The Comprehensive Spending Review Thread

[Chrysalis]

ours is different to what the canadians did.

they didnt protect any budgets.

[Traduk]

Originally Posted by Chrysalis

ours is different to what the canadians did.

they didnt protect any budgets.

The end product is the same. Remove liquidity (spending power, money in circulation) and unintended consequences follow with the ripple or domino effect.

Protected budgets are meaningless to individuals. There is a hospital within the ring-fenced NHS not 25 miles from where I live that has announced 600 job losses within a single trust. I expect that over and over again because protected budgets are having the spend focus changed. As always the devil is in the detail and many details never become public.

My sister is currently on holiday here from Vancouver (lived there for 40+ years) and she remembers that model well as she did voluntary work in the soup kitchens and food\ clothes distribution centres. It caused pain in globally improving environment so I hate to think of the outcome in a stagnant or declining environment.

[Ignitionnet]

Originally Posted by Traduk

We are adopting the Canadian model which was used to very painful but good effect from 1993 to 1999. It worked for them because the most vigorous period of global growth started and ended during their grand experiment (1992 to 2000). We need the same burgeoning global growth but there isn't a snowballs chance of seeing it.

The BBC seems to disagree with you on this.

http://www.bbc.co.uk/news/10254055

When Canada started on its spending cuts in 1992, the country was still mired in an economic downturn.

And despite the Canadian economy not firmly picking up until 1996, Ottawa still continued with its extensive deficit reduction work.

---------- Post added at 17:36 ---------- Previous post was at 17:33 ----------

Originally Posted by Traduk

The end product is the same. Remove liquidity (spending power, money in circulation) and unintended consequences follow with the ripple or domino effect.

The only solutions then are to either ignore it or to increase taxes. Taxation will reduce spending power, incentive to work and cause multinational companies that contribute so much of our tax revenue to leave likely resulting in no benefit.

Ignoring it will create a deeper deficit that must be funded and almost guarantee more expensive borrowing in the future further increasing deficit due to higher interest payments.

Before you're so nasty on the reference agencies by rights the UK and USA should already have been downgraded. The only reason we haven't is historical, we're the UK.

[Traduk]

Originally Posted by Ignitionnet

The BBC seems to disagree with you on this.

http://www.bbc.co.uk/news/10254055



---------- Post added at 17:36 ---------- Previous post was at 17:33 ----------



The only solutions then are to either ignore it or to increase taxes. Taxation will reduce spending power, incentive to work and cause multinational companies that contribute so much of our tax revenue to leave likely resulting in no benefit.

Ignoring it will create a deeper deficit that must be funded and almost guarantee more expensive borrowing in the future further increasing deficit due to higher interest payments.

Before you're so nasty on the reference agencies by rights the UK and USA should already have been downgraded. The only reason we haven't is historical, we're the UK.

Did you miss the fact that I used "global".

The only thing that replaces a local economy is exports to a larger "global" economy and that is what made the Canadian experiment work. They drastically reduced the public sector and thanks to a burgeoning global economy the private sector eventually took up the slack. The private sector found business in exports.

We have done some things in reverse inasmuch as we lost over a million jobs in the private sector, many of which found their way into the public sector. The coalition, in its wish for list, hopes that the private sector will take up the slack with the unemployed flowing back the other way along with all the people it deems fit for work. The private sector will be constrained within a smaller domestic economy so exports will be the only solution. The major UK trading partners are in no shape either now or the foreseeable future to engage in buying anything much of what we may produce and we are in no position to compete with the Far East.

With the options available I agree that we are between a rock and a hard place but I do think that rather than rushing off like hares the busy young men should have taken a more tortoise approach. There are levels of structural debt ratios that are internationally acceptable and it may have been possible to operate on a slower less socially damaging timetable. However the guys in charge are on a mission and have such a short window of opportunity to make their mark on history.

I like the tongue in cheek last paragraph. Good to have friends in the right places. I thought it was funny that Cameron went to the USA with press comments of "heck you guys are doing it wrong" and came back with a ringing endorsement of "hey that's great idea but not for us"

BTW Quietly and without fanfare, my sister informs me that, Canada are still cutting back and at an increasing pace since the global economic mess. They have been fixing the fix ever since they started the fix.

[NitroNutter]

Originally Posted by Hugh

"The systematic and progressive dismantling of the welfare state" - what are you on?

Some facts for you (I know you don't like these, preferring diatribes and polemic, but some of us base our discussions/propositions on the real world, rather than some Third International/CPGB version of it) -

Government Spending in £billion*
Department_____1990_____2000_____2007_____2010
Pensions/Welfare.....53.............125...........177...... ......222
Health....................29.............48....... ......94............120
Education...............25.............42......... ....75.............86

Obviously a new version of "dismantling" I hadn't come across before - "I am dismantling your house, but I am also, over 20 years, quadrupling the amount of money spent on it".....

btw, don't you think you are being a little dramatic equating a democratically elected Government which is trying to balance a country's budget to provide a stable base for growth in the future (without building up huge debts and deficits which would have to be paid off by our children), with one that banned all other political parties, started a war which killed over 60 million people, committed extensive acts of genocide, and invaded Poland, Denmark, Norway, Luxemburg, Netherlands, Belgium, France, Yugoslavia, Greece, Vichy France (and tried with Russia).

You appear to be comparing apples with giraffes, imho....


*source - UK Public Spending

So in reality and relative to the ever decreasing spending power of the pound at a seemingly ever accelerating rate not a fat increase in public spend then ?

Democratically elected ? If our institutionalised dysfunctional electoral system is your idea of democracy then your welcome to it, to me even the coallition cannot claim to be truly representive of the people and barely scraped enough undemocratic electoral seats together to claim their false majority, and thats before we start looking at such failings like party dogma.

Originally Posted by myself

Nothing melodramatic here, past experience with various government departments tells me I should look to the worst case scenario and judging by the words of the current administration this is perhaps going to be the worst administration since Hitler.

Whereby you invoked godwins law:
Please enlighten me where I aligned Mr Camerons potential reign of dictatorial tyranny to the one of Hitler when I clearly stated a comparison of all since his reign, the era which coincidently bears particular importance and relevance to major developments within many aspects of the welfare state of today and certainly not excluding the inception of the NHS which arrived shortly after Mr Hittler left, just as did the wheels of todays comprehensive education also begin to gain momentum during this period. If the policies of the current government do result in any form of social cleansing then I certainly hope they will be just as well remembered for their notoriety.

If such terminology which I had tried to refrain from using is offensive and carries any perceived similarity to that era then perhaps the government should reconsider the methodology behind its current policy proposals in order to ensure such events cannot and will not occur, it is their policies and the threats they carry against the smallest, poorest and most vulnerable minority group in our society most of who'm in reality are barely on a minimum wage equivalent causing the problems of which tycoons like Mr Murdoch are in favour of and no one elses whilst garnering a frenzy of public support from very convenient selective journalism in the various tabloids on a small selection of extreme situations.

Ok so looking beyond this now as it will probably go through like so many poorly thought out government policies do, just where are the 2.5 million or so incapacitated people that can miraculously be deemed fit and available for work going to find employment not forgetting we will be fighting the half a million the government is throwing out for similar positions in the private sector. All this in the name of sticking a minute dent into an ever increasing defecit thanks to an impossible to reverse debt driven economy which will probably cost far more to implement than it will ever save ?

You're right, Nitro - we should just not do anything, and everything will turn out magically all right.

Your cohesive and fluent proposition has convinced me of the error of my ways, thinking that perhaps not leaving huge debts to my children was not the optimal solution - there is no problem so big or complicated that it can't be ignored.

<fingers in ears> La la, la la lah, la la la lah......

[Chrysalis]

Originally Posted by Traduk

The end product is the same. Remove liquidity (spending power, money in circulation) and unintended consequences follow with the ripple or domino effect.

Protected budgets are meaningless to individuals. There is a hospital within the ring-fenced NHS not 25 miles from where I live that has announced 600 job losses within a single trust. I expect that over and over again because protected budgets are having the spend focus changed. As always the devil is in the detail and many details never become public.

My sister is currently on holiday here from Vancouver (lived there for 40+ years) and she remembers that model well as she did voluntary work in the soup kitchens and food\ clothes distribution centres. It caused pain in globally improving environment so I hate to think of the outcome in a stagnant or declining environment.

yes because nhs budgets are still been squeezed as the tories are rediverting the funds. not to mention even a protected nhs budget is under cost pressure.

protected budgets make quite a difference as it affects confidence as well as how proportionate the hit is to everyone.