George Osborne's £5bn gamble to stave off recession

[denphone]

http://www.guardian.co.uk/uk/2011/no...tumn-statement

An extra £5bn of capital investment, funded by spending cuts elsewhere, will form the centrepiece of an overall £30bn national infrastructure programme due to be announced by George Osborne on Tuesday as part of an attempt to prevent the country from sliding back into recession.

He is also expected to announce a deal designed to unlock £40bn of bank lending for small businesses in which the government will underwrite the lending.

Speaking on the BBC's Andrew Marr Show, Osborne admitted the OBR forecasts would be downgraded, saying: "This is an exceptionally difficult time. We have a slowing economy, a slowing world economy, we have this financial crisis brewing in Europe."

[chris9991]

What if we go on this spending spree and don't find anything else to cut? Are we just going to be saddled with obligations?

[mertle]

Originally Posted by chris9991

What if we go on this spending spree and don't find anything else to cut? Are we just going to be saddled with obligations?

what been planned we will be saddled whichever with TOLLS all over the shop. Talk about stealth taxing motorists.

This government fast going down the tubes. Its ran out steam and ideas just gone totally bonkers with policies idioligies and even harbouring confrontational to there pet hates.

Libs **** entrenched into backside they smell rotten and not got ounce bottle to bail leave the torries on there madness binge on there own.

People going to regret bigtime these got in power.

Your post has nothing to do with the topic, just one of your standard barely-literate anti-Coalition diatribes.

You have been complaining that nothing has been done to help small businesses or kick-start major Infrastructure projects - when something is done, you just whinge about generalities.

Claudia Schiffer could offer you oral gratification and you would complain about the colour of her lipstick.....

The government are using money saved from the spending cuts to fund this plan .Quite a lot of the cuts where needed and where a result of labours attempt to keep unemployment down by inventing more government jobs that where not needed .At least this way the jobs will be real jobs contributing to the tax reciepts of the treasury instead of jobs that only use the tax money and cost taxpayers extra money paying government funded pensions ,so on the face of it it is a good thing

[Sirius]

Originally Posted by Hugh

Claudia Schiffer could offer you oral gratification and you would complain about the colour of her lipstick.....

[mertle]

Originally Posted by Hugh

Your post has nothing to do with the topic, just one of your standard barely-literate anti-Coalition diatribes.

You have been complaining that nothing has been done to help small businesses or kick-start major Infrastructure projects - when something is done, you just whinge about generalities.

Claudia Schiffer could offer you oral gratification and you would complain about the colour of her lipstick.....

Sorry but your wrong if watched news its been ridiculed already by even experts. Crikey Even tory nick robinson not convinced.

The way forward is investment but not this way making roads with TOLLS which IS BEING PLANNED A14 for instance near Kettering. Thats what my hatred to the proposal we dont need more tolled roads.

By all means infrastructure is needed its also worry if this funding going to be nationwide or pet structured to mainly southern bias. That will hold fire until Know where there plans lie.

Many northern hubs need serious investment due to neglect and cronic heavy goods vericle use. Take A180 needed motorway third lane to at least immingham possible much further. New road to immingham dock south side for the impending superport upgrade. Which was initially granted but then got chucked by stupid government who saw lack forsight.

Now we heared one good news humber bridge tolls halved.

I am not clapping yet for theyre forsight

My reason is I would Like to know where money come from if its down to persecution of poor, elderly, disabled then its not right at all.

You might make stupid comment but think of those who suffered by these idiots. Then all sudden like theyve won the lotery they gone on mad spending spree. Totally uturning there plans I feel for those who suffered at there hands if they using that saved money then its blood money.

Where the 600m free schools money come from, 1bn for there cheap labour youth system which could effectively throw more out of work.

[Arthurgray50@blu]

There must be loads of Tory lovers listening to all this crap coming from Osborne.

The money that Osborne is giving away has come from money saved on people losing there jobs in budget cuts, which is a disgrace.

It is no good this money going towards rebuilding roads or education, the damage has already been done, it has been stated that there are more budget cuts coming.

Where has the money gone that we pay in road tax, why doesn't he reudce VAT, becuase he won't

The cuts are going to come from the welfare (again) OAP(again).

The government must invest industry, this country is in a total mess, caused by Cameron and Clegg and NOT by the previous government.

Ahhhhhhh.

So, in summary - rant, mumble, invective, diatribe, more invective, mangling of language, rant, mis-spellings, random punctuation, more ranting.....

Two minds, thinking as none - with your posts next to each other, there may be the possibility of your neurons sparking a synapse.....

Doubtful, though.

Originally Posted by Hugh

Ahhhhhhh.

So, in summary - rant, mumble, invective, diatribe, more invective, mangling of language, rant, mis-spellings, random punctuation, more ranting.....

Two minds, thinking as none - with your posts next to each other, there may be the possibility of your neurons sparking a synapse.....

Doubtful, though.

I've just spent 1/2 hr trying to compose a reply to both of them but couldn't work out what exactly it is they want so gave up .I could have sworn that in past threads both Arthur and Mertle expressed a wish for the government to invest and create jobs ,protect pensions and encourage banks to lend to small companies so i don't know about anyone else but they have me very confused

[Arthurgray50@blu]

Look at it this way, IF governments encourage banks to loan out money to small businesses, tell me which bank is prepared to lend money to a small business with no hope of getting there money back in the present climate.

When we had the last London Riots, way back when l had my own business, l went to a well know NW bank, and ask for a loan to cover me for three months, thats all l needed, do you know what they said - IF l had a house, they would put a mortage on it, BUT they said NO.

The government CANNOT invest in jobs, as there ins't any, what they have to do, is STOP giving contracts abroad, they give out stupid training schemes, which are a total waste of time, as l have been on them.

The only way that this country can get back on its feet is simple, the government have got to get the economy moving, stop interefeing in other countries problems, stop the cuts before they get to bad. And use tax payers money(as they do anyway) to get everything rolling and stop talking bull ****.

Originally Posted by Arthurgray50@blu

Look at it this way, IF governments encourage banks to loan out money to small businesses, tell me which bank is prepared to lend money to a small business with no hope of getting there money back in the present climate.
.

did you even read the article or did you just see the words "osborne" and "budget" and start ranting ?.
The government want to guarantee some loans to small companies so that the banks will lend them money for investment and stopping them closing down

When we had the last London Riots, way back when l had my own business, l went to a well know NW bank, and ask for a loan to cover me for three months, thats all l needed, do you know what they said - IF l had a house, they would put a mortage on it, BUT they said NO.

That's how it works Arthur ,if you have collateral then the banks may lend up to the value of that collateral if you don't then they won't

The government CANNOT invest in jobs, as there ins't any, what they have to do, is STOP giving contracts abroad, they give out stupid training schemes, which are a total waste of time, as l have been on them.

They aren't investing in jobs they are trying to create a enviroment where jobs will be created

The only way that this country can get back on its feet is simple, the government have got to get the economy moving, stop interefeing in other countries problems, stop the cuts before they get to bad. And use tax payers money(as they do anyway) to get everything rolling and stop talking bull ****.

That's what they are trying to do

[Ignitionnet]

We don't have any taxpayers' money to get everything rolling - Gordon increased state expenditure by 50% while the economy really only grew at 18%. Guess what that left? Yes, a great, big deficit!

Even during the boom periods when the financial services industry had almost doubled in size and taxes were absolutely pouring into the treasury, people were paying obscene amounts for housing which was his other 'growth' along with the other 2/3rds which was public spending he was still managing to outspend that boom.

Strangely enough when that boom stopped booming the tax receipts that were never enough to pay for his spending suddenly became nowhere near enough.

Strip away the public spending, during the boom, growth is slow. Basically Gordon was funding the majority of the country's economic growth through increasing public spending massively, the rest was being funded by private and company debt which went through an unprecedented increase.

What we weren't doing was producing.

My only concern is that the coalition seem to obsess over debt fuelled growth as well. The other big problem is that people think they are entitled to the client state that Labour brought in, one that is not and will never be affordable.

You can whine all you want about the cuts, they are the biggest since war time, but then we've just had the biggest increase in public spending in memory, 50% in real terms in 10 years, tons of regulations, red tape, ineffective, job costing regulations, increased taxation.

The cuts are rolling things back to mid-2000s spending level, still way too high but Labour have managed to create the entitlement client state UK where everyone expects to be able to live beyond our means and for the world to just hand us money so that we can. After all they did it for a decade. People as a whole expect more from the government now, so withdrawing that will be a slow process made more painful by selfishness within local departments who merrily cut front line services rather than all the unnecessary bureaucracy they acquired.

Every indicator also shows that the massive increase in funding within the public sector was partially offset by reduced productivity, this in a time when the private sector increased productivity considerably. Loads of unnecessary management, regulations, targets and inefficiency.

This ignores the over a hundred billion of PFI that the conniving crapsack kept off the balance sheet but are having to be paid by us, our children and our grand children.

I'm sure someone will correct me if I'm wrong but I can't think of such a splurge in government spending, outside of war time, since when Britain was ruled by a monarch not a parliament.

George Osborne has pulled an incredible confidence trick actually. He's blagged the world into lending a country with anaemic growth, the 3rd largest budget deficit in Europe behind Greece and Ireland, a public sector net debt that'll be closing on Italy's levels by the end of this parliament money at AAA interest rates.

In 1987 the combined debt of businesses, households and the government was twice our gross domestic product, if we put absolutely everything we produce towards paying debts they'd be clear in 2 years.

After a slow but steady rise during the 80s/90s Labour tinkered with the BoE and invented the FSA, rather rapidly a credit boom began, the BoE powerless to intervene as asset inflation wasn't their mandate only retail.

By 2009 the total owed by businesses, private individuals and government was 5.6 times GDP, sitting at £7.5 trillion. Oh, and yes, a large proportion of this was mortgages, people fapping themselves senseless over property porn. Indeed in 2008 less than 1/3rd of the mortgages taken were for houses people wanted to live in, the rest were buy to let and equity release.

It's expected that by 2015 this value could be £10.2 trillion - a lot of the coalition's deficit cutting plan consists of shifting debt from the government's books to private individuals, cutting public spending and hoping private debt will take up slack and provide more fake growth while they try and rebalance things.

The rebalancing isn't working, the environment isn't right to try and turn the UK into Germany, but to try and stop the austerity programme would be suicidal now even though I don't like it any more than anyone else, the only options are yet more QE inflicted inflation, I believe a total of £400 billion was mentioned as a possible target, along with some targeted tax cuts.

We're up the creek without a paddle. Gordon urinated away all the money so the government couldn't do the usual thing that's done to try and manage contractions in the private sector, which would be to spend money on infrastructure, so they're trying some schemes to increase private sector investment in infrastructure and reduce some burdens on businesses.

The way it's supposed to work, Arthur, is the economy goes through cycles of boom and bust. During the boom periods if you're a good Keynesian like Ed Balls claims to be you run a surplus, pay down debt and get some cash in the savings account, then when the bust comes you plough those savings into infrastructure and capital expenditure projects.

Please note I said infrastructure and capital expenditure. Absolutely not business as usual overweight government running with way more resources than are required, Keynes said that deficit spending fund productive CapEx only.

Of course it doesn't work so well when you run 2% deficits at the absolute height of the boom which then become 11% deficits during the bust when tax receipts drop leaving not much of anything for stimulus or investment and necessitating getting spending under control.

Historically the UK averages 40-42% of the economy paid in tax, without spending cuts that needs to go up to 50 which would bring us near to Sweden, Denmark, etc, and leave you jumping up and down over the increased taxes.

[Will21st]

Originally Posted by Hugh

Ahhhhhhh.

So, in summary - rant, mumble, invective, diatribe, more invective, mangling of language, rant, mis-spellings, random punctuation, more ranting.....

Two minds, thinking as none - with your posts next to each other, there may be the possibility of your neurons sparking a synapse.....

Doubtful, though.

You,Sir,are in top form today!

[chris9991]

Originally Posted by Ignitionnet

(SNIP)

Historically the UK averages 40-42% of the economy paid in tax, without spending cuts that needs to go up to 50 which would bring us near to Sweden, Denmark, etc, and leave you jumping up and down over the increased taxes.

That's actually a really good post
Certainly tallies with a lot of how I feel. I just hope all the capex is not just a white elephant, but is actually useful. Otherwise we just leaden the children with more debt