Re: How do cutbacks save economies? : Sat Oct 13, 2012 7:31 pm  

Ajw71 wrote:

It's not hard. You just stated that the NHS was in a mess when Labour came to office and required 'huge spending'.

Obviously not huge enough to avoid running at a surplus for their first full four years in office.

It may be hilarious for you, but that little statement you made has been comprehensively torn to shreds.

You will now probably turn to personal abuse, to try and save face.

Before Labour took office, the NHS was in a state where the media quite regularly splashed on stories of elderly people dying on trolleys in hospital corridors.

MRSA and c-diff infections had soared, after the numbers of cleaners had been halved in the name of profit. Because, as you know, profit is much more important than human beings.

Schools were leaking (plenty of people on this forum remember the conditions that their own children were being educated in – and have commented on it more than once).

This required action.

In many ways, it was what constituted 'the third way', since Labour had ditched Cluase 4 and continued down the same path economically that had been started by Margaret Thatcher and continued under John Major.

When the financial crisis occurred in 2008, it was not a result of public spending, but of the appalling and irresponsibly behaviour of banks on a global basis.

And before the crisis, and the bailing out of the banks, the deficit was actually less (albeit by a small amount) than the level when Labour took office – but with schools and the health service in considerably better condition.

Labour, while very happy to allow people to believe that it had spent record levels on public services had, in reality, done no such thing (see Prof Colin Talbot, Manchester University, for full data on public spending over the last 200 years).

Re: How do cutbacks save economies? : Sat Oct 13, 2012 7:34 pm  

Ajw71 wrote:

It's not hard. You just stated that the NHS was in a mess when Labour came to office and required 'huge spending'.

Obviously not huge enough to avoid running at a surplus for their first full four years in office.

It may be hilarious for you, but that little statement you made has been comprehensively torn to shreds.

You will now probably turn to personal abuse, to try and save face.

No it hasn't, all it's done is prove you haven't a clue what you're on about. It was Labours 2nd term where they really invested in the NHS, not the first term.
In 2007 the deficit was £37.2bn (2011-12 prices). The deficit Labour inherited was £37.5bn (2011-12 prices).
In 2007 the debt was roughly half what it is now.
I wonder what happened in 2008.

Re: How do cutbacks save economies? : Sat Oct 13, 2012 7:34 pm  

Ajw71 wrote:

It's not hard. You just stated that the NHS was in a mess when Labour came to office and required 'huge spending'.

Obviously not huge enough to avoid running at a surplus for their first full four years in office.

It may be hilarious for you, but that little statement you made has been comprehensively torn to shreds.

You will now probably turn to personal abuse, to try and save face.

"Torn to shreds"?

Don't make me laugh, silly lad

Re: How do cutbacks save economies? : Sat Oct 13, 2012 7:43 pm  

Him wrote:

No it hasn't, all it's done is prove you haven't a clue what you're on about. It was Labours 2nd term where they really invested in the NHS, not the first term.
In 2007 the deficit was £37.2bn (2011-12 prices). The deficit Labour inherited was £37.5bn (2011-12 prices).
In 2007 the debt was roughly half what it is now.
I wonder what happened in 2008.

Wasn't there a bust in 2008?

Oh but I thought Gordon ended boom and bust?

Re: How do cutbacks save economies? : Sat Oct 13, 2012 7:48 pm  

Ajw71 wrote:

Wasn't there a bust in 2008?

Oh but I thought Gordon ended boom and bust?

FFS Tony Nicklinson could've presented a more intelligent and coherent argument

Re: How do cutbacks save economies? : Sat Oct 13, 2012 7:53 pm  

cod'ead wrote:

FFS Tony Nicklinson could've presented a more intelligent and coherent argument

Classy....

Re: How do cutbacks save economies? : Sat Oct 13, 2012 8:08 pm  

Ajw71 wrote:

Thanks for this, but how is it relevant to why Labour ran up a deficit in boom years?

I think others have explained it perfectly well, lets not go around in circles, you either want to listen and learn or you swallow the propaganda that others are quite apparently feeding you, the choice is yours.

Where did you get fed all of this stuff from anyway ?

You're not Cecil Parkinsons "love child" are you ?

Re: How do cutbacks save economies? : Sat Oct 13, 2012 8:27 pm  

Ajw71 wrote:

Classy....

And factually correct

Re: How do cutbacks save economies? : Sat Oct 13, 2012 8:27 pm  

You can see the annual deficit figures in the Treasury pocket databank http://www.hm-treasury.gov.uk/d/pdb.pdf Look at the table on the bottom half of p14. The key columns to note are the second (net borrowing) and fourth (net public sector debt) as a percentage of GDP. The net borrowing column is actually given as net surplus, so deficits have a minus sign. As you will see the figures in John Major's government were: 1991/92 -2.9% 1992/93 -6.4% 1993/94 -7.7% 1994/95 -6.5% 1995/96 -5.2% 1996/97 -3.7% In Tony Blair's government: 1997/98 -1.9% 1998/99 +0.1% 1999/00 +1.3% 2000/01 +3.9% 2001/02 +0.7% 2002/03 -1.8% 2003/04 -3.0% 2004/05 -3.1% 2005/06 -3.3% 2006/07 -2.4% In Gordon Brown's government: 2007/08 -2.5% 2008/09 -4.9% 2009/10 -10.9% In David Cameron's government: 2010/11 -9.9% 2011/12 -8.1% The spike in deficit is driven by what happened between 2008 and 2010, ie the financial crisis. The deficits being run under the last Conservative government were much higher than what was being run by the Labour government up to the crisis, the deficit going into the financial crisis in 2008 was 2.5% of GDP compared to a deficit of 3.7% that they had inherited in 1997. For 7 of the 13 years Labour were in office they ran either surpluses or smaller deficits than at any time during John Major's government. The idea that is pushed by the Tories that "Labour spent too much leading up to the crisis" just does not add up. Their spending levels were much more sustainable than the spending levels of the last Conservative government. It is true that Labour spent much more on public services, because the Conservatives high deficit levels were not because of high spending on public services but because unemployment was so high then, so they had fewer people contributing tax and more people claiming benefits. The Conservatives were paying for a high bill of social failure. When Labour came in and unemployment fell (despite bringing in the minimum wage) the public finances got much better. The same would happen if we returned to a growing economy now and got back on top of unemployment. The deficit melts away when you approach full employment. When you have high unemployment you will always have a deficit no matter how much 'austerity' you have, we had 17 years of Tory austerity and cuts and we were still running high deficits in their final years in office! One more point of interest, George Osborne's Fiscal Mandate is that by 2015 the "current budget" should be in balance. The current budget is the left hand column in that table. This is where you disregard anything classed as "investment spending", eg when the government builds a hospital that counts as investment spend, when it pays doctors and nurses that counts as current spend. The Office for Budget Responsibility are going to release figures soon that are expected to say they forecast he will miss that target. However we were pretty much on that target in 2007/08, the current budget was in deficit of just 0.7% of GDP, rising to 7.2% by 2010 due to the financial crisis. So again this idea that we were spending unsustainably leading up to the financial crisis does not add up, Osborne would love to have a current budget deficit of 0.7% by 2015.

You can see the annual deficit figures in the Treasury pocket databank http://www.hm-treasury.gov.uk/d/pdb.pdf Look at the table on the bottom half of p14. The key columns to note are the second (net borrowing) and fourth (net public sector debt) as a percentage of GDP. The net borrowing column is actually given as net surplus, so deficits have a minus sign. As you will see the figures in John Major's government were: 1991/92 -2.9% 1992/93 -6.4% 1993/94 -7.7% 1994/95 -6.5% 1995/96 -5.2% 1996/97 -3.7% In Tony Blair's government: 1997/98 -1.9% 1998/99 +0.1% 1999/00 +1.3% 2000/01 +3.9% 2001/02 +0.7% 2002/03 -1.8% 2003/04 -3.0% 2004/05 -3.1% 2005/06 -3.3% 2006/07 -2.4% In Gordon Brown's government: 2007/08 -2.5% 2008/09 -4.9% 2009/10 -10.9% In David Cameron's government: 2010/11 -9.9% 2011/12 -8.1% The spike in deficit is driven by what happened between 2008 and 2010, ie the financial crisis. The deficits being run under the last Conservative government were much higher than what was being run by the Labour government up to the crisis, the deficit going into the financial crisis in 2008 was 2.5% of GDP compared to a deficit of 3.7% that they had inherited in 1997. For 7 of the 13 years Labour were in office they ran either surpluses or smaller deficits than at any time during John Major's government. The idea that is pushed by the Tories that "Labour spent too much leading up to the crisis" just does not add up. Their spending levels were much more sustainable than the spending levels of the last Conservative government. It is true that Labour spent much more on public services, because the Conservatives high deficit levels were not because of high spending on public services but because unemployment was so high then, so they had fewer people contributing tax and more people claiming benefits. The Conservatives were paying for a high bill of social failure. When Labour came in and unemployment fell (despite bringing in the minimum wage) the public finances got much better. The same would happen if we returned to a growing economy now and got back on top of unemployment. The deficit melts away when you approach full employment. When you have high unemployment you will always have a deficit no matter how much 'austerity' you have, we had 17 years of Tory austerity and cuts and we were still running high deficits in their final years in office! One more point of interest, George Osborne's Fiscal Mandate is that by 2015 the "current budget" should be in balance. The current budget is the left hand column in that table. This is where you disregard anything classed as "investment spending", eg when the government builds a hospital that counts as investment spend, when it pays doctors and nurses that counts as current spend. The Office for Budget Responsibility are going to release figures soon that are expected to say they forecast he will miss that target. However we were pretty much on that target in 2007/08, the current budget was in deficit of just 0.7% of GDP, rising to 7.2% by 2010 due to the financial crisis. So again this idea that we were spending unsustainably leading up to the financial crisis does not add up, Osborne would love to have a current budget deficit of 0.7% by 2015.

Re: How do cutbacks save economies? : Sat Oct 13, 2012 8:35 pm  

Ajw71 wrote:

Wasn't there a bust in 2008?

Oh but I thought Gordon ended boom and bust?

So are you now admitting you were wrong to say that Labour built up a huge deficit through public spending in the boom years?