Prosperity not austerity

Hong Kong is in recession. Germany probably is in recession. Italy was in recession last year and still performing weakly.  The US and Chinese economies have slowed. It is time for a UK stimulus to boost our economy.

The government is right to increase spending on schools and hospitals. It also needs to provide some tax cuts for all to increase take home pay, make it cheaper to buy a home and a car and take VAT off items like female hygiene products, home insulation, and other ways of improving home fuel efficiency.

The UK economy has been slowed by the world background and by its own tight monetary and fiscal policies. It’s time to relax sensibly. The aim should be prosperity for the many, with more and better paid jobs.

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129 Comments

  1. Lifelogic
    Posted October 31, 2019 at 9:57 am | Permalink

    It is the private sector than need the boost (with large tax and red tape/regulation cuts) not the bloated and hugely inefficient state sector (that does all the regulating and inconveniencing). State sector workers are already remunerated at about 150% of the private sector on average (when pensions are taken into account). Yet they produce so little of any real value.

    £50K of student debt for millions (and three years loss of earnings) for a worthless degree in Gender Studies, Philosophy & Media Studies from the University of Bognor Regis or similar.

    Another new tax it seems we are to be charges for not fitting a smart meter!

    • Lifelogic
      Posted October 31, 2019 at 5:53 pm | Permalink

      Smart meters are an EU requirement, so ditch them unless unless the supply companies and customers actually want them. Get the government lunacy out of it.

      • Mark
        Posted October 31, 2019 at 6:47 pm | Permalink

        They are not an EU requirement. Merely a recommendation. The Germans opted not to install them.

        • cornishstu
          Posted October 31, 2019 at 8:54 pm | Permalink
          • Mark
            Posted October 31, 2019 at 9:46 pm | Permalink

            The directive states

            (55)

            It should be possible to base the introduction of intelligent metering systems on an economic assessment. Should that assessment conclude that the introduction of such metering systems is economically reasonable and cost-effective only for consumers with a certain amount of electricity consumption, Member States should be able to take this into account when implementing intelligent metering systems.

            It also says

            The Member States, or any competent authority they designate, shall ensure the interoperability of those metering systems to be implemented within their territories and shall have due regard to the use of appropriate standards and best practice and the importance of the development of the internal market in electricity.

            which the government/OFGEM has patently failed to do.

          • Nick
            Posted November 1, 2019 at 5:38 pm | Permalink

            Apologies for butting in here but the inportant bit is ‘interoperability in the internal market’ – they mean the Europe as a whole, to bring the energy distribution mechanisms under their umbrella, not to be customer to supplier entities but state controlled.

      • steve
        Posted October 31, 2019 at 7:40 pm | Permalink

        Lifelogic.

        “Smart meters are an EU requirement”

        Thought as much. Well the EU can go whistle, they won’t be having any influence over what goes on at my property.

        Mind you, I’m not dependant on gas or grid electric and what little of those I do use from time to time is on key meters, so I don’t know how they intend to get around that.

        Probably threaten to disconnect if I don’t comply……disconnect then, see if I care.

        • margaret howard
          Posted October 31, 2019 at 11:03 pm | Permalink

          steve

          “Mind you, I’m not dependant on gas or grid electric…”

          Hot air most likely.

          • Edward2
            Posted November 1, 2019 at 8:06 am | Permalink

            Margaret.
            Is that meant to be a post which adds something to the article by Sir John?

          • steve
            Posted November 1, 2019 at 9:36 pm | Permalink

            Edward2

            “Margaret –
            Is that meant to be a post which adds something to the article by Sir John?”

            Actually Edward it’s a decomposition product of envious ideology, guff basically.

  2. Martin in Cardiff
    Posted October 31, 2019 at 10:03 am | Permalink

    Conservative governments have replaced a post-war economy where confidence was based on high employment and job security with one where it is determined by lax credit, secured against residential property inflation.

    While that happened, they increase the precarity of employees, by attacks on their means of defending terms, on trade unions, access lo legal aid and to tribunals etc.

    When the precaritised workforce run into the buffers as far as servicing debt is concerned, then throwing yet more borrowing at them is not likely to help very much.

    Here’s a radical suggestion.

    How about improving the standing of employees as against their employers in law?

    • Hope
      Posted October 31, 2019 at 1:17 pm | Permalink

      Spending in schools and hospitals not the answer to a better service, we have seen the sa,e with wasteful local authorities. 1997, Blaire said education education. More money nothing achieved so he dropped the grades to make it look standards improved!

      Tory Mass immigration policy has forced the decay of our public services to atrocious levels. Immigration targets dropped. Balancing the deficit dropped, tax cuts dropped. Mayhab’s deal dead, Johnson now promotes it! Hammond deliberately made cars expensive for consumers you wrote the same on this site. Climate Change Act makes energy very expensive, Cameron warned of “RedEd” to get elected then Mayhab built on Milibands energy policy! Come on JR at least be reasonable and take some responsibility for your govt failures that you talk about. These were manifest promises to get elected then dropped!

      Tax cuts for middle classes announced by Johnson in his bid to be PM, now dropped. VAT in N.Ireland will match RoI under Johnson’s Servitude Treaty making goods much more expensive for people in N.Ireland- different taxes for different parts of our country.

    • libertarian
      Posted October 31, 2019 at 1:22 pm | Permalink

      Martin in Cardiff

      Heres a radical suggestion , how about joining us in the real world where the last two Conservative governments have introduced even more employee centred legislation and things like you know, The equality act, the disability act , the anti blacklist act, the national minimum wage act 2011, the agency workers act, 2011 freedom of worker movement act, the 2012 Employment tribunals amendment that increased the maximum payout to a worker from £10k to £20k the 2014 Flexible working rights act, paternity leave and workplace pensions, whilst having the highest number of people in work ever recorded in the UK

      Here in the 21st century the technological innovations and ability to work flexibly that this has bought aided to a rate of change unprecedented in human history has rendered so called “job security” a thing of the past. What we have now is career security

      ps You haven’t a clue about employment laws, the UK’s are far more stringent than most of the EU

      What is it with socialists who live 100 years in the past ?

      • hefner
        Posted November 1, 2019 at 9:49 am | Permalink

        What are you talking about, man? Career security? This might be true for someone with some actual specific skills, either manual or intellectual. I doubt very much and I hope you will contradict me with proper references that a carer, a supply teacher, or people coming out of compulsory education without a diploma of some sort has much career security. I guess you must be living in your own little world of “business people”, those who keep themselves “busy” by managing other people without realising that people on zero hour contracts or assimilated do not have a career security.
        I am looking forward to you providing your list of statistics.

        • Edward2
          Posted November 2, 2019 at 11:38 am | Permalink

          Over 700,000 unfilled vacancies.
          And those are just the publicly advertised ones.
          The construction industry and IT industry desperate for staff.
          Unemployment low, record numbers in work.
          Wages rising.
          The point at which you start to pay tax increasing.
          Yet you are your usual carping pessimistic self Hefner.

          • hefner
            Posted November 2, 2019 at 9:07 pm | Permalink

            Well the coming statement might not be politically correct, but I doubt that those carers and supply teachers, mainly women, would be so interested by the construction industry. And I would think the IT industry, desperate for staff, would prefer recruiting people with a minimum of IT knowledge.
            So I am now sure that my view is pessimistic, maybe too realistic for your kind of “captains of industry”.

    • Edward2
      Posted October 31, 2019 at 1:24 pm | Permalink

      You are it seems too young to remember the mass unemployment in the 1970s under Labour.
      When standards of living for those in work fell because of incresing taxes and high inflation.
      Now we have record numbers in work and low unemployment.

      • Martin in Cardiff
        Posted October 31, 2019 at 3:30 pm | Permalink

        No, if unemployment were measured by the same criterions as in the 1970s – which I remember very well – then it would be about eleven million, recent analysis shows.

        • Narrow Shoulders
          Posted October 31, 2019 at 8:47 pm | Permalink

          Citation please.

          I would be happy to quote those statistics if true.

        • margaret howard
          Posted October 31, 2019 at 11:15 pm | Permalink

          Martin

          “then it would be about eleven million, recent analysis shows.”

          The same government dishonesty is evident in youth unemployment figures when students are registered as being in full time employment.

          • Edward2
            Posted November 1, 2019 at 8:09 am | Permalink

            If they are students then plainly they cannot work full time as well.

        • Edward2
          Posted November 1, 2019 at 1:04 am | Permalink

          That’s not correct.
          11 million…hilarious nonsense.

        • libertarian
          Posted November 2, 2019 at 9:16 pm | Permalink

          Martin

          Total an utter garbage. We have used the ILO standard for measuring unemployment since 1970
          In mid 1970’s there were 1.5 million unemployed at 5.4% The working age population in 1975 was 31 million

          The current working age population is 34.3 million and currently 32 million are in work ( 11 million, crying with laughter at you two ) there are 1.3 million unemployed a rate of 3.8%

          Maggie

          The government doesn’t collect the statistics its done by an independent organisation based on the international standard ILO and its done by the Labour Force Survey

          Students ARE NOT registered as being in employment unless they have a job as well

          Good grief you people are dim

    • Know-Dice
      Posted October 31, 2019 at 1:44 pm | Permalink

      MiC – you need to get the balance right, otherwise employers will just go off shore.

      Remember Transit from Southampton and JLR to Romania all finance by the EU…

      • Martin in Cardiff
        Posted October 31, 2019 at 3:32 pm | Permalink

        They haven’t gone offshore in Germany have they? Maybe it’s because the Germans want to attract better employers?

        • Edward2
          Posted November 2, 2019 at 11:39 am | Permalink

          Yes Germany has.
          Mainly to China.

        • libertarian
          Posted November 2, 2019 at 8:52 pm | Permalink

          Martin in C

          “Germany hasn’t gone offshore”

          Ha ha ha ha BMW, Seimens, VW, Mercedes , BASF , Bosch etc etc

          Handelsblatt

          Chinese take away another German firm,
          Berlin is increasingly worried about Chinese firms buying up German companies and know-how.

          Eon, Germany’s biggest utility by market capitalisation, is also slashing investment at home and focusing overseas, in Brazil and Turkey.

          From the FT
          “German companies look overseas as home opportunities fade”

          Honestly Martin why keep posting stuff you know the square root of nothing about ?

    • steve
      Posted October 31, 2019 at 3:06 pm | Permalink

      MiC

      “How about improving the standing of employees against their employers in law?”

      Why not go one further and encourage employees to hate their employers? Encourage them to strike as well.

      Why not….remove all wealth from employers and give it to the employees ?

      Jeez !

      My employer has a lot more money than me, he drives a very expensive car, but you know what?…..I couldn’t give a toss. He doesn’t ‘have’ to employ me, but he does and he pays me enough to settle my bills and have a bit left over. So as far as I’m concerned good luck to the bloke he is honouring his contract with me can have as much wealth as he likes.

      Your left wing ideology is seriously flawed. In simple terms; you declare war on employers and they will simple go elsewhere, who can blame them. Result = jobs gone, clever or what.

      • hefner
        Posted November 1, 2019 at 10:19 am | Permalink

        Steve, Have you ever consulted for Stockholm syndrome?

        • steve
          Posted November 1, 2019 at 9:25 pm | Permalink

          hefner

          I have no need to, since I am not held captive.

    • Fred H
      Posted October 31, 2019 at 7:50 pm | Permalink

      Marty . . . .job security as in endless UK strikes? Are you under 40 – so have no idea of the industrial strife we went through as certain industries ran out of raw material ( in the ground), failed to invest in modern equipment, continued to produce faulty badly designed and made products.

  3. Ian Wragg
    Posted October 31, 2019 at 10:10 am | Permalink

    But we’re still in the EU and subject to ECJ ruling. This is set to continue with the WA for many years. Don’t forget aboug the level playing field where we promise not to enter into competition with the EU.
    It’s all there for the voters to study but I’m sure one of the other parties will point it out.
    Good to see the serial remainers jumping ship in their scores.
    The swamp must be drained.

    • Chris
      Posted October 31, 2019 at 12:58 pm | Permalink

      These are key points in the WA, Ian, which Boris supporters seem ignorant of. His tweaked May WA is BRINO. He should fight the election on true Brexit and not the betrayal that his BRINO is. I seriously do not think that a meaningful victory for Boris is assured, but a change in stance, with cooperation with Nigel Farage and the Brexit Party, could turn all that around.

      • steve
        Posted October 31, 2019 at 2:21 pm | Permalink

        Chris

        Indeed…..Boris should have accepted Mr Farage’s offer. That would have banged Labour and the rest of the sell out mob to rights.

        I suspect Boris will come to regret his decision to refuse pact with Mr Farage. However as I understand it Parliament is not yet actually dissolved, so presumably there is still time to forge an alliance.

      • Bob
        Posted October 31, 2019 at 8:58 pm | Permalink

        We will not have control of our money or our borders for at least another three years during an extendable transition period likely to last until December 2022, and there is no guarantee of regaining our sovereignty after that.

        It is a classic bait-and-switch. The mainstream media and Lib/Lab/Con machine are working together to persuade Brexiteers to buy Boris’s Brexit-In-Name-Only treaty.

    • Bob
      Posted October 31, 2019 at 8:58 pm | Permalink

      We will not have control of our money or our borders for at least another three years during an extendable transition period likely to last until December 2022, and there is no guarantee of regaining our sovereignty after that.

      It is a classic bait-and-switch. The mainstream media and Lib/Lab/Con machine are working together to persuade Brexiteers to buy Boris’s Brexit-In-Name-Only treaty.

  4. nhsgp
    Posted October 31, 2019 at 10:34 am | Permalink

    220 bn a year going on the state debts.
    13,000 bn owed rising at 20% per year, year after year after year…..
    You have no choice. It’s austerity and only austerity.
    You shouldn’t have hidden those big debts off the books

  5. Mark B
    Posted October 31, 2019 at 10:37 am | Permalink

    Good morning – again.

    Spend, spend, spend !

    And where is all this money going to come from ? Taxation ? Borrowing ? Cuts elsewhere ? Or a combination ? Or are we going to print more money and so devalue Sterling more and further impoversing ourselves ?

    Buy votes with with the voters own money is not serious politics. One thing that has become clear is that we need political reform. We need to look at the HoL and now even the Judiciary. We need to look at the powers of the Monarch, the Speaker and the PM. We also need to look at MP’s and their total contempt of the electorate when they decide to cross the floor of the house.

    The various parties should stop playing at Santa Clause as the job is already filled.

    • steve
      Posted October 31, 2019 at 2:14 pm | Permalink

      Mark B

      “We need to look at the powers of the Monarch”

      Might as well take them off her as she doesn’t use them. If she did, we wouldn’t be in this mess now, Bercow would have been dishonourably discharged, and we’d have been out of the EU.

      One of my core beliefs is that if people refuse to accept responsibility, it should be taken away.

      • Mark B
        Posted October 31, 2019 at 2:53 pm | Permalink

        One of my core beliefs is that if people refuse to accept responsibility, it should be taken away.

        Mine too ! And yes, her grandfather would have stepped in long ago, as he once did.

      • piglet
        Posted October 31, 2019 at 3:30 pm | Permalink

        Totally agree.

      • Martin in Cardiff
        Posted October 31, 2019 at 4:54 pm | Permalink

        Only Parliament can dismiss the Speaker.

        • steve
          Posted October 31, 2019 at 6:50 pm | Permalink

          Wrong. Her Majesty can dismiss any of them including the speaker. Just she chooses not to.

        • Fred H
          Posted October 31, 2019 at 7:51 pm | Permalink

          Marty …shows us how rotten the Parliament was !

    • hefner
      Posted November 1, 2019 at 9:31 am | Permalink

      Ask LL, he knows a lot about Magic Money Trees.

  6. Henry Carter
    Posted October 31, 2019 at 10:45 am | Permalink

    Terrible thing, austerity. Now, which political party made it the centrepiece of its political strategy ever since 2010? the Conservative party! You think we forget that?

    Reply Austerity was a tri party policy, starting with Labour in 2008 with the EU deficit controls which led them to make bug cuts in spending

    • Sue Doughty
      Posted October 31, 2019 at 12:38 pm | Permalink

      It was Prime Minister Gordon Brown that was told in the streets of a Labour area, “We got no money!”

  7. Zorro
    Posted October 31, 2019 at 10:55 am | Permalink

    Absolutely JR, and we could have turned off the tap tomorrow and spent all our money here rather than giving it to the EU for them to decide what fraction we can have back…. Alas, Boris ‘die in a ditch’ Johnson has decided not to do so, and would rather submit to further EU administration over the next two years in the hope of getting a deal whilst they do everything they can to load the dice against us. Very disappointing…. ‘The Saj’ has also missed an opportunity to propose some imaginative policies at the Treasury to help promote this growth. Is it really too much to ask? The manifesto will be really important on how the PM conducts further negotiations with the EU. It will be the deciding factor as to whether the tories get a majority….

    Zorro

    • Everhopeful
      Posted October 31, 2019 at 3:49 pm | Permalink

      Tsk! Tsk! Pay attention!
      Not Christians being eaten by lions anymore…err I mean Brexit,
      Now it’s the ELECTION! Or is it the DEFLECTION?
      Not naked maidens ( about to be chomped up) in a golden barge towed by swimming hippopotami but….
      Who’s yer money on … Liblabcon?? C’mon CHOOSE. Let’s see the colour of your denarii.
      Be diverted…be entertained,
      And then you won’t notice……..

    • Martin in Cardiff
      Posted October 31, 2019 at 4:58 pm | Permalink

      The total UK tax take is about six hundred billion.

      Our contributions to the European Union are about eight billion net, just over one percent of that.

      What do you mean by giving “all our money” to it?

      • steve
        Posted October 31, 2019 at 7:28 pm | Permalink

        MiC

        Ten bob is too much to give to the ungrateful EU.
        They owe us, not the other way around.

        • hefner
          Posted November 1, 2019 at 9:27 am | Permalink

          I would give the EU two pints worth of money just for the pleasure of reading you every evening. Such fun.

      • Narrow Shoulders
        Posted November 1, 2019 at 8:28 am | Permalink

        It’s generally accepted to be £12 billion net before any increases imposed which is 2%.

        We then handover another £3 billion in tariffs plus at least £3 billion in international aid money. Is 3% too much?

        More importantly what could WE do with £18,000,000,000.

        That is not a percentage. That is a lot of real money.

      • zorro
        Posted November 1, 2019 at 9:59 am | Permalink

        around 500 billion ponds over our membership…..

        zorro

  8. Everhopeful
    Posted October 31, 2019 at 11:08 am | Permalink

    Are we actually free to relax austerity?
    Wasn’t austerity imposed on us from Brussels post 2008?
    Yet again the govt took the blame ( willingly?)?
    If only we could have got out…..

    Reply We should just do it as we are meant to be leaving soon. The pro Remain parties of course would need to continue with Maastricht rules.

    • Hope
      Posted October 31, 2019 at 1:26 pm | Permalink

      JR, disgraceful specious reply. Leaving soon! You mean at 11pm tonight, don’t you? Where we were told remainers could do nothing about it!

      Whose fault is that, Cameron, May or Johnson? The Tory party is pro-remain party. Osborne stated no sensible person would want to leave the EU. He made it sound anyone thinking to leave was stupid. Cameron told us he reformed the EU. You believe him don’t you? No deal better than a bad deal, Mayhab told us, you believe her don’t you? Johnson says May’s deal was dead and he has a new deal, you believe him don’t you? If you do not why do you expect the public to believe your party one jot?

      • steve
        Posted October 31, 2019 at 3:13 pm | Permalink

        Hope

        “Whose fault is that [not leaving tonight], Cameron, May or Johnson?”

        Actually: John Bercow, Labour, Hillary Benn, Biar’s phoney court, etc, etc.

        • Lifelogic
          Posted October 31, 2019 at 6:54 pm | Permalink

          Indeed.

          • Hope
            Posted October 31, 2019 at 8:49 pm | Permalink

            No Steve, quite wrong. Although I accept they played a part. Cameron did prepare our country to leave as one of the two definitive outcomes preparing for article 50 that he promised to deliver the day after the referendum. Mayhab could have left 29/03/2019 or 12/04/2019. She chose June though she said it would before EU elections. It was clear to the most dullest Tory MP she had no intention to do so from 08/12/2017! No right minded person would sign up to the airish backstop to keep the country in the EU forever while claiming to leave. Many commentators and public made it clear. Johnson made it clear whatever remainers did they could not stop him from leaving. 175 minutes to go and we shall see, as Cummings told reporters.
            The most treacherous were not in opposition benches, they were in Cameron’s former cabinet, and later May’s tennis guests after she left office! Tory MPs. Opposition are meant to oppose and not be relied on.
            Mayhab could have made it a condition no U.K. MP negotiates or discusses with Barnier. No business would allow it.
            Steve, get real, like immigration and deficit it is the fault if the Tory govt. publicly say one thing and deliberately do the opposite putting smoke screens for blame.

          • Martin in Cardiff
            Posted October 31, 2019 at 9:05 pm | Permalink

            The offer to die in a ditch was not conditional upon failure being attributable to any particular party.

            He lied, quite simply.

          • matthu
            Posted October 31, 2019 at 9:47 pm | Permalink

            Osborne stated no sensible person would want to leave the EU. He made it sound anyone thinking to leave was stupid. Cameron told us he reformed the EU. You believe him don’t you? No deal better than a bad deal, Mayhab told us, you believe her don’t you? Johnson says May’s deal was dead and he has a new deal, you believe him don’t you? If you do not why do you expect the public to believe your party one jot?

            So true.

            Fortunately, lies not repeated by our kind host. (The one about no deal was actually true, although the person proclaiming it ended up not believing what she herself had claimed. Thank Hammond for that.)

          • steve
            Posted October 31, 2019 at 10:03 pm | Permalink

            Hope

            “publicly say one thing and deliberately do the opposite putting smoke screens for blame.”

            Labour man Blair. Need I say more ?

          • hefner
            Posted November 1, 2019 at 9:23 am | Permalink

            Steve, The question is not “Need I say more?”, it should be “Can I say more?”.

          • Fred H
            Posted November 1, 2019 at 7:21 pm | Permalink

            Marty – -you can’t seriously call such a silly remark as lying! However, it DOES show his contempt for the outrageous manoeuvring that went on to stop UK leaving as per the Electorate’s wishes.

  9. Shirley
    Posted October 31, 2019 at 11:27 am | Permalink

    Sound thoughts indeed, but very few of these aims can be achieved while ever we are under EU rule! When do we actually leave EU rule? 1 year, 3 years, never?

  10. bigneil(newercomp)
    Posted October 31, 2019 at 11:39 am | Permalink

    Germany in recession? and getting £55m a DAY from us. And once the full treachery has been accomplished – and we are sold to the EU forever – that £55m will continually go up and up. Just like the immigration figures of Third World unemployable freeloaders.

  11. Peter Wood
    Posted October 31, 2019 at 11:58 am | Permalink

    Sir John,

    As previously warned, your government has taxed and spent beyond it’s means since the last recession; you are still borrowing.
    We are now heading into another recessionary period with interest rates at/near historical lows. Where is the EFFECTIVE economic stimulus to come form?
    Negative interest rates? Cheaper to buy gold, and then where will we be.

    Reply We need a fiscal and monetary stimulus and can afford both. UK net state debt is at an acceptable level

    • Hope
      Posted October 31, 2019 at 1:32 pm | Permalink

      We were told by Osborne 80 percent cuts 20 percent tax rises, JR had to admit on this site it was not true and did not materialise. Highest taxation in forty years more than the last two Labour govts!

      Despite huge tax rises Tory party still borrowing, promising huge spending, zero carbon footprint, HS2, overseas aid, tens of billions to EU to leave for nothing in return, and yet want to claim economic competence!

      • Narrow Shoulders
        Posted October 31, 2019 at 8:55 pm | Permalink

        I remember the 80 20 promise.

        The soundbites complain about the poor bearing the load of Tory policies but in reality the true burden fell on the higher rate tax payers.

        20 80 more like

        • Hope
          Posted November 1, 2019 at 8:05 am | Permalink

          No, JR put the figure on this site much higher than that. The claim of balancing the structural deficit was then changed to a percentage of GDP and now dropped altogether while making vast spending promises! This in addition to HS2 open Chequers book, EU departure open Chequers book payment, trillions unfunded uncosted zero carbon emission target. Then the Tories want us to be worried about Labour!

    • Mike Wilson
      Posted October 31, 2019 at 1:54 pm | Permalink

      UK net state debt is at an acceptable level

      What do you mean by ‘net’ state debt?

      Do you dispute the figure of £2.2 trillion shown on here. http://www.nationaldebtclock.co.uk/

      I’m not daft enough to think you run an economy like a household – with no debt. I realise you need to borrow to invest – not to pay for day to day expenses. But, surely, there has to be a sane limit or you are saddling future generations with massive debt for our benefit.

      Reply We own £435bn of the debt

      • acorn
        Posted October 31, 2019 at 5:19 pm | Permalink

        I pray for the day when citizens finally get to understand that the government’s treasury DOES NOT BORROW ITS OWN ISSUE, SOVEREIGN FIAT CURRENCY, FROM ANYBODY.

        Taxation and Treasury Gilt issues, do not fund the government’s spending; but, are used for day to day commercial bank’s liquidity control before they go back to the treasury and both are cancelled out of existence.

        Gilts are simply risk-free savings instruments for pension funds and insurance companies that pay out free “money” to them as interest!

        You need to understand that what is called the government sector’s “national debt”; is to the penny, the domestic private sectors “national savings”; and, the rest of the world’s foreign exchange reserves (savings) from selling us their stuff!

        • Edward2
          Posted November 1, 2019 at 8:14 am | Permalink

          The fact that on some balance sheet these two elements balance does not enable you to correctly claim that endless government debt creation will be a way of creating wealth.
          The magic money tree economic theory which increasingly seduces the left into its clutches is like a thirsty shipwrecked sailor deciding to drink seawater to quench his thirst.
          Ultimately futile.

      • hefner
        Posted October 31, 2019 at 6:03 pm | Permalink

        Sir John, how exactly do you get to £465bn? I want to check whether I could use the same method next time I see my bank manager.

        Reply I said the Bank of England owns £435bn of our debt and the state/taxpayers own the Bank.

      • acorn
        Posted October 31, 2019 at 6:15 pm | Permalink

        Public sector net debt ( = private sector net savings) is currently a bit less than £2,100 bn including the bailed out Banks, that still owe about £300 bn to the Treasury, from the 2008 bailout.

        The Treasury is currently paying about £40 bn per a year in interest payments on Gilts etc; plus, paying itself about £10 bn a year on the £435 bn of Gilts the BoE has “QE” swapped back into the cash that bought them originally. There was no “QE” increase in the net “money” in the economy, it just changed its form.

        Hence, those swapped Gilts no longer have any capital value but, are still paying interest back to the Treasury via its own wholly-owned BoE. (In reality, it’s a bit different but way beyond an MP’s understanding; nevermind 66 million proles.)

        Reply The Treasury pays interest on the QE bonds and receives a dividend back. The bonds have a capital value and could be sold on to the private sector

        • hefner
          Posted October 31, 2019 at 10:04 pm | Permalink

          Reply to reply to MW: £435bn is about 25% of our “debt”, and 30% are owned by UK insurance companies and pension funds, 17% by other financial institutions like banks, and 27% owned by foreign institutions. That’s still about £1.5tn floating around. Are we poor souls not cognisant of such financial “details” to be happy with this state of affairs?

          Reply to reply to acorn: yes but who in the private sector (apart from someone completely ensconced in the UK system, fully ignoring the world outside the UK and possibly impervious to the UK pound falling in value) would want to buy those bonds?

        • acorn
          Posted November 1, 2019 at 8:26 am | Permalink

          Prof Wray at UNKC [edited] “summarize QE this way. You have a checking account and a saving account at your bank. Your bank makes you an offer you cannot refuse to shift some funds from your saving account to your checking account. (Let us say they will give you a toaster as a reward—and you really like toasted bread.) Will this shift of funds induce you to run out and spend more? Probably not. Especially if you are worried about the future, your spouse was recently fired, and you are underwater in your mortgage. You might even spend a bit less because you earn less interest in the checking account.

          QE essentially amounts to shifting funds from a bank’s savings account at the Fed (Treasuries) to its checking account at the Fed (Reserves). It reduces bank earnings by a hundred or two basis points. And that is supposed to stimulate the economy?

  12. Fishknife
    Posted October 31, 2019 at 12:02 pm | Permalink

    Has anyone done a serious analysis of Labour’s plans in the light of the the Stability and Growth Pact, Maastricht rules on State Spending, & Article 2(1a) of Regulation EC No 1467/97.” i.e. the aim of economic policy had to be to get state borrowing down to 60% of GDP ~ hence Austerity?

  13. Lifelogic
    Posted October 31, 2019 at 12:03 pm | Permalink

    Corbyn just now saying private schools will have to pay their taxes in a “fare and proper” way. They already do mate. Does the dope not realise that the parents at such schools already pay three times over! And that putting VAT on fees and other attacks will just push more pupil onto the state system and raise a negative sum.

    Car sales slumping again I see. Well why buy a new car when individual councils like Bristol or Brighton might ban you vehicle anyway. They new electric one are not yet sensible technology for most people and cost a fortune even after the tax bribes. .

    • Mark B
      Posted October 31, 2019 at 5:14 pm | Permalink

      He means ‘new’ taxes.

    • Narrow Shoulders
      Posted October 31, 2019 at 8:58 pm | Permalink

      Every private pupil saves the state at least £5K.

      And that is after paying fees on taxed income.

      Stupid is as stupid does.

  14. Leslie Singleton
    Posted October 31, 2019 at 12:19 pm | Permalink

    Dear Sir John–I don’t buy this all-of-a-sudden clamour for tax cuts and stimulus. There hasn’t been much austerity for a start and so in any event I cannot see much need. One should do what is right for the country (lots of opinions on that of course–forget worrying about low inflation for instance) and go with the consequences. I don’t think much of getting the consequences where you want them (for now) and to hell with the debt (and the future). The need for living within your means catches up with you like night follows day if you don’t do it.

  15. villaking
    Posted October 31, 2019 at 12:20 pm | Permalink

    Sir John,
    In proposing both increases in public spending and reductions in taxation, I presume you mean to increase public borrowing. Do you believe there should be any absolute limit to the level of government debt? Since you and Jeremy Corbyn both want to increase the national debt, albeit it in different ways, do you think it will make it harder for you to level any claims of “magic money trees” etc. against the Labour party this time?

    Reply I have set out my balanced budget rule which is very different to Corbyn. I am proposing only allowing borrowing for qualifying investment projects. The figures do add up!

    • Hank Rearden
      Posted October 31, 2019 at 1:01 pm | Permalink

      Ah the magic “investment” word which trumps mathematics!

      • Lifelogic
        Posted October 31, 2019 at 3:09 pm | Permalink

        Whenever government say investment in this or that they invariably mean take the money off sensible people (who would have invested it wisely and piss it down the drain on some lunacy or other.

    • Hope
      Posted October 31, 2019 at 1:37 pm | Permalink

      Your figures are not that of the govt and sadly you have no influence. Since Major and Clarke trying to join ERM which cost people their homes, jobs and business, your party has never recovered the reputation of sound economics. Clarke should have been reminded yesterday that his recent disgraceful comments on TV about black Wednesday being a blip in history was far more to those who suffered from his EU fanaticism. There ought to be punitive consequences for MPs like him.

  16. Know-Dice
    Posted October 31, 2019 at 12:30 pm | Permalink

    I think we all know where Mrs May went wrong by alienating a large section of her core voters.

    Get them back on board, but just as important Mr Corbyn is just about to send a herd of unicorns in the direction of younger voters – this needs to be diverted at the pass….

    • Know-Dice
      Posted October 31, 2019 at 1:59 pm | Permalink

      I’m sorry Google says that should be a “Blessing of Unicorns” 🙁

    • Lifelogic
      Posted October 31, 2019 at 9:42 pm | Permalink

      Indeed. He clearly thinks he is Father Christmas with his magic money tree. He would give us Venezuela very quickly indeed.

      • hefner
        Posted November 1, 2019 at 9:15 am | Permalink

        Have you located the forest of Magic Money Trees that the CUP will be using, I wonder.
        And I look forward to the coming flurry of similar cliches by Lifelogic (and others). Bring them on, it is so refreshing.

  17. Mark
    Posted October 31, 2019 at 1:12 pm | Permalink

    I note the Chileans have cancelled the COP conference on the back of the riots they are enduring as a consequence of imposing high energy prices and increased fares. The rioters are clearly supporting prosperity, not zero carbon impoverishment – not that the BBC will admit it. A lesson for the UK.

    • Mitchel
      Posted October 31, 2019 at 2:47 pm | Permalink

      See also Argentina where the Peronist Presidential candidate has just defeated the western stooge who brought the IMF in earlier this year.And Ecuador where the US backed government(which also brought in the IMF;loans released as soon as Julian Assange was expelled from their London embassy) was chased out of the capital by rioters two weeks ago and had to abandon similar measures.

      • hefner
        Posted October 31, 2019 at 8:54 pm | Permalink

        And this afternoon the nice Mr Trump telling us whom to vote for. I am waiting for a torrent of invectives flooding this website similar to what followed Mr Obama’s comment on the referendum.

        Or not, because Mr Trump is, in the unforgettable words of the Lady, “one of us”.

        • Edward2
          Posted November 1, 2019 at 8:17 am | Permalink

          Have you changed your mind on who to vote for hefner after President Trump made his comments?
          Surely you aren’t that easily swayed.

          • hefner
            Posted November 1, 2019 at 4:57 pm | Permalink

            I will certainly vote TBP. Once elected, with the help of others (not CUP, not Labour) its MPs may help getting rid of/replacing the HoL, reducing the size of the HoC, pushing for a proper written constitution, and a proportional voting system. That might make the UK finally enter the 21st century, don’t you think so?

          • Edward2
            Posted November 2, 2019 at 7:47 am | Permalink

            You surprise me with your announcement of support for the Brexit Party.
            I had you down as a true Corbyn supporter.

        • hefner
          Posted November 2, 2019 at 8:54 pm | Permalink

          Dear Edward2, that’s the second time in about six months you cannot put me down correctly, once as a Remoaner, this time as a Corbyn supporter. Two out of two, not statistically significant, but a 100% fail rate nonetheless.

  18. Andy
    Posted October 31, 2019 at 1:19 pm | Permalink

    Countries outside the EU have recessions?

    Gosh. You should tell Brexiteers.

  19. Dominic
    Posted October 31, 2019 at 1:40 pm | Permalink

    Of far more importance are non-fiscal issues. Since 1997 Labour’s presence has been toxic to this nation, our freedoms, the British State, our democracy due to imported Labour voters and the abuse of postal voting, and our the safety younger people, PC politics for political gain, their now ownership of all the levers of the British State

    Non-Labour voters don’t want to see reform of Labour’s client state. We want to see its obliteration to prevent them from taking absolute and infinite control of every aspect of our lives

    Start by abolishing the opt-in system to cripple the finances of the unions who then circulate this cash to Labour and their left wing activist allies who then target Tory MPs with their intimidation

    You need to be radical to undermine Labour. Reform is the coward’s way out. We want to see Labour purged from all areas of the State and their power base dismantled

  20. Dame Rita Webb QC
    Posted October 31, 2019 at 1:46 pm | Permalink

    Since 2008 every incremental pound in GDP has only been achieved through an additional £5 in public and private borrowing. The Tories are just like a junkie who believes just one more bigger hit will make him feel all right when more likely it will kill him. If all they can offer is more tax and more borrowing, from that you can deduce that Boris will just keep you on the road to nowhere that you have been on since 2010.

    • Mitchel
      Posted October 31, 2019 at 3:22 pm | Permalink

      Dame Rita,we are past the point of no return-we have to print,print and print to keep the ponzi going until we eventually collapse.We have passed through an entire economic cycle without being able to normalize interest rates;the deficit is surging again -even before a downturn is evident in GDP figures.The “we” is effectively all of Europe.The only solvent country in(or should that be of) Europe is Russia-as the front cover of this week’s Economist says “It’s Putin’s World”(the title’s right,the content of the article is their usual propagandist twaddle).It is no different to the end of the western Roman Empire when all the silver drained away east,the currency was constantly debased and land grants(ie asset sales) replaced cash as payment to the barbarians for their military “support”.

      The silver lining in a Corbyn victory would be that the collapse will come sooner and we can start again albeit from an impoverished base as those asset bubbles deflate and the fake wealth is shown for what it is.

  21. Peter
    Posted October 31, 2019 at 1:54 pm | Permalink

    “The government is right to increase spending on schools and hospitals.”

    An unexpected Keynesian statement from a Conservative MP.

    I thought Milton Friedman ruled the roost since Maggie Thatcher came to power.

    Reply Nothing Keynsian about that statement. There might be about to finance it.

  22. Narrow Shoulders
    Posted October 31, 2019 at 1:59 pm | Permalink

    Do we not already owe a large sum of money?

    At what point do we stop borrowing to support our increasing population?

    • Dame Rita Webb QC
      Posted October 31, 2019 at 2:15 pm | Permalink

      When foreigners (who Carney sez whose kindness we are living on these days) start to demand a higher and higher rate of interest before they lend or refuse to do so, especially when they look at our balance of payments deficit and think they will only be repaid in worthless sterling.

    • Mark B
      Posted October 31, 2019 at 5:17 pm | Permalink

      At what point does this increased population start paying for itself ?

      • Dame Rita Webb QC
        Posted October 31, 2019 at 7:01 pm | Permalink

        Never. Its hard enough to try and find a decent job, even if you can speak English and have recognised qualifications. If you have none of these advantages the chances of you not becoming a ward of the state are very small. Hence you have communities with rates of unemployment in excess of 80% and no net contributions to the public purse.

        • libertarian
          Posted November 1, 2019 at 8:06 pm | Permalink

          Dame Rita

          Which country are you talking about?

          Here in the UK we have 859,000 unfilled full time jobs and the area with the highest unemployment is the North East at 5.4%

  23. steve
    Posted October 31, 2019 at 2:05 pm | Permalink

    Well I saw Corbyn on the telly this morning, laying out his manifesto.

    Suffice to say if he got into No 10 there would be no prosperity, it’s all tax and bash the rich. In my opinion the underlying tone of what he said was bordering very close to inciting hatred of anyone with money. Also his publicly accusing individuals by name was potentially libellous, I hope they turn round and sue him.

    Fastest way to cause mass exodus of wealth from this country is to elect Labour.

  24. formula57
    Posted October 31, 2019 at 2:26 pm | Permalink

    Tax measures that show Britain is open for business post-Brexit would be welcome, accompanied by some, rather overdue, that aid those many taxpayers who are just about managing. As for spending, Christine Lagarde seems to understand, even if our own Mr. Javid might not.

  25. Mark
    Posted October 31, 2019 at 2:29 pm | Permalink

    I see the tinpot dictators in BEIS and OFGEM plan to extort anyone who doesn’t manage to get a dumb meter installed. More austerity, not prosperity. If the Germans managed to decide they didn’t need to install them and waste enough money to fund the aid budget, we can do likewise. Besides, the implications of remote control of power supply per household are deeply troubling democratically.

    • glen cullen
      Posted October 31, 2019 at 6:36 pm | Permalink

      100% agree

    • Fred H
      Posted October 31, 2019 at 7:59 pm | Permalink

      We visited son in S.London who told us they could not have a smart meter installed. Reason…Almost all Victorian homes in London (elsewhere?) have their meters in the cellar/basement and do not get a signal…..At least a chunk of Londoners will not have their supply removed in a supplier widespread action.

  26. John S
    Posted October 31, 2019 at 3:41 pm | Permalink

    The NHS needs structural reforms. Until this happens, I wouldn’t give it another penny. Same with education.

    • Lifelogic
      Posted October 31, 2019 at 6:33 pm | Permalink

      Indeed dire state monopolies take it or leave it, get what you are given (or not given). Delayed, rationed, not provided at all and fairly incompetent too. They have your money already so patients to them are just a nuisance and it shows. The NHS is one of the worst health care systems (measured on outcomes which is what matters) for a developed nation.

  27. glen cullen
    Posted October 31, 2019 at 4:38 pm | Permalink

    Consensus amongst my colleagues is that Boris Johnson PM is in fact a remainer

    The PM has a golden opportunity to write in the Tory manifesto that they will be initiating a WTO policy and negotiate a FTA on the 13th Dec…..job done

    Consensus is that he will continue with the WA deal and keep us in EU for years

    • Lifelogic
      Posted October 31, 2019 at 6:42 pm | Permalink

      Well his putrid W/A treaty is still clearly far more remain than leave and certainly worse than just leaving. It costs a fortune for nothing and clearly handcuffs us in the trade negotiations. Better than Mays but still dire. Then again Corbyn/McDonnall would be really dire.

      • Lifelogic
        Posted October 31, 2019 at 6:49 pm | Permalink

        Given a decent leave majority in the house and without the appalling surrender act we should be able to get a far better deal. Anyone who voted for the outrageous surrender act should never be returned to parliament as they are clearly traitors to the UK of the first order.

    • steve
      Posted October 31, 2019 at 8:14 pm | Permalink

      glen cullen.

      Fully agree, but that would require Boris to have the mettle, which clearly he doesn’t.

  28. Martyn G
    Posted October 31, 2019 at 5:25 pm | Permalink

    “At what point do we stop borrowing to support our increasing population?” Good question, well presented but I fear that we are unlikely to hear an answer. I have heard that the population increase per annum is around 300,000 but does anyone have any idea how many of them become integrated into our society and become productive member of our society in work and taxation terms.
    Clearly, they will all need accommodation, their children schools, health service and all that goes with living in the UK. No one knows or will perhaps admit as to how many of those entering the country will immediately go onto benefits in order to exist.
    No one that I know – including myself – is against immigration per se but government seems uninterested in the increased strain being put on the education, health, benefits, roads et al arising from uncontrolled numbers of immigrants. Our borders are porous in the extreme – not least because of the actions of one Mrs May when Home Secretary and until we do strictly control immigration the situation can only worsen. Your question might be prefaced with ‘how much does it cost the UK to cope with and cater for immigrants our annum?’ Doubt that anyone would or could answer either question….

  29. Lindsay McDougall
    Posted October 31, 2019 at 5:49 pm | Permalink

    Apparently, this year’s borrowing requirement is likely to be closer to £35 billion rather than £20 billion because, inter alia, of lower than expected repayment of student loans.

    An increase of £34 billion in NHS funding has been promised – indeed, the PM is focusing on it in his election campaign.

    Then there is £14 billion to level up per pupil funding in education.

    £(35 + 34 + 14) billion = £83 billion.

    Then there is the cost of those 20,000 extra policemen and the promised infrastructure projects – rail, road, 4G etc.

    Pretty soon, you’ll be talking about real money!

    And all this while we are still paying more than £1 billion a month to the EU because we opted for a transition period.

  30. Ian@Barkham
    Posted October 31, 2019 at 6:23 pm | Permalink

    Prosperity is the key to every one’s future, without it living standards and the quality of life just can’t improve, without it we can’t address the need for a greener way of life among many aspirations.

    The loonier part of society believes their prosperity comes for taxing those that will in honesty just leave. They believe in causing the best educators to find another country to contribute too, instead of increasing the quality of education for all. Then again this is a well know political tactic – drive those out that would never support your rule, and you get to retain power.

    Prosperity will come from the person that looks back at you from the mirror. Not from some prescriptive doctrine. Not from some other mystical money tree, there is no magic and there is no someone else that will provide or cause prosperity to appear. Everyone is able to contribute, but not everyone is permitted to do so.

    It is not a gift of Governments to cause prosperity, it is their actions that stop it happening.

    The trick missed by the power crazies of the looney side of society, is we are not all the same, but different and that is what makes the human race so good. Prescriptive overarching doctrine is the recipe that causes decline. Let people be responsible for failure and you get a forward looking highly motivated society.

  31. BillM
    Posted October 31, 2019 at 8:00 pm | Permalink

    Lots of recession going on now. So, it’s just a matter of time before the mucky stuff hits the fan in the financial markets.
    Please let us be rid of the burdens that Brussels will impose on us if we are still a member of their cosy club, the EU.
    1929 will be but small potatoes compared to the problems of 21st Century ultra-cheap credit coming down to earth.

  32. steve
    Posted October 31, 2019 at 8:06 pm | Permalink

    JR

    “It is time for a UK stimulus to boost our economy.”

    To achieve that we first need to clear out the rot from parliament and prevent the left from driving wealth and jobs out of the country, which they will surely do if they get into power.

    Neutralising the proponents of wealth ‘redistribution’ and EU vassalage must be absolute top priority. They and their poison have dragged democracy through the gutter during the last three years. The wreckers must be prevented from doing so ever again.

  33. ian
    Posted October 31, 2019 at 8:45 pm | Permalink

    Trump let the cat out of the bag, can not trade deals with the UK under BJ treaty with EU, BJ is just another remainer and won’t have a pact because he doesn’t want outright win in the GE just like TM.

  34. hefner
    Posted October 31, 2019 at 11:00 pm | Permalink

    Tick tock tick tock tick tock tip tip tip tip tip tiiiiip (into a ditch).

    • Fred H
      Posted November 1, 2019 at 7:52 am | Permalink

      is that Labour unloading the sad old fool?

    • Hope
      Posted November 1, 2019 at 7:55 am | Permalink

      Well said Hef, I found it funny.

  35. Javelin
    Posted November 1, 2019 at 1:12 am | Permalink

    Why are taxes so high ?

  36. Cupped
    Posted November 1, 2019 at 2:52 am | Permalink

    We need to stop the Green nonsense. We can profit in so doing too as less politically stable nations are going ballistic looking a cursory glance at the oil news pages on various blogs.
    If, we keep our heads whilst others are most assuredly losing theirs. Explanations can be made but the deeper you dig…
    …We need better education about economics.
    We need a Parliament not based on youthful whim. Nor on MPs deliberately telling lies about economic realities for personal vote gain. The trouble is some of them believe their own rhetoric.Ask each one if they look pretty. Straight-jacket the ones who say Yes
    They look like as set of victorian toby-jugs when on TV, empty inside.

  • About John Redwood


    John Redwood won a free place at Kent College, Canterbury, He graduated from Magdalen College Oxford, has a DPhil and is a fellow of All Souls College. A businessman by background, he has been a director of NM Rothschild merchant bank and chairman of a quoted industrial PLC.

    Promoted by David Edmonds on behalf of John Redwood both of 30 Rose Street Wokingham RG40 1XU

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