UK Politics: Not even a Penny for a new Prime Minister

[Liffguard]

34 minutes ago, A Horse Named Stranger said:

Fixing at least some of the damages they have done during their time in goverment will take time and money.

Money which Starmer and Reeves have largely ruled out spending. I'm sorry, but this is the core of the objection. The left-wing objection to Starmer is that there are certain policy priorities that need to be enacted to start reversing the damage of austerity, and that he has mostly ruled-out enacting them.

 

Quote

You have councils on the verge of bankruptcy, failing public services, the increase in foodbanks (which preceded the Russian invasion) etc.

Exactly, and the left-wing objection to Starmer is that we are unconvinced he's going to actually do anything about these problems.

 

To put it in the most ultra-simplified terms possible, Corbyn had bad electoral politics, but good policy. Starmer has good electoral politics (debatabely, it's a point of discussion the extent to which current polling success is down to factors that are largely external to him, but let's allow if for now for the sake of argument) but bad policy. And we don't want a government that enacts what we consider to be bad policy. That's really the core of it.

[Liffguard]

1 hour ago, Heartofice said:

So saying they will implement policies that they cannot afford and won’t create much benefit ( except in the heads of far left voters) isn’t going to help them. Suddenly they have to be realistic. 

 

 

It's a point that's been made before, but austerity is the thing we can't afford. Austerity has made the public financial situation worse. It's kicked necessary infrastructure spending down the road, creating greater long-term costs in favour of limited short-term savings. It's choked growth and stirred social unrest, and hollowed out state capacity. Promising more austerity is the crazy, unrealistic promise. More public investment is the sober, sensible position.

[Heartofice]

32 minutes ago, Liffguard said:

It's a point that's been made before, but austerity is the thing we can't afford. Austerity has made the public financial situation worse. It's kicked necessary infrastructure spending down the road, creating greater long-term costs in favour of limited short-term savings. It's choked growth and stirred social unrest, and hollowed out state capacity. Promising more austerity is the crazy, unrealistic promise. More public investment is the sober, sensible position.

Well he hasn't said he's going to 'carry on with austerity', he's just pointed to the bad state of public finances, the highest tax burden in 70 years and said he can't just rashly start turn on the magic money tap. 

[Spockydog]

 

 

[The Anti-Targ]

Oppositions don't win elections, incumbent governments lose them. The current polling is almost entirely down to the Tories losing the confidence of what appears to be a large majority of the country. That the votes are mostly going to Labour is by tradition as much as anything.

I would wager most Labour MPs want to do what should be done to fix the broken things, but they still believe the balanced budget myth and that taxes pay for govt spending. Until the left in general stops swallowing that lie it will never be able to deliver on the policies it really wants to deliver.

The correct thing to do is cut taxes on productive activity, wages and salaries (at least for people in the bottom 66%), VAT and company tax, and increase spending in the areas of greatest need, and of course axe planned govt spending that clearly is a waste of money (Rwanda plan).

I will give HoI some credit for actually recognising that the magic money tree exists. Too many people don't even know that. Though not sure what's worse, knowing it exists and insisting that it never be used, or not knowing it exists and thus placing harmful constraints on govts out of complete ignorance.

Edited March 23 by The Anti-Targ

[Heartofice]

24 minutes ago, The Anti-Targ said:

I will give HoI some credit for actually recognising that the magic money tree exists.

Well let’s just say I’m highly sceptical of it, despite you speaking about it as if it’s a fact every week here.

[The Anti-Targ]

To be fair, I try to keep my preaching of MMT to fortnightly.

People should be wary of the magic money tree because govt spending will always require discipline, and who has a terrible track record for spending discipline when they have lots of money to throw around? The people you put in charge of public finances should be honest, trustworthy and mature, as well as having the general public good at the heart of their motivations.

[Werthead]

I'm not even sure if you have to appeal to the MMT as a means to an end (by which I assume is the "if you have your own currency you can summon money out of thin air as long as you also avoid inflation" approach, which is both correct and also not without risks). If a government invests in services and people, it usually gets a return which dramatically improves upon the initial investment. The problem in the current situation is starting on a bad foot (unlike 1997 when Blair inherited a significantly improving economy and nothing like the current national debt, which meant opening the floodgate of spending was much easier to sell to the public) which makes that look almost irresponsible in the short term despite being almost inevitably successful in the long term, and frankly it is necessary at this moment. The damage heaped onto the British economy since 2010 (following on from the systemic shock of 2008) by austerity is unsustainable without doing fundamental damage to how the entire country is financed and operates.

One of the big problems we have in the country is that in 2010 the coalition successfully sold the idea that national finances are just like household finances and need to be treated the exact same way (tighten your belt and then tighten some more, cut up your credit cards, don't take on more debt), when this was, never has been and never will be remotely true. The problem is that that was a very simple message and getting into the weeds of how national finances work is complex, long-winded and requires some degree of specialist knowledge, messaging which is almost impossible to get across in the current media environment. I suspect current Labour planning revolves around this and knows that long-term repairs to the economy require at least two terms, but if they go in all guns blazing in the first term, the Tories will be able to claim Labour irresponsibility and try to win back into power in the second term, undoing whatever good work is done in the meantime (assuming they can achieve that, of course, which is not a given, although the fruit is hanging very low).

[DMC]

13 minutes ago, Werthead said:

I'm not even sure if you have to appeal to the MMT as a means to an end (by which I assume is the "if you have your own currency you can summon money out of thin air as long as you also avoid inflation" approach, which is both correct and also not without risks). If a government invests in services and people, it usually gets a return which dramatically improves upon the initial investment.

Yep.  The argument for aggressive government investment given the current state of the UK economy isn't MMT, it's just a return to basic Keynesianism.

[Spockydog]

"Nobody understands the economy." 

- Ben Cafferty

[Bironic]

6 hours ago, Werthead said:

One of the big problems we have in the country is that in 2010 the coalition successfully sold the idea that national finances are just like household finances and need to be treated the exact same way (tighten your belt and then tighten some more, cut up your credit cards, don't take on more debt), when this was, never has been and never will be remotely true. The problem is that that was a very simple message and getting into the weeds of how national finances work is complex, long-winded and requires some degree of specialist knowledge

That seems to be the message of all the center to extreme right parties across the western world, with very similar outcomes everywhere. It’s just a very simple, understandable and apparently effective message… 

[Heartofice]

One of the major issues in this country is the sheer inability to actually build things, which is more than just an issue of lack of funds. Putting up a shed in the middle of a field would probably require sign off from 200 different groups, a 7 year planning process, £1.2bn in consultation and would still lead to wild outrage from the local NIMBYs.

Edited March 24 by Heartofice

[A Horse Named Stranger]

Ah, the red tape delusion.

[Heartofice]

4 minutes ago, A Horse Named Stranger said:

Ah, the red tape delusion.

How is it a delusion?

[A Horse Named Stranger]

It's basically a cheap populist trick (not so coincidentally also one of the Brexit selling points). Let's put it into some form of satirical dialogue.

The problem was not our bad policies (cutting spending) that's the cause of crumbling infrastructures, lack of new building projects. Plans being held up in agencies or courts, is not down to understaffing (related to cutting costs)

Then what is it?

It's regulations!

Like what regulations?

There's so much regulation, it just stops us from achieving greatness

Like whar regulations? Enviromental? Workers' protection? WHAT REGULATIONS!

There's just too much red tape. We need to cut it to get growth, growth, growth.

I guess you are right. We need to do something about regulations.

 

Quite a few of those rules, or red tape, are there for reasons and not stop building stuff. can overregulation be a problem, yes. Bigger problem is lack of funding.

[Heartofice]

25 minutes ago, A Horse Named Stranger said:

It's basically a cheap populist trick (not so coincidentally also one of the Brexit selling points). Let's put it into some form of satirical dialogue.

The problem was not our bad policies (cutting spending) that's the cause of crumbling infrastructures, lack of new building projects. Plans being held up in agencies or courts, is not down to understaffing (related to cutting costs)

Then what is it?

It's regulations!

Like what regulations?

There's so much regulation, it just stops us from achieving greatness

Like whar regulations? Enviromental? Workers' protection? WHAT REGULATIONS!

There's just too much red tape. We need to cut it to get growth, growth, growth.

I guess you are right. We need to do something about regulations.

 

Quite a few of those rules, or red tape, are there for reasons and not stop building stuff. can overregulation be a problem, yes. Bigger problem is lack of funding.

You might want to check out the Lower Thames crossing application, the planning stage of which has cost £300m before any building work has even begun.  The application itself is 356,000 pages long, and it’s taken 13 years to even get to this stage. One of the things holding up that application was figuring out the best place for newts to live. 
 

The overall cost of the crossing has ballooned to £9bn. For context, Norway built the longest tunnel in the world for about £290m.

So please don’t go telling me the problem is a lack of funding. 

Edited March 24 by Heartofice

[A Horse Named Stranger]

Which involved plans for alternative routes, enviromental impact assessments, since it's a public project developers lowballing to get the job and also some changes to initial plans, viability studies, inflation.

[Heartofice]

4 minutes ago, A Horse Named Stranger said:

Which involved plans for alternative routes, enviromental impact assessments, since it's a public project developers lowballing to get the job and also some changes to initial plans, viability studies, inflation.

You think it’s reasonable then do you?

[Bironic]

55 minutes ago, Heartofice said:

You think it’s reasonable then do you?

I would say building new highways is never reasonable…

it’s scientifically proven that they don’t solve traffic problems, induce demand, cost a shitload of money to maintain, have small carrying capacity, use up too much land, destroy the environment, pollute the air, seal off large swaths of ground (which is problematic in case of floods/rain etc), increase carbon emissions, increase microplastic emissions, decrease life expectancy due to dust and poisonous gas, decrease quality of life due to massive noise pollution, are inefficient to transport goods, increase light pollution, lead to global warming, and I could probably continue on for several pages…

a better example would probably be high speed rail in the UK, and there funding seems to be at least part of the problem…

[A Horse Named Stranger]

Public infrastructure projects pretty much always go over budget. 2bn was the first estimate iirc. Usually, you can take the first agreed number and double it mentally. It's usually a combination of Goverments lowballing with their estimates to sell it to the public (taxpayes money etc.) companies bidding on the contract well knowing the rules. And then goverments making last minute changes to the original plans to pacify one group or another. Building right now is super expensive, I don't know if you have noticed. Loans/mortage rates, materials, energy prices.

4x seems a bit excessive. If they went for 2bn to 6bn (3x) I could kinda see how that happened (new highways/motorways/autobahn miles) are sorta notorious in that regard iirc. werthead or anti-targ will probably have a better idea.

If you take the Chinese approach (basically fuck the enviroment, we don't really care about that), you could obviously drive costs down. E.g. the Chinese built a highway bridge somewhere in one of the balcan republics (not sure but I think it was Montenegro (?)). It was sorta prestige project for the goverment. Studies showed it not to be viable economically. Chinese loaned the money under the condition that the job gets done by a Chinese company. The once lively river that bridge crossed has been killed in the process. Oh as a bonus, that road is not economically viable, and that goverment now has a real problem serving the Chinese loan and China has increased its influence.