Do Tory deeds match the words?

We are slowly starting to see some clear blue water between Labour & the Conservatives.

The idea on tax certainly for businesses is that you will pay a lower rate but with more simplicity and less of a demand for "tax tourism" for larger businesses the actual receipts might rise.

The "age of irresponsibility" included the Torries. I believe they would have had opportunities to voice concerns over the coming financial collapse but obviously did not do so when provided the information. The idea of "collective" irresponsbility of course insures that no individuals will be held responsible, say..bankers and their boards and elected individuals who did nothing when warned.
If the government were to take the bad housing and other loans that they so chairitably took off of the hands of the banks, and returned them to the banks, much of the debt problem is solved. It seems the private sector initiative will be based on the old system of the taxpayer underwriting of private sector adventures. If services are simply contracted out to the private sector there is no real savings, but making a profit on the poor and needy has been a traditional national endeavor.
The bankers will remain in control so nothing is really new, except the wording.

Neither the conservative or labour have thus offered any common sense approach to the primary problem, namely government debt.

From the point of view of tax: What percentage of GDP can tax be increased to, whilst still resulting in an increase in tax revenue?

Find a blank piece of paper and:
Draw a vertical axis and name it ‘Gross Revenue Collected’.
Draw a Horizontal axis and name it ‘Gross Domestic Product’.
Where the two axis meet write the numeral ‘0’.

At a point sufficiently distant from the numeral 0 on the horizontal axis write the numeral ‘100’, this equating to 100% of the Gross Domestic Product.

Now assuming you tax at the rate of 0% of GDP, clearly you will get no money in.

Now assume you tax at the rate of 100% of GDP, again you will get no money in.
Why you may ask? Well, would you work all week to give all that you earned to the Government, and be unable pay for food, clothes or anything else for that matter?

Consequently there is a point between 0% and 100% tax rate of GDP where the Government tax receipts will start to fall if the overall rate of taxation is increased.

Given that the simplest answer is usually the correct one; that point is 50% of GDP.

Therefore to connect the points 0 and 100 on your graph, get a suitably sized semi circle and draw the curve connecting the two.

It stands to reason that when one attempts to tax at a higher rate than 50% of GDP, then tax revenue will gradually start to decline, and the father past 50% you go the faster the decline will be.

So irrespective of politics, irrespective of whether you are a staunch Tory or Labour supporter, there is a limit to what you can raise in tax revenue, namely 50% of the Gross Domestic Product.

So given that tax revenue is finite what will they do?
Answer: They’ll print more money until such time as public expenditure is cut to match tax revenue.

Mervyn King will be summoned to magic up some more money and sterling will fall in value further whilst savage public sector cuts are organised.

It’s not about politics this, it’s about mathematics.

The tax code certainly needs simplifying and "loopholes" closing. If we can trust any politician to risk their funding and future Directorships in the City is another matter.

If is all just words in the hope there are a few votes in it. Honesty on the part of all the Political parties is to be preferred over the "shadow" reality we are now in.

Whatever is in their manefestos whoever gets in we will hear "having looked at the books we need to raise taxes by X and slash and burn spending by Y".We should have guessed.

"Most focus will doubtless be on the credibility of the party's plans to cut public-sector borrowing - and also on whether the Tories are right to put a greater emphasis on public-spending reductions, and a lesser weight on tax rises, than Labour."

That's because the people who 'bring focus' are idiots - the focus should be how a Economic libertarian party which ideology is 'less Government intervention' is going to regulate the cowboys of the financial world when the previous regime (Labour) who are traditionally regulation heavy - failed to even come close!

You see what those of us with half a brain see that with the Tories is an abandonment of principle in order to obtain power.

Does that sound like a morally sound party to you?

Please don't take this as a steer to vote for Labour - that is certainly not my intention.

The electorate needs to wake up and realise that the very principle of the conservative campaign - 'choice' - is exactly what is absent from this election.

Monster raving loony party - the country is in safe(r) hands.

Everybody is pussy-footing around with the problems: what gives?

Are there powerful entities, who mustn't be spooked for fear of the consequences?

Surely it can't be the voters the politicos are frightend of?

At last we can see the main difference. A massively expensive overpaid and inefficient public sector (labour) or more self determination and a much smaller public sector (tory). Hooray now all we need is for the public secor pension time bomb to be defused!
Time for Brown to go

Cameron's promise today to "involve all the people all the time in decision making" does this mean the abolition of the Whips and their office and grant the power to the people to instruct their MP to vote for the PEOPLES decision on major issues? or will the deceit of the dishonarable Parliament continue.

13 April 2010


Subject: Why we need Tax Incentives for Reduced Corporate Borrowing and Working Capital Reduction

Mr. Peston:

In a few weeks, the British people will vote in the closest and least predictable election in living memory. It is likely that whatever the result, this will be thought of as a genuine game changer about how politics are approached in this country and how the electorate are expected to interpret increasingly complex arguments that our political class presents.

REL, the world’s leading specialist working capital consultancy, is discouraged that the core decision required of the electorate is not fully focused. Instead, everything we hear relates to cost cutting and tax increases. The reality is that the huge deficit incurred by the current government must be reduced by the next.

But the parties refuse to focus on WHY it is important to reduce the deficit.

It is true that huge government deficits will increase long term interest rates. As interest payments account for an increasing portion of government expenditures - if no action is taken - it will be much more difficult to service the nation’s debt. Though we (REL) concur with this rationale we disagree that this is the only action that can be taken by government.

Regardless of political affiliation, ultimately, everyone wants a healthy private sector, which produces thousands of well paying jobs but this will require investment. Most British companies will need to borrow money to make those investments – but there’s a catch. If the government can’t somehow reduce borrowing, the cost of doing so to the private sector, will rise, restricting the ability to invest, grow and create the sustainable jobs needed for economic recovery.

But this works both ways...if private sector needs are lessened or if it can reduce current borrowings, then long term interest rates will be easier to control. If the total demand for borrowing is less, the price of borrowing will also be less. So it should be in the government’s interests to encourage the private sector to reduce its need to do so.

REL knows from its annual survey, of the UK’s top companies, that working capital – accounts receivable, plus inventories, less accounts payables – could be reduced by as much as £40 billion. This figure is close to covering the entire defence budget for one year and more than the government budgets for Education, Law and Order or Transport.

In removing £40 billion of demand from the UK debt market - over a five year period – it’s likely to expect a further decrease in long term interest rates. It follows that government should encourage the private sector to increase working capital efficiency in order to reduce the cost of private investment in those new, needed jobs.

REL recommends that the government should offer private sector tax incentives to manage working capital more efficiently and to reduce external borrowing. This scenario not only helps the government and private sector but could make funds available through the major banks for small businesses currently desperate for them to release new funding.

Tax breaks for managing working capital will help everyone to keep long term interest rates down, which is good for government, big business and small business. During the next Parliament, we all know there are tough decisions to be made but we should be maximising the opportunity to reduce long term interest rates and create more economic winners.


Yours Sincerely,

Brian Shanahan
[Personal details removed by Moderator]

By-jove Robert...I think you're beginning to get it!

Robert wrote:

"So the reform won't be universally popular in the business community: pain will be felt by some businesses, especially manufacturers - which are widely regarded as important to the UK's ability to generate wealth."

It's the last line that shows you're coming round. The word 'vital' would have better to use than 'important' in the last sentance.

However, it also includes a message of more 'doom-n-gloom' for the UK's true wealth generating manufacturers :o(

Ian_the_chopper wrote:
We are slowly starting to see some clear blue water between Labour & the Conservatives.


If only there was someone who'd push the lot of them into it !

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> Which may mean that many of our biggest international
> companies could find themselves paying rather more tax
> under the Tories' simplified, lower-rate, territorial
> tax system.

Stop, Robert, you are making my mouth water!

"And arguably - just like the government - the Tories would actually do everything in their power to deter any great escalation in the repayment of debts by households and businesses, or any sharp increase in saving, for fear that the consequential collapse in spending would tip the UK back into recession."

Does anyone else read this as "we want you to stay in debt in order to keep the Economy going - regardless of the consequences for the individual or business"

Is this what DC means by 'a more responsible Britain'?

Both Tory and Labour manifestos are so full of holes it's ridiculous. What a shame most mainstream journalists are finding it difficult to spot the massive contradictions in their statements.

This is why I have started to watch Newsround for my in depth and concise analysis of the election.

This is entirely specious. Macroeconomic orthodoxy distinguishes public and private but this is a very crass assumption. No wonder we can lose billions! Slavish adherence to outdated economic formulae (however complex) is no substitute for common sense.

Whichever government wins and whatever corporation tax measures they decide on, you can be assured that HMT and HMRC will not consider the tax reporting implications (IAS 12 etc) of their tax proposals - they never do!
Both main parties have talked about bringing in extra tax charges on banks. Might help the public finances if HMRC were given the political backing and the resources to go and collect the existing taxes the banks wriggle out of. For whatever reason, and it might be plain incompetence or a simple lack of courage, Labour chose not to do so.
Finally, I still find it amazing that HMG tolerate the situation whereby some major UK banks are allowed to run well capitalised structured tax avoidance businesses. Funny old world and all that, isn't it?

As stated before in answer to Nick Robinson's blog-how much is the public sector deficit? £170bn?
How much was the bail out of the banks? £200bn?

This is a government bailing out private industry. Before any cuts are made to public services or any bonuses are paid to bankers, i want my money back.

The choice is simple, do we use tax, that targets those who earn money and can be targetted at those who are wealthier, or do we want service cuts that affect everyone, and particularly the disabled and disadvantaged, the elderly and the vulnerable youngsters in our society.

One is taken from those in work and rises as the economy grows and unemployment shrinks and reduced government funding needed for benefits.

The other reduces what we spend on services for the community, such as the NHS, police, wefare, child care and education. It increases unemployment by losing jobs in government and increases the benefits bill, it slows the economy down and increases the risk of crime, health problems,lowers the skill base for the future ETC.

I know which I want and it aint the Tories.

6. At 3:08pm on 13 Apr 2010, Crookwood wrote:
'Everybody is pussy-footing around with the problems: what gives?'

The working population gives, it gives its all, creates everything that there is, everything that there ever will be.

And for the privilege of doing so, gets bled dry in interest payments, to banks, to credit card companies, to loan sharks, and finally higher taxes to service more government debt interest.

Debt slavery for the masses, that’s what gives.

Having been invited by the Conservatives and "call me Dave in particular" to join the government, I wonder what position I should accept, that will of course depend on the salary and the perks that I will be able to enjoy, foreign travel, free food, dry stone walling a duck house a moat etc etc.
Battersea power station was used by Pink Floyd on their ANIMALS album cover "Pigs on the wing "???

7. At 3:20pm on 13 Apr 2010, Paul Noakes wrote:

"At last we can see the main difference. A massively expensive overpaid and inefficient public sector (labour) or more self determination and a much smaller public sector (tory). Hooray now all we need is for the public secor pension time bomb to be defused!
Time for Brown to go "

A simple analysis for simple voters - which is why politicians all talk in sound bytes and why they treat the electorate as idiots.

In this new world of 'self-determination' - who will regulate the banks? - will they regulate themselves perhaps?

Maybe - but for 10 points can anyone tell Paul Noakes what happened the last time that was done? - it was only the last 10 years so it shouldn't be hard.

Face facts - until the electorate can show they are not as simple to fall for soundbytes and one-line pledges and that they can handle the complicated issues - then 'small Government' is a pipe dream.

I mean some people stil think the crisis was caused by too much Government spending simply because a politician found it easier to blame the Government (who is always unpopular) than the banks (who will be their future, and probably present, employer.

7. At 3:20pm on 13 Apr 2010, Paul Noakes wrote:
Time for Brown to go
--------------------------
Better hope the polls are getting it wrong as it looks less likley by the day.

The econ(ned)omy is going to do a great job of pretending to come good over the next three weeks. Six months ago it seemed a dead cert for Cameron; no longer.

I don't have that much confidence in the Tories, they want to keep interest rates low for as long as possible for a start and are willing to manipulate the economy in order to do so. Is this wise? For all their talk of getting down private debt and 'living within our means' when it comes to the crunch they want people to forget about paying their debt down, borrow more money to buy things....and don't worry because interest rates are 0.5% so it doesn't matter, you can afford it!! They say they've changed their whole view on things financial, yet it was only 18 months ago or so that when the banks were going bust they were saying the answer to our problems was the total de-regulation of the mortgage market! Have they really changed 30 odd years of thinking just like that? Trust Me I'm A Tory....

"we can't go on with the old model of an economy built on debt" and that "saving and business investment must replace reckless borrowing as the foundation of growth". May be what they are saying....but do they really mean it? Not if you read between the lines they don't.

Robert - you say "And the important argument is whether that proportionate boost for the private sector would enhance or diminish the prospects for growth for the economy as a whole - because only a few ideological zealots would think that what matters most is the comparative size of one or other sector, rather than the implications for future prosperity of their respective weightings."

There is one fundamental difference between the 2 sectors: the private sector is far more likely to generate wealth than the public - something that we desperately need to fix both the budget and balance of payments deficits.
The size of the public sector should reflect what we can afford and not be set at a level so to persuade people to vote for a political party. Currently and for the last few years, it has been way above what we can afford: witness the average annual budget deficit of £30 billion per year since 2000.

the taxe system is all wrong i working and i get tax on what i get each month by paye system every one should pay there taxes like that some people in this country pay less than me but are pay millons is that a fare system

Living in Johannesburg, as I do, I can't help smiling when I read the correspondence from "Party Bashers" from both sides. How I envy your debate, the real concern about your State, the ability to be able to make reasonably rational decisions, and the knowledge that come election day you'll get a result, maybe even a surprising one. You've got something priceless going for you.

The Labour party HQ unveil two manifestos. A 78 page manifesto for England that promises more for English voters than the second class 75 page manifesto for Scotland.

Some of the issues in the Scottish version of this 2010 Westminster General Election manifesto are not even within Westminsters' control?

At the Glenrothes election for a new Westminster MP the Labour party shamefully campaigned on matters that devolved Scottish Government deal with. This manifesto proves they are going to campaign in Scotland with similiar unfair tactics.

https://www.oilofscotland.org/scotlands_news.asp

There comes a point in any society were more is being taken out of it than simply being put in,its like a tree thats got branches that are rotten.At what point do you say enough is enough and rip the tree out of the ground and completly replace it?
There are so many people fiddling in the uk now that its way out of control examples being :-
1) Businesses that hire illegal foreign workers (I noticed the Tories would stop Identity cards, I guess to stop them being found out!).
2) To off shore bank accounts hiding the cash of the wealthy.
3) Benefit claiments that have two jobs and claim unemployment in different identities all over the UK.
4) Unemployed Couples that deliberatly live apart so the woman can claim she has been abandoned to get more benefit.
5) The bankers robbing everybodies pensions, life savings.
6) The MP`s and businessmen that claim massive expenses as tax offsets.
7) The outsourcing of care for the elderly to private companies owned by the doctors & solicitors so they have a nice little earner.
8) The legal aid being given to immigrants who have not paid a bean into the system yet expect to be represented.
9) The cash in hand workers and market traders that contribute nothing into the tax system.
Loads more examples but where do you start?
Need I say any more the whole system is rotten to the core, the ordinary person has no where to go other than exit the country. If they can that is because every obsticle is put in your way to prevent you leaving.
In the words of Bob Geldof its a rat trap and we have been conned Judy.

The Tories have a serious problem in that Osborne is just not credible as a Shadow Chancellor, the Chancellor's debate proved that beyond doubt. Vince Cable continues to be the only one to consistently hit the mark over the economy and if the economy can't be fixed every thing else will go to pot. To me the answer is obvious, we have to vote Lib Dem to ensure Cable is there to sort out the mess we are in.

There seems to be two lies at the heart of the economic debate.

- Labour, the lie seems to be that spending can continue for the time being and eventually growth, efficiency savings and a modest increase in the already high tax take will resolve the deficit issue.

- Conservative, the lie seems to be that a even more modest tax increase together with painless "efficiency" savings and economic growth will solve the problem. Quite where these efficency savings will come from and quite how they will be painless when so much of the economy is predicated either on the public sector directly or private industry that in turn works for the government is unclear.

The British public I would argue isn't buying either of these untruths which is why the election is still in play. There really needs to be some truth and integrity from either side. We need a clear statement on what taxes must rise and where the pain will be felt in terms of what budgets will be cut, by how much and what the implications are of those cuts in terms of jobs lost and services downgraded or cut.

We the British public are adult enough to have that conversation with the political elite. Why are the politicans and the media not giving us this open and honest debate ?

Labour is more appealing as they appear to take responsibility away from the individual - it's always someone else's fault (GB is the best practitioner of this). The last two generations have been brought up to expect that whatever they do is someone else's responsibility and the population is now comfortable being able to blame someone else whether it be bankers, politicians, the rotten foreigners etc.

This idea of the Conservatives that people want to be responsible for themselves is a mistake. Role on socialism (just communism by another name.) Come back Brown all is forgiven (We can't remember what he did wrong anyway - did he do anything wrong?) We certainly don't want anything smelling of Thatcher, that made people responsible for themselves.

Then there's tomorrow with castles in the air. My vote goes to the independents.

Conservative mantra of 'empowerment' translated equals:

Empowerment of schools = privatisation of best new schools built by Labor. Forget the rest?
Empowerment of hospitals = privatisation of the best new hospitals built by Labor. Forget the rest?

Empowerment by Conservatives ACTUALLY means ALL the American Republican companies REJECTED BY AMERICA are waiting slyly in the wings with share options potential to be owned by Conservatives?

As ALL MPS have automatic private health insurance - why would any Tory MP care about privatisation (oops, empowerment) of schools, hospitals and all essential front line services?

Furthermore, as millionaires, David Cameron and George Osborne are claiming, in full, their tax-payer paid MP salary and FULL MP allowances averaging about £159,700.00 per annum each? (TheyWorkforYou.com)

John F Kennedy did not take a salary while in the Senate or when President if the United States. JFK simply believed he was personally wealthy enough NOT to take his salary and considered it 'unethical' to take a salary from tax-payers.

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29. At 5:34pm on 13 Apr 2010, KeithRodgers wrote:

There comes a point in any society were more is being taken out of it than simply being put in,its like a tree thats got branches that are rotten.At what point do you say enough is enough and rip the tree out of the ground and completly replace it?
There are so many people fiddling in the uk now that its way out of control examples being :-
1) Businesses that hire illegal foreign workers (I noticed the Tories would stop Identity cards, I guess to stop them being found out!).
2) To off shore bank accounts hiding the cash of the wealthy.
3) Benefit claiments that have two jobs and claim unemployment in different identities all over the UK.
4) Unemployed Couples that deliberatly live apart so the woman can claim she has been abandoned to get more benefit.
......etc....

A good start on the list but as you know it's worse, far worse than your short list. For example I know of one situation where 3 and 4 are combined except that the woman claims rent from social for the flat and it his her partner, who also claims benifit whilst holding down two jobs, who owns the flat as one of his buy to rent properties.

I know at least half a dozen people fiddling the benifits system, one of whom inherited £60k recently but had to wait a couple of weeks because he wanted it in cash to put under the floorboards, otherwise he would lose his benifits. Why do I not drop a coin on these people? Because I know they are the tip of the iceburg, there are thousands, tens of thousands fiddling the benifits.

It's for the government to stop them and they could do it easily. Simply require that to recieve benifit you must turn up every weekday 8am till 5pm and while your here we will provide training. We want a load of you as babysitters so we can remove the excuss from some of the other malingerers. We want some of you as minibus drivers to get other skivers to work. In fact I have a whole list of jobs to keep you occupied. Don't want to do the hours? fine you don't get paid.

Next I'll deal with the bankers and their stupid bonuses.

29. At 5:34pm on 13 Apr 2010, KeithRodgers wrote:

....Need I say any more the whole system is rotten to the core, the ordinary person has no where to go other than exit the country. If they can that is because every obsticle is put in your way to prevent you leaving.
.....................

NO surely it's easy to leave the country for better weather and standard of living. Just move house to Jersey, or Gurnsey, or Bermuda, or Cayman Islands or .... well there is a long list of 'British' Islands protected by the armed forces you pay for but you can't just move there.

Extra Efficiency savings are possible but it takes skills and knowledge that for the most part are not in good supply in the Public Sector.
There are many examples of startling improvements being achieved using Lean Processes, Value Management & Value Analysis, Six Sigma and Total Quality Management. If Cameron is serious then spend some (modest) money on training 5,000 - 10,000 public sector managers to give them the tools to deliver more for less.

Tory words and deeds, starting with the title of the Conservative Manifesto: "An Invitation to Join the Government of Britain" – I thought there was a Government previously. I thought it was called Labour.
The Conservatives portray Labour as a "bigger" government, which makes decisions on behalf of the people. The Conservatives contrast themselves with this; the Conservatives will enable citizens to make their own decisions. I'm not sure how this will happen without some anarchy, but I'm practically sure there will be some rules & regulations about this here decision-making down the line, after the election but before the citizens start ruling themselves.
Yet it is this very idea - individual citizens making their own decisiuons - that "drives the Conservative party.” You’d think there’d be a huge-big write-up about it, especially because Cameron seems to know that this central idea has moved the party towards the center, away from the right and away from the political legacy of Margaret Thatcher. Are you still with me? Good, because there's plenty that get lost right about now...
Cameron outlines his vision of a "big society" vs. "big state". Apparently in a big society, you can "Be your own boss. Sack your MP. Choose your own school or change your own school. Own your own home. Veto high council tax rises. Save your local post office. Vote for your own police commissioner. See how government spends your money, which it doesn't really spend because you make all the decisions."
But, Mr. Cameron, Sir, I'm just a little citizen carrying out my little job which takes me about 10 hours/day...So, Mr. Cameron, sir, I don't think I'll have the time to do yours. Didn't I cast my vote for you so that you would make political decisions?
Cameron also struck a traditional note when he said that "real growth (in the economy) will only come when we get the private sector going." There's a brilliant satatement; I just wish it had been followed by another brilliant statemnt that explained the methodology.
In answer to your question: Do Tory deeds match their words, How does one tell? You can't follow the words to completion because the ending seems never to be there...Anyway, the Conservatives aren't in power yet.

On immigration, the Conservatives vow to have an annual limit on the number of non-European Union economic migrants and to make foreign students pay a bond on entering the country that would be repaid when they left.
What if the skilled migrants want to come from the United States or Canada or Australia? Is that one of my decisions and should I say no?
What if the foreign students never intend to leave the UK, but plan to blow up Parliament. Should I let them in, show them what a great country we have so maybe they'll change their minds?

The Conservative Manifesto is a donut. In the centre is nothing and where there is nothing there should be details about how the party will accomplish what it says it will accomplish.

In todays Tory manifesto we hear about a protected NHS, defence and some foreign aid spending, whilst promising not to reduce fuel allowances or pensions, offered tax breaks to the wealthy, married couples and business. I'm still no clearer to knowing who he is actually asking to make sacrifices to reduce the deficit?

As we are "In this together" to squash the deficit maybe he should persuade some of the non-doms to help

I wonder if proportional representation is the way to go , with the first past the post system kicked into touch?
Surely it should go on the number of votes cast for each party.
Another thing I no longer reside in the UK yet I am still allowed to vote because I hold a UK/ European passport. Anybody not having residence in the UK should not be allowed to vote in the election!
I can understand armed forces etc, but no permanent residence no vote!
How many people or categories of people vote but never actually live in the UK?

37. At 7:55pm on 13 Apr 2010, Uphios wrote:
Yes your right there is a certain class of person that by virtue of having lots of cash can virtually buy there way into any country on the guise of setting up a business.
Or being lucky enough to have a lump sum that allows them access but to the normal rank and file this option is not open to them.
It will be interesting to see what each party will be doing to close down the tax havens and stop wealthy people off shoring there cash.

29. KeithRodgers

I could leave the country easily, I have had the opportunity several times in the past. Highly skilled, highly educated, all the things that other countries value. I'm not going anywhere because, apparently unlike you, I want to do my best for myself here and, in some small way, repay the country that made it possible for me to be highly skilled and highly educated.

36. Uphois said
>>
For example I know of one situation where 3 and 4 are combined except that the woman claims rent from social for the flat and it his her partner, who also claims benifit whilst holding down two jobs, who owns the flat as one of his buy to rent properties
>>

Justified not "dropping the coin" because this is just the tip of the iceberg.

"It's up to the Government to stop it..."

You think the country is full of scroungers and tax evaders but you won't do anything about it. If they are evading tax you can line up a reward for yourself. If they are fiddling the benefits then you can save the money for someone more deserving.

Claiming there are scroungers making hay on benefits is a popular Right of centre position. Taking personal responsibility is another one.

You could put the two together.

Off course their deeds won't. Its the same old hot air from baby faced tories. There are too many poor people and public sector workers for the tories to win. Sadly the only other contender is Labour, so its bankruptcy for the uk. Maybe then people will vote with their hearts.

43. At 9:50pm on 13 Apr 2010, willow_too wrote:


You think the country is full of scroungers and tax evaders but you won't do anything about it. If they are evading tax you can line up a reward for yourself. If they are fiddling the benefits then you can save the money for someone more deserving.

Claiming there are scroungers making hay on benefits is a popular Right of centre position. Taking personal responsibility is another one.

You could put the two together.
.....................................

Your right, I could. But I already knew that. I appreciate that you may be happy to stab friends, acquaintences or family in the back but I'm afraid that's just not me.

Like I said, easy for a government to fix but none want to lose the vote of these leaches.

Unless any of the parties crack down upon social security abuse, immigration abuse and tax loophole abuse, we will continue to have a leaking bucket with large holes, and less water coming in than going out.

Sometimes the fraudsters live on council estates and are claiming benefit etc, before anybody fires e mails at me I am one guy that thro` hard work and sacrifice educated myself and pulled myself out of poverty.
The other point is this sometimes the fraudsters and tax dodgers wear suites and live in posh houses, they ridicule the poor people mentioned above but they are no better.
The fraud they commit is on a much bigger scale though,off shore bank accounts, shutting up shop on the business and raiding the pension fund, insider dealing on trading shares, dodgy expenses claims etc.
No question the cash bail out to the banks(mega billions)is going to be paid for in public sector job cuts. So we have the taxpayers being caught two ways (note I mention the taxpayer not the tax avoider).
And they call the UK a democracy dont make me laugh.

Empowerment to the banking sector = Corruption and Excess.

Have they learn't nothing?

People have too many rights thess days and many cannot be trusted, I want to see a goverment with a communist approach to benefits/state employees/fraudsters and prison and a democratic approach to business and Joe average with limits this time around.

#45 Uphios

You describe your "friends, acquaintances or family" as "leaches", but you won't do anything about the very behaviour you decry.

The reality of trying to persuade a "broken" society to fix itself is all too predictable. The areas with mostly motivated, employed, articulate people will gain ever more advantage. In the less advantaged areas more effort is needed to make a difference and there will be fewer people willing and able to do it.

Back on the point of the column, a deeply worrying message is coming through on capital allowances. There seems a quite clear signal that a low rate of business tax is desirable at the expense of capital investment. This will be redistributive, from future wealth creating sectors towards private equity funds and financial services.

Should interest rates be held low for a long period then this can only serve to further erode savings ratios and this, in turn, will reduce funds available for investment.

There is nothing in this that is transformative of the structural weakness of the economy. If the UK is to be a modern European economy comparable with the likes of the Nordic or Germanic nations then the base of the economy must be wider and deeper.

These measures will only serve to narrow the base, more reliance on the financial sector should hardly be a policy objective.

Hopefully in the leader debates the growing areas of differences in economic policy will be fleshed out some more. Developing policy differences beyond the deficit&debt vs. stimulus argument to include national innovation systems could become an interesting party divergence (redefining comparative advantage, picking the next winner as the national specialism after dropping finance, hmmm?)
Personally I look forward to seeing an expansion in the Labour-Conservative debate on macro to include countercyclic policies beyond CPI targets and fiscal policy (e.g. high mortgage deposit requirements in boom, low in bust). I'd also like to see more on accountability e.g. (i) resolution of the West Loathian question, (ii) automatic fiscal tightening (Poland) or vote deduction if 50% debt levels exceeded. On efficiency* and innovation in the public sector I would like to see an alignment of incentives e.g. higher income tax / lower bonuses for public sector workers when deficit and average sector salary are high, lower income tax / higher bonuses when deficit is high (comment 8 at www.prospectmagazine.co.uk/2010/03/how-to-really-save-100bn). I guess I would also like to see fiscal drag diffused by smoothing tax schedules; why have thresholds when when we have spreadsheets and formulae? I'd also like to hear all sides of the argument on the meaning of “fair”; why should (income) tax rates rise monotonically, why can't the percentage or even absolute amount of tax be non-monotonic, a “fair” balance of redistribution and incentive?
*Aside – I agree with Janner (post number 38) that there are many techniques that can lead to efficiency improvement, these are particularly needed after periods of change/investment/growth, some may say that even Toyota have recently succumbed to too much too soon. Nevertheless the techniques mentioned in 38 are incomplete; with good descriptive models you don't need to always do statistical analysis, a value stream map is good for where you are but you still need to be careful about where you are going etc. The required descriptive models are developed to a good extent in manufacturing science (see e.g. the textbook 'Factory Physics'), but I suspect less so in services. Optimistically it could be argued that this means that not only is there room to move an incentivised public sector onto the efficient frontier, but the frontier can be moved as well, pessimistically it could mean it is just too hard. Given the 'Management Today' article (www.managementtoday.co.uk/channel/Finance/news/992252/how-trim-fat-uks-bloated-public-sector) I am optimistic, as long as a mechanism for driving efficiency and innovation can be found (not league tables) then the techniques will follow.

At their heart, the Tories are a selfish, narrow-minded, vindictive , bigoted group of corrupt bores who will ultimately bring Britain to its knees in misery and retribution.
And if England votes for them it will deserve what it gets.

On a technical note the statements : “we can't go on with the old model of an economy built on debt - saving and business investment must replace reckless borrowing as the foundation of growth" just don’t make any sense :
The economy is built on debt full stop. If a business wants to build a factory – ‘to Invest’ then the business takes out a ‘debt’ owed to a bank of say £1 million.
Debit Loan A/C £1 Million
Credit Current A/C £1 Million
The business then pays £1 million to workers who then become the Savers in the stupid S=I formula (Savings = Investment). These savers can then buy goods in the shops and the shops the get the money can pay their debts off with. But When the factory starts producing goods, the goods will include part of the price of the factory. Unless someone somewhere takes out more debt to pay for this we will have a recession – dumb system eh ? a better solution is to use NEFS.
(Should the factory be paid for with ‘old money’ then this will make the situation even worse as whoever has this ‘old money’ was paid to make something that had a price. Instead of using this money to liquidate a price it is used to create a new price this creates a further divergence between the money in consumers pockets and the total prices in the shops.
If the statement said instead : “we can't go on with the old model of an economy built on debt – NEFS Net Export Financial Simulation must replace reckless borrowing as the foundation of the economy it would make perfect sense.

Why is all the commentary about the deficit?
There should be a parallel commentary about the National Debt.
So, the rate of growth of the National overdraft is slowing......hard to see how it could grow any faster.
Debt is still, even assuming a way above trend 3-3.5% growth, going to double to £1.4 trillion by 2015.
Nice work Gordon.
Boom, bust, readjust...It seems we are in a continaul cycle, Labour bust the books, the Tories make themselves unpopular fixing them again, Labour get re-elected...

36. At 7:47pm on 13 Apr 2010, Uphios wrote:

"I know at least half a dozen people fiddling the benifits system, one of whom inherited £60k recently but had to wait a couple of weeks because he wanted it in cash to put under the floorboards, otherwise he would lose his benifits. Why do I not drop a coin on these people? Because I know they are the tip of the iceburg, there are thousands, tens of thousands fiddling the benifits."


...or maybe because following the scandal of MP's expenses it has somewhat clouded the once clear definition between 'scroungers' and 'workers'. I don't begrudge people fiddling the benefits system when they are in need of the money (although defining need is very difficult) - but I do object to already wealthy politcians trousering vast amounts of taxpayer money to furnish their lavish lifestyles.

The enemy resides at the top - not the bottom.

#52. Glenis wrote:

"If a business wants to build a factory – ‘to Invest’ then the business takes out a ‘debt’ owed to a bank of say £1 million...."

Hmm... Most commercial businesses intend to get a return on the capital employed (many people have made whole careers out of computing this estimated rate of return required to justify the investment in the first place).

This return has to be of a sufficient size to both pay off the investors at a reasonable rate of return sufficient to entice them to invest in the first place and hopefully more so that the business (that is a commercial business - rather than a work creation scheme) can retrain capital so that it can invest in new enterprises or expanding an existing enterprise. (I'll explain the investment assessment process in more detail if you need me to.)

It worries me that politicians talk about loans as 'the' way (implying there is no other way) to grow an enterprise. I put this down to their ignorance and lack of experience in the real world of business.

42. At 9:36pm on 13 Apr 2010, KeithRodgers wrote:

"It will be interesting to see what each party will be doing to close down the tax havens and stop wealthy people off shoring there cash."

None of them - they do not wish to endanger their future employment and their own future tax evasion.

46. At 10:43pm on 13 Apr 2010, U14422164 wrote:

"Unless any of the parties crack down upon social security abuse, immigration abuse and tax loophole abuse, we will continue to have a leaking bucket with large holes, and less water coming in than going out."

We will be paying vastly more in interest to the very banks who created the deficit we took on than the total amount of benefit fraud for the last 10 years - I think your priorities are misguided due to the poor information you are receiving from your media sources.

I'm sure that if your roof had a giant hole in it you wouldn't be concentrating on fixing the dripping tap in the bathroom would you?

51. At 00:00am on 14 Apr 2010, onward-ho wrote:

"At their heart, the Tories are a selfish, narrow-minded, vindictive , bigoted group of corrupt bores who will ultimately bring Britain to its knees in misery and retribution.
And if England votes for them it will deserve what it gets."

Now I am surprised - I always had you down as a supporter of their free market principles - I must have made a mistake.

53. At 08:54am on 14 Apr 2010, hootsmon wrote:

"Boom, bust, readjust...It seems we are in a continaul cycle, Labour bust the books, the Tories make themselves unpopular fixing them again, Labour get re-elected..."

So what happened in the 80's? Did Neil Kinnock somehow ensure the Tory party brought implemented Labour economics?

It seems your theory is only 5 minutes old and already it is defunct.

Surprised little or no comment on Tory proposals to accelerate the intended raising of the age when you become entitled to State Pension. Pension deferral by just one year significantly impacts on lower and middle income individuals which would take some clawing back and mitigation of NIC has no benefit for pensioners who are not employed.

Tories are committed to a far more significant shrinkage in the relative size of the public sector, or a bigger proportionate boost for the private sector, than Labour.

I have been there with this play before in the 70's and 90's and it as cost us a lot of money with all those agencies with in government that need chief executive officers LOOK at the NHS Trusts each trust as chief executive officer and Board then there is the Local PCT on top with it's own chief executive officer so you are looking at a large number chief executive officers and paper pushers running the NHS all taking top whack salaries before you get to front line staff

This why we need to put so much money in to the NHS as most departments run as separate companies and teams of doctors run as companies with in departments with in the NHS and this was a Tory idea that as bumped up costs year on year in the NHS as each company as to have it's own set of paper pushers

#61

"Tories are committed to a far more significant shrinkage in the relative size of the public sector, or a bigger proportionate boost for the private sector, than Labour."

You're assuming that these are opposites. When public sector workers leave the public sector, they do not necessarily join the private sector; they are just as likely to join the dole queue.

The Conservatives have a good track record in increasing unemployment. This does no favours to the economy and meant that during the Thatcher years, government debt as a % of GDP actually rose by about 6% (although it obviously fluctuated during her term as PM). The Conservatives are very good at moving taxation around, but it seldom makes a difference to ordinary people.

It seems to me that taxing capital investment at a higher rate is going to negatively benefit manufacturing in the UK at a time when we need to manufacture more, not less, for export.

Nonetheless, making Britain a good place to do business is obviously a good thing for the ordinary person in the street. I just hope that the Tories can make sure that most of that benefit is to the poorer, more remote parts of our island rather than in the prosperous South East.

I'm amazed nobody's picking up on the Tory policy of taxing business investment. They will place the heaviest burden on companies that invest in this country (e.g. the remnant of our manufacturing industry), and provide a huge 3% tax break for those companies that simply drive their equipment to destruction before sacking the workforce and outsourcing production to China. This policy will lead to disaster.

Personally, I hope this clueless bunch of aristocratic buffoons gets its tail kicked into next week at the election. Yes, 5 more years of Labour will be torture, but at least they don't appear to have a plan for systematically dismantling the economy. Such a defeat would give the Tories a chance to get their act together, much as Labour did after Major's surprise election victory. Heaven knows the country is crying out for decent opposition. With the country in the state it is in, ANY opposition worth their salt would be coming into the election polling above 50%, yet the Tories can't even manage to break 40%. They are a shower.

Oh, and anyone suggesting that I'm engaging in the politics of envy by mentioning the upper-class credentials of Cameron and Osborne should consider this: if the leader of the Labour Party chose as Chancellor/shadow Chancellor someone who had been in the same Union or Marxist Club or whatever at University, would this not be considered shameless cronyism?

I doubt if David Cameron has done anywhere near enough to shake of his image as the leader of the party which supports the rich.

As things stand it looks like we are on course for a hung parliament, which is probably the best outcome. We have had coalition governments in the past and other countries run successfully using them.

Given that no one party has all the answers and given that the differences between them could act as checks and balances we might actually get a government by consensus whereby parties discard the more outlandish policies and adopt those based more on common sense which they all agree on.

It will be interesting to see how this all plays out.

Hi Guys (WOTW et al).....

It's been a while since my last post but now the election is underway (you know, that mechanism for implementation of "Democracy") I thought I'd stick my tupence worth in.....

I notice that David Camerson keeps baning on about winning votes, strange I thought as surely he would be talking about what he would do should his party be elected....?

Just goes to show what we will end up with v.soon. Anyway I'm off to climb on board the good ship LibDem, perhaps they will suck too but at least it would cause the main two to perform a separation act ;-)

GL All

63,

Good post and I have to agree with your main points.

#51 onward-ho
At their heart, Labour are a selfish, narrow-minded, vindictive , bigoted group of corrupt bores who have brought Britain to its knees in misery and retribution.
And if Britain votes for them it will deserve what it gets.

#54 wotw
"I don't begrudge people fiddling the benefits system when they are in need of the money"

Really?

Nice set of values you have there...

#54 wotw
"The enemy resides at the top - not the bottom."

Strange that you should hold such a stratified view of society, and place politicians, of all people, at the top. Maybe we should turn this on its head and say that we get the politicians behaviour that reflects wider society - lying, cheating, and an entitlement culture.

How can a thief hold a thief to account?

How can a liar condemn a liar?

How can a cheat berate a cheat?

Both ends of the spectrum need to change, not least because it's the poor excluded middle that suffers.

59. WOTW.
In 1979, the incoming Conservative government inherited an economy with inflation of 27%. Restrictive labour practice, Unions out of control....
Inherited.
Theory stands.

The central point was about the current government doubling our debt to £1.4trn. Quite an 'inheritance' for whoever 'wins' the election.

Writingsonthewall
"I don't begrudge people fiddling the benefits system when they are in need of the money"

I cannot believe my ears.

There are hard working tax paying honest people who share your view? This is lunacy. So if you are lucky enough to be comparatively well off, you rightly get lambasted for fiddling, but if you are poor, its ok, lets encourage it?

This is politics of the asylum, and no rigth minded person could possible agree with you.

Why not extend your philosphy to violent crime, robbery, sexual assault? Your argument is utter nonsense.

Writinsgonthewall
"So what happened in the 80's? Did Neil Kinnock somehow ensure the Tory party brought implemented Labour economics?"

The 80's recession was fallout from the IMF mess Labour got us into in the 70's. Just like the 2010's hardship will be as a result of the Labour profligacy in the 2000's (not exclusively, the banking crisis was half the problem, but the other half was squarely Labour's doing)

67 Percypants.


Smartypants!

58 WOTW
To help the sick and the poor and to help our country and less fortunate ones we need a thriving, global economy with entrepreneurs doing deals and tax revenues piling in.We need high wages and good incentives to earn, and with profitable companies and good safeguards for employees, investors and customers.
But that still does not make me a Tory!
And I think Labour are still the only lot who can do all of these thing at the moment.
If interest rates go up, as they always do under the Tories, it's curtains for me and most of my business-running friends.
If the public sector gets slashed,,it's curtains for most of my public sector working friends.
And if Benefits get slashed it's curtains for half of the population in Britain.
To run a compassionate society costs lots and lots of dosh, but what is the point of dosh if our society does not care for its unfortunates?

It is actually not nice to be in Britain and earning a high income at the moment.The tax is extortionate.
The reason we have such a high deficit is that the vast bulk of the working population pay rates of income tax which are far too low to bring in enough revenue.
Yes, public spending is too high, but without it the economy would have crashed.
With the Tories the economy will crash .
Basic Rate Income Tax should be 30% and the top rate 40% not the new 50%.
At 50% it is a pain in the neck to work a minute extra.
But Middle England will not vote for what actually is the only way out of this mess.
It was inevitable that the Tory low basic rate experiment would end up in a huge deficit, even though it is Labour in power, ONCE THE LOW INCOME TAX BASIC RATE GENIE GOT OUT OF THE BOTTLE THERE WAS NO PUTTING IT BACK IN.
AND UNDER THE TORIES WE ARE GOING TO SEE BANKRUPT COUNCILS AND CITIES LIKE IN AMERICA.

67. At 12:53pm on 14 Apr 2010, PercyPants wrote:

"#51 onward-ho
At their heart, Labour are a selfish, narrow-minded, vindictive , bigoted group of corrupt bores who have brought Britain to its knees in misery and retribution.
And if Britain votes for them it will deserve what it gets."

Perce - your not seriously suggesting the Tories aren't the same or worse?

All this user's posts have been removed.Why?

I am at the bottom of the pile and do not fiddle my benefit. I have not turned to any criminal activity but still feel I am only important to be included in the community and then only on May 6th. Maybe were I a banker, financier or poltician I would be given immunity from fiddling as we are supposed to revere this group of people who take expenses and fees as right . The answer is clearly staring us in the face ,but the outcome of it all will mean the status-quo remains the same, change of faces at the top with the policies giving me less hope for mine and my childrens future. I for one will still hope for a change in my circumstances but see nothing on the horizon to give me cause for celebration.

"The Tories have only one policy, I am allright jack , and pull up the ladder.