sole-manufacturing-superpower-line-sketch-rise
Absolutely! paying money to people who don’t have a lot of money and they will spend it. That spending is, by definition, increasing GDP. Simple.
If you want it to be “fiscally neutral” then just tax rich people who will merely dip into savings and not cut spending (and therefore not cut GDP).
Indeed, because public servants pay income tax, NI, VAT etc. and the multiplier effect (eg. the tax that the restaurant/chefs/waiters pays if the teacher can now afford a dinner out) suggests that the tax rises required on the rich would be quite modest.
Paying public servants more is a really good way to increase growth!
The pension stuff IS important…. in that we do need to do better than we are at present. However, as you correctly observe, “just do more” of what we are already doing is not an answer…. indeed, it is pretty close to Einstein’s definition of insanity.
Thanks
Millionaires save most of their money (otherwise they wouldn’t be millionaires).
The less well-off spend most of their disposable income, stimulating the economy.
How much extra should we paying those in the public sector? One teachers’ union, the NASUWT, says teachers’ pay has lost up to a third in real terms since 2010. (Their calculation may be disputed since they use RPI which they argue is a better measure). But It is surely true that many workers pay has been severely eroded by inflation, wage freezes and austerity Yet “independent” pay bodies will recommend derisory increases.
Meanwhile, the BoE boss, on half a million, called for worker pay restraint and continues with high interest rates to maintain recessionary pressure. And any thought of price controls as a means of fighting inflation remains unthinkable.
From Laura Kuenssberg interview with Rachel Reeves:
Reeves: “What happens when you make unfunded commitments is the economy crashes”
Kuenssberg nods along
Watching stupid claims become common sense in real time
https://x.com/theNewsfox/status/1815003696779993200
Did furlough crash the economy?
Did renationalising banks?
Will any ‘journalist’ ever ask?
I have never understood the meanness of spirit that thinks it’s a good idea to stop other people from prospering. Is this not actually self-defeating?
No such claim was made.
Why not engage with what was said?
Marginal propensity to consume