Back in recession

[-:Undertaker:-]

http://www.spectator.co.uk/coffeehouse/7808078/ballss-argument-is-detached-from-reality.thtml

The United Kingdom slips back into recession (http://www.bbc.co.uk/news/business-17836624)

Balls's argument is detached from reality


http://www.spectator.co.uk/article_images/articledir_15616/7808078/1_fullsize.jpg
Labours Shadow Chancellor, Ed Balls


So who killed the recovery? Ed Balls points to a ‘recession made in Downing St,’ and has gone on a victory tour today. ‘I have consistently warned David Cameron and George Osborne for over a year that going too far and too fast on spending cuts would backfire,’ he says. ‘Arrogantly and complacently they ignored those warnings, and the country is paying a heavy price.’ Facts are always the remedy to an outbreak of Balls. The government releases monthly spending figures, which show an increase overall. That’s due to the rising cost of debt and dole, you might say, but strip those two out and you have what the ONS calls ‘core government spending’. The below figures compare core spending during the financial year just gone with the same months under Brown:


http://www.spectator.co.uk/article_images/articledir_15616/7808078/2_fullsize.png


Osborne will not release such figures in his defence, because he isn’t wild about admitting the slow pace of his fiscal consolidation. Thus the political argument has become detached from the economic reality.

The three main political parties are staging a dishonest debate, as is most of the media. The cut in public spending exists only in the minds of those who a) believe everything they read or b) are politically tribal.

The economy will not recover and cannot recover until spending is slashed, until then we are heading for bankruptcy.

Thoughts?

[Ajthedragon]

I think we're in recession due to a lack of consumer confidence, not reduced public spending. This low consumer confidence has been caused partially because of reduced spending, but mainly due to the EU crisis. Also looking into the figures, construction was the main factor in contributing to our economy shrinking, so I don't think things are as bad as they make out.

[e5]

Saw this yesterday. It's official. lol

[Adam]

I didn't feel the last recession and probably won't feel this one, doesn't affect me in any way.

This country is in the **** hole anyway it's only a matter of time before we're all German.

[-Sweex]

Really we never left it!

Cutting loads of public sector jobs and putting them all on the dole is really going to help the economy? Increasing fuel prices? They have got it all wrong!

[dbgtz]

I think in terms of money spent, you have to take into account redundancies and previously planned investment from Labour before saying the Tories are just lieing. I think we'll see the big decrease post-olympics.

Also I'm surprised you didn't post about the 6.8% EU increase of funding proposal.

[Mathew]

I think we're in recession due to a lack of consumer confidence, not reduced public spending. This low consumer confidence has been caused partially because of reduced spending, but mainly due to the EU crisis. Also looking into the figures, construction was the main factor in contributing to our economy shrinking, so I don't think things are as bad as they make out.

It's funny you should mention the whole construction business. My Dad has just been saying that most construction projects are planned around two years in advance, so the fact that there's a lack of activity in that area at the minute is due to factors that occurred two years ago. We're just experiencing the knock-on effect at present, so in order for the results to be valid, we'd need to look at orders which are being placed right now. Apparently the construction sector equates for around 9% of the economy, although I have no idea about any more details or sources! :P

[-:Undertaker:-]

I think we're in recession due to a lack of consumer confidence, not reduced public spending. This low consumer confidence has been caused partially because of reduced spending.

There has been an increase in public spending, not a reduction.


Really we never left it!

Cutting loads of public sector jobs and putting them all on the dole is really going to help the economy? Increasing fuel prices? They have got it all wrong!

The public sector is a drain on any economy, no matter how much you think some of it may be a need.

Labour increased the number of public sector workers by 800,000 - that should just be the start of it.


I think in terms of money spent, you have to take into account redundancies and previously planned investment from Labour before saying the Tories are just lieing. I think we'll see the big decrease post-olympics.

The government's own figures (above) take this into account and show that from now until 2015 (which are the last forecasts) spending is going to continue increasing. We are now spending more now than we did under Gordon Brown, indeed under the governments insane spending plans we will not be spending less than him in any year up to 2015.

I do wish desperate Conservatives would stop trying to defend the only positive they had about their party, which turned out to be totally false. I am glad Nigel Farage has got the message and stated it last night on Question Time - the entire 'cuts' debate is fake.


http://www.youtube.com/watch?v=v_Ws_ZqAJtI

[-Sweex]

There has been an increase in public spending, not a reduction.



The public sector is a drain on any economy, no matter how much you think some of it may be a need.

Labour increased the number of public sector workers by 800,000 - that should just be the start of it.



The government's own figures (above) take this into account and show that from now until 2015 (which are the last forecasts) spending is going to continue increasing. We are now spending more now than we did under Gordon Brown, indeed under the governments insane spending plans we will not be spending less than him in any year up to 2015.

I do wish desperate Conservatives would stop trying to defend the only positive they had about their party, which turned out to be totally false. I am glad Nigel Farage has got the message and stated it last night on Question Time - the entire 'cuts' debate is fake.


http://www.youtube.com/watch?v=v_Ws_ZqAJtI

Labour increased it by 800,000 to create jobs in the north where there was a significant north/south divide. I live in the North-East and the region around here is totally dependant on the public sector. The drain on the economy is people living off the dole and not even attempting to look for work - benefits were set up so there was a safety net for redundancies it wasn't meant for a lifestyle.

[-:Undertaker:-]

Labour increased it by 800,000 to create jobs in the north where there was a significant north/south divide. I live in the North-East and the region around here is totally dependant on the public sector. The drain on the economy is people living off the dole and not even attempting to look for work - benefits were set up so there was a safety net for redundancies it wasn't meant for a lifestyle.

Actually the drain on the economy (the private sector) is the massive burden of the bloated public sector which is stuffed full of non-jobs. If government could simply create jobs which you seem to think create wealth and produce, then we'd have 0% unemployment wouldn't we? every public sector job takes from the productive sector and inhibits its capacity to grow including in regions like yours and mine (Liverpool being classed as one of the most deprived cities).

Believe it or not, its actually cheaper to pay somebody a smaller wage from the taxpayers wallet to sit around as opposed to pay them become a 'Enviromental Officer' for the Council on £40k+ a year.

[Lee]

Hmm I didn't feel the last one, and with any luck I won't feel this one.