[Stuart]

Originally Posted by mertle

Ignitionnet I dont mind people getting rich but the have duty to provide jobs this where we seen big imbalances all over this country. Jobs have been cut not because not being affordable but to maximise greed. There needs to better incentives to make private sector create the jobs the country needs.

The trouble there is that there are a few companies (Tesco, BT, HSBC etc) who have a tendancy to threaten the government if the government does something they don't like. Fairly certain that forcing them to employ more staff would be one of those things.

There is also not enough manufacturing industry we got imbalance to service industry too. Lots of consumer led industry which relies on people create jobs to spend for goods/food etc.

Another problem is that the government (in the 80s) encouraged companies to move their manufacturing operations abroad, apparently meaning for the UK to rely on service industries to finance our economy.

Then, the Government in the 90s encouraged outsourcing of a lot of service industries. Note: I don't think any government overtly encouraged anyone to outsource, but the Governments of Margaret Thatcher and John Major make it a lot easier to outsource manufacturing, and the government of Tony Blair apparently made a lot of changes to the law to make it easier to outsource services.

The problem is this not just labour fault its been every govenent ignored the warnings. Every government stuck there head in the sand hoping it would go away passing the buck hoping it would not blow up on there watch.

Yes there all to blame for the fiasco in housing market believing a false economy that it would boom and boom without the consequences of the future.

The problem is that successive governments did just use the house prices to tell people how well the economy was doing. All the time they were doing this, there was no will to reduce prices (it would have made the economy look like it failed).

Even now, I don't think any government could do anything to massively reduce the price. Certainly not if it wants to survive until the next election. They've spent so long telling people that the value of their house is a good indicator of how wealthy are that any attempt to reduce that value (even by 10%) would be enough to pretty much guarantee someone launching a no-confidence vote.

Its not rocket science that if your housing is too expensive to competitive market then it has knock ons. That is companies has to push prices up as they have to give sensible wages even cut staff to pay bigger wages. Then have less chances to compete against rising countries on the up where labour cost much lower due to living in shacks. Brown was an idiot to suggest it but analysists, papers and governments before and since ignored the problems that out of control housing market would create. Everyone was guilty.

Add to that the cost of Land. All those workers are going to need somewhere to work, and the house prices are driving Land prices up as well.