Continuity in US policy

The strong disagreements between President Trump and President Biden were well followed and heightened by media comment in the run up to and aftermath of the election. They reflected some big policy differences as well as a chasm over style, behaviour and the results of the election. Where Mr Trump wanted to limit immigration President Biden wanted to make it easier. Where President Trump wanted to avoid long and costly lockdowns, President Biden wishes to enforce strict rules to respond to the pandemic. Where President Biden wishes to decarbonise quickly President Trump wanted to grow the fossil fuel economy faster to make the US independent of fuel imports.

When it comes to governing there is a lot more continuity than most commentators report. Both men believe in a large stimulus from the Fed to get recovery underway, favouring ultra low rates of interest, plenty of Fed bond buying to keep markets liquid and direct Fed support to banks and the corporate sector. Both believe in a substantial fiscal stimulus with the state spending considerably more than it collects in taxes, though they would disagree about some of the spending priorities. Both in particular believe in sending a decent sum of money to every US adult to spend to get things moving again.

Both men accept the general government advice in Washington that China is a major challenge to the USA. They both wish to confront China on intellectual property, security and Hong Kong governance issues, and President Biden is even more vocal on the issue of the Uighurs. Both believe in onshoring a lot more production capacity to create jobs at home and reduce US dependence on imports. Make America great again has transposed to build back better with more built and made in America.

As a result the US has now embarked on a massive policy experiment. They wish to run the economy hot. The Democrats have just narrowly passed a huge stimulus package, opposed by every Republican as too large. The USA will borrow an additional $1.9tn to get things moving, sending much of the money citizens to spend. Meanwhile the Fed has expanded the money supply by a stunning 25% over the last year.

In contrast the Uk money supply has grown at less than half that rate despite the UK efforts to provide a monetary boost. The UK fiscal boost is not as large as the US one adjusted for size of the economies and fell short of sending every person in the country a cheque to boost spending. We should expect the USA to outgrow us this year. We should also expect them to have more inflation on the back of their expansion. The US authorities are sure the pick up in inflation will be mild and helpful, not high and persistent. I will return to this in future blogs.

115 Comments

  1. Mark B
    March 12, 2021

    Good morning

    Make America great again has transposed to build back better . . .

    Not true. The Build Back Better is a globalist slogan not a patriotic one. One is generic and nonspecific. The other is unique and specific.

    In contrast the Uk money supply has grown at less than half that rate despite the UK efforts . . .

    Don’t worry, just like the Lockdown they will try again and again. I am not sure what behavioural psychologists would make of it, we could ask SAGE, but there is something about people who do something believing that it will work only see it fail. They then set about making excuses as to why it failed and that if they just do it again, only more so, it will work. I think they call it Socialism?

    1. agricola
      March 12, 2021

      Mark, your last paragraph could equally be a description of the EU.

    2. MiC
      March 12, 2021

      No. “They” call it “brexit”.

      1. NickC
        March 12, 2021

        Martin, Come back in 20 years time. Otherwise you’re just guessing.

    3. Nig l
      March 12, 2021

      Seems to me just another daily moan.

    4. Hope
      March 12, 2021

      Southern border is being overwhelmed with mass immigration with thousands of unaccompanied children. Direct result of Biden change in policy- watch senators and governors and read their news on it. Biden is causing humanitarian crisis and helping human traffickers. Patel here encouraging the same, the more illegal 8m irrational encouraged the more they will come. JR your govt and party encouraging mass illegal immigration.

      The Biden stimulus Bill only has 9% of money directed towards virus the rest left wing causes! Again, listen to senators and governors. They have not even spent the money Trump passed. Your govt through Johnson has wasted hundreds of billions. So there are comparisons between left wing Biden party and Johnson’s left wing govt. the rest of JRs blog is questionable.

      I was interested to read the potential conflicts of interest by SAGE members and the pharmaceutical companies and WHO in Con Woman yesterday. How they worked and have hundreds of thousands invested in the vaccination companies. JR, how can it be right these people have been standing alongside Johnson and Handcock pressuring the nation/people to be vaccinated when there are clear conflicts of interest? Could this explain why ready available and cheap prophylactics were not and are not promoted to reduce serious illness and death? The prophylactics were available way before vaccines yet not used or promoted or even featured as part of the strategy to return to normal. Why?

    5. Everhopeful
      March 12, 2021

      +1
      Or madness?
      Or possibly desperation?

    6. Denis Cooper
      March 12, 2021

      As I see it a lot of people, including politicians and scientists and public health officials, have had to learn on the job and make up advice and policy as they went along. Perhaps in some respects it has been a newer job than it should have been, perhaps previous lessons from around the world had not been properly absorbed, but that is not necessarily their fault and I am prepared to cut them some slack. I recall that early last spring there was a letter in a newspaper suggesting that this pandemic should be treated as a useful practice run to prepare us for a much more virulent pandemic in the future and I think there is something in that.

      1. Paul Cuthbertson
        March 12, 2021

        Agenda 21???

        1. Everhopeful
          March 12, 2021

          Yup!
          Better whisper it though.

        2. turboterrier
          March 13, 2021

          Paul Cuthbertson
          Totally correct.
          None as blind as those who will not see.

  2. Lifelogic
    March 12, 2021

    It is a great shame that Biden scraped home (especially for the UK). His agenda of to enforce strict lockdown rules to respond to the pandemic and his mad agenda to decarbonise quickly rather than grow the fossil fuel economy and make the US independent of fuel imports are huge errors. He has many other disasters planned too let us hope most of these can be stopped.

    These are the same error that fake Tory Boris and Queen Carrie are now making from their £200,000 interior designed flat.

    Meanwhile a scathing report blasts ‘unimaginable’ £37bn cost of coronavirus test and trace system. How on earth did they manage to spend this this. About 1.2 million man years on the average wage, it is unbelievable. Yet value delivered almost zero or even negative.

    1. Fedupsoutherner
      March 12, 2021

      Some consultants are being paid £7k a day equilivent to £1.5 per annum. Who in their right mind thinks this is acceptable?

      1. Peter
        March 12, 2021

        Fed up southerner,

        People who automatically think ‘public bad; private good’ without any further examination of the detail.

        Ministers who are persuaded by slick salesmen from preferred bidders for outsourcing work. Ministers who no longer have any in-house expertise to judge outcomes and value for money.

        Even the big bean counters are in on the act now. It’s no longer just additional consultancy work from firms whose books they audit. Not that they are always reliable in their role as auditors – but the consequences of a failed audit don’t hit them very hard either.

        So all consultants over promise and under deliver and try to keep decision makers in the public sector onside with the prospect of a lucrative role for them in future. Failure is no barrier to further contracts in the public sector either.

      2. Nick
        March 12, 2021

        I completely agree – this is grotesque and outrageous and should, in fact, be illegal. There should be a cap on the amount that the government can pay consultants. I would suggest £500 per day.

    2. Roy Grainger
      March 12, 2021

      They didn’t spend £37bn on test and trace. There is a difference between the money they allocated and the money they actually spent. And the great amount of what they spent was on testing, they are currently doing 1.5m tests a day and those tests and testing facilities have to be paid for. To say testing has brought zero or negative value is a peculiar argument.

      1. Lifelogic
        March 12, 2021

        It might be “a peculiar argument” but it certainly seems to be largely true.

    3. Andy
      March 12, 2021

      Biden didn’t just ‘scrape’ in. He won the popular vote by 7 points.

      By US standards it wasn’t a even particularly close election.

      1. Lom
        March 12, 2021

        ‘Won.’
        Plenty of evidence that vote was rigged. Biden is incoherent.

        1. MiC
          March 12, 2021

          Cite evidence which was not thrown out of court more than fifty times, please.

          1. Grahame ASH
            March 12, 2021

            Not thrown out of Court. The supreme Court refused to listen to the claims in many respects. The judges have proved themselves incompetent, possibly bent. They should have examined the claims.
            How can you respect the law and the election results when:
            dead people were allowed to vote
            more ballot papers were recorded than the number eligible to vote
            and that is just for starters

        2. Peter
          March 12, 2021

          Lom,

          Biden gets worse. He has trouble reading from the script, so his appearances are limited and no questions are taken. It is just a matter of time before he has to stand down.

        3. Lastgasp
          March 13, 2021

          Evidence was not produced in court-not in many courts- and Biden won so that’s it

      2. Richard1
        March 12, 2021

        He won 52-48 – not by 7 ‘points’. A close, but as you say decisive, victory – which anyone who calls themselves a believer in democracy should accept.

        Of course the same logic should apply to such a vote in the U.K.

        1. Grahame ASH
          March 12, 2021

          There is too much evidence to show Democracy was absent in the election results

    4. Narrow Shoulders
      March 12, 2021

      From the report

      https://publications.parliament.uk/pa/cm5801/cmselect/cmpubacc/932/93202.htm

      3.On 28 May 2020, the government launched the new NHS Test and Trace Service (NHST&T), which brought together test and trace services into a national programme, working in conjunction with Public Health England (PHE) and English local authorities.3 The government has committed £22 billion funding to the programme for 2020–21 and £15 billion for 2021–22.4 Up to November 2020, spending to date by NHST&T totalled £5.7 billion.5 Between May 2020 and January 2021, NHST&T rapidly expanded UK testing capacity for COVID-19 from around 100,000 to over 800,000 a day.6 It has also contacted 2.4 million people testing positive for COVID-19 in England and advised more than four million of their associated contacts to self-isolate.7

      12.NHST&T relies on contractors for many of its supplies, services and infrastructure. The Department stated that, to scale up NHST&T so rapidly, it had used a “blended mix” of civil servants, military support, contractors and consultancy support.40 By the end of October 2020, NHST&T had signed 407 contracts worth £7 billion with 217 public and private organisations, of which 121 (or 70% of the contract value) were assigned as direct awards without competition under emergency measures.41 The Department told us that, in November and December, it had awarded a further 207 contracts worth £1.3 billion, of which around 30 were direct awards under emergency regulations. It anticipated further reductions in the use of these regulations in favour of competitions and tendering exercises in future.42

      13.The response to a parliamentary question confirmed that, at the beginning of November 2020, there were 2,300 consultants and contractors working for 73 different suppliers in NHST&T, with a total consultancy cost of approximately £375 million up to that point.43 However, when giving evidence to the Science and Technology Committee on 3 February, NHST&T said that it was still employing around 2,500 consultants.44 When we took evidence in mid-January, the Department estimated around 900 contractors from Deloitte alone were still on NHST&T’s books.45 The Department reported to us that the average cost per consultant was about £1,100 a day, up to a maximum of £6,624 for some consultancy staff.46 It also said it had plans to reduce NHST&T’s reliance on external consultants, although this was dependent on the availability of civil service recruits to fill posts and future demand for test and trace services.47

      The surprising thing here is that they have only spent 0.1% of the total spend on the overpaid consultants. They were operating on a spreadsheet for the first six months so where has the money actually been spent?

      £10 billion has been reserved for rapid testing but that still leaves a huge amount being spent. No wonder the private sector was able to ramp up testing to its current levels. Where there is taxpayer cash, there is profit.

      Cheaper to pay for arrivals into the country to isolate for two weeks from March 2020 to prevent the disease proliferating.

    5. Iain Moore
      March 12, 2021

      We learn this morning our xxxx government has capitulated to the green mob and putting the proposed coal mine to a public inquiry. It seems its more important to burnish their climate change credentials for the summit in Glasgow than ensure we are still able to produce steel. All these green nuts like Boris and Carrie should be banned from using steel, I am sure Carrie would love to have wooden white goods in her £200,000 make over of 10 Downing street, a wooden washing machine used to be known as a wash board, I am sure she will love using that.

      1. Fedupsoutherner
        March 12, 2021

        Yes pathetic isn’t it? I thought governments were meant to govern. Not sign decisions over to virtue signalling NGO’s.

      2. The Prangwizard
        March 12, 2021

        When I was a boy my mother did the washing of clothes in what we called a ‘copper’. It was merely a big bowl in which to boil the clothes with soap. She did rub them on a washboard. Afterwards she would squeeze them dry by means of a mangle – two rollers, made of wood – which she worked by means of a handle. The odious Greens like ‘Boris’ and his sleeping partner Carrie probably think we should go back to this to save the planet, but not themselves of course.

    6. Hope
      March 12, 2021

      Biden’s left wing agenda of control is becoming clear, HR1 is outrageous, and there is vast unrest across the country, outside California and New York, that children not allowed back in School. It is clear left wing big tech trying to help spread the left wing agenda by steering and directing people what they can or cannot read and say.

      In the UK we read the military and Dowden’s department engaged heavily in social media to counter misinformation! Who decides what that is? Orwell’s ministry of truth is here under Johnson, alive and spreading what the totalitarian state is truth!

      1. Hope
        March 12, 2021

        JR,
        We read today Home Office, in conjunction with others i. Public sector, in an experiment, are trying to see if it can gather all network searches from every individual under the Snooper Charter! Why?

        Your party and govt. are becoming totalitarian. Already using arms fo the state to tackle what it considers misinformation on line, taxing what we can eat, limiting further what we can say and think, when we can protest etc.

        When are any of you of a conservative mentality going to take action against your govt.?

        Jenrick going to have a public review of the coal mine in Cumbria! Why does your govt. think it is okay to import the majority of our coal for manufacturing and giving jobs for mining and manufacturing to China and India rather than here and in the north! It does. To help your idiotic govt let me sage his department some money. The world or climate will not derive any benefit whatsoever by giving jobs and industry to China. It will make China’s determination to dominate the world become a reality while committing horrendous crimes against humanity. Why is your govt helping China to be cruel? Has Johnson learnt nothing from Hong Kong and breaking treaty?

        1. a-tracy
          March 13, 2021

          Why is it considered greener to ship in coal? Surely if should be allowed to produce up to the amount we ship in.

    7. Hope
      March 12, 2021

      LL,
      Biden and Johnson govt are very similar in their extreme left wing thoughts and actions.

      Hate crime Bill passed in Scotland. Anything it deems is hate will be against the law. Free speech and thought now gone in Scotland. The people will be silenced on any subject the govt deems fit. Including the reach to your own home. China will be proud.

      First following China in locking up the nation, forbidding peaceful protest against govt now the people not allowed to dissent at all!

      Raab condemned the Russians for arresting people against govt dissent but remained silent in his own nation! Nor did he speak out or claim outrage against Dowden’s department or the military trawling the internet to counter for what the govt might claim to be misinformation! We the taxpayers’ are paying people to trawl the internet to counter govt. misinformation, think about that. Johnson used be a journalist! A bit like Johnson, when mayor, criticising Brown for encouraging diesel cars then taxing them to prevent their use. Compare to his recent getting rid of petrol and deisel cars altogether. He is an absolute shyster.

    8. Everhopeful
      March 12, 2021

      Line a lotta pockets though!

      1. Lifelogic
        March 12, 2021

        +1

    9. Denis Cooper
      March 12, 2021

      Would you trust this woman to produce a balanced report on anything?

      https://meghillier.com/content/brexit

      “As Chair of the Public Accounts Committee I have worked with colleagues to publish nine reports on how well the UK is prepared for Brexit and we have concluded that even with a deal we are not ready to leave. If we leave without a deal there will be huge uncertainty at the ports with any business or institution relying on imports seriously affected.

      Withdrawing Article 50 (or at least extending it) would be the best outcome but I am gloomy about the prospect. The Labour leadership has said we may need to delay Brexit to avoid crashing out and that a public vote is still an option.”

      And so forth.

      I do not fully understand how the Commons select committee system works but perhaps our host could explain how it came about that so many of the committees were – and still are – chaired by MPs who were – and still are – vehemently opposed to Brexit and prepared to try anything to stop it.

      Select Committee chairs are elected by MPs. Some only have Conservative candidates and some only have Labour candidates by agreement.

      1. Denis Cooper
        March 12, 2021

        So why was it agreed that Hilary Benn should be ideally positioned to try to stop Brexit?

      2. hefner
        March 12, 2021

        Public Accounts Committee, 16 members, 9 Conservative (G. Bacon, K. Badenoch, S. Bailey, G. Clifton-Brown, C. Gillan, R. Holden, B. Jenkin, C. Mackinlay, J. Wild), 5 Labour (M. Hillier (chair), O. Blake, B. Gardiner, S. Mahmoud, N. Smith), 1 SNP (P. Grant), 1 LidDem (S. Olney).

        Maybe you should clue yourself how the Select Committees work, shouldn’t you?

        Will you still be going on about Brexit and who said what before 1 January 2021 twenty years from now? Or have you not yet digested the 741 votes you got for UKIP at the 2001 elections that Theresa May won with 19,506 votes?

        1. Denis Cooper
          March 12, 2021

          Ah, that election when I said at the count that 741 votes was just a start and we would carry on until we got the UK out of the EU. But I’m not sure what that has to do with Meg Hillier and Hilary Benn and Simon Hoare being unfit to chair Commons select committees.

          1. hefner
            March 13, 2021

            It has obviously nothing to do, except possibly as an example of how attractive your political statements are: how precisely can you justify that Hillier (Public Accounts), Benn (Brexit) and Hoare (Norther Ireland) are unfit to chair Commons select committees. State your reasons why you think so instead of this type of meaningless statements.
            And what do you think of the chairs of the other CSCs?

    10. a-tracy
      March 12, 2021

      Lifelogic wasn’t the vast majority of it was spent on free testing, the majority wanted more testing. A private test costs from £99 to £140.

    11. MiC
      March 12, 2021

      “Scraped home” by millions in the popular vote, and by the same margin in the College as Trump described as a “landslide”.

      But at least you admit that Biden won.

      Trump has just personally requested his third postal vote, incidentally. Seems he trusts them after all.

      1. NickC
        March 12, 2021

        Well, Martin, is that the same “millions” that Leave scraped home by in the Referendum?

    12. Bill
      March 12, 2021

      What is this about Trump being better for us than Biden? Trump was in office for four years and I didn’t see him do much for anyone- he couldn’t even build the wall- all he did was mouth off and build cages to hold little children down at the border. Suffice to say the way Boris and Frosty are going especially about the NI Protocol I don’t think Biden is going to bother much about us either- look at it this way- we have suceeded in turning the whole of the European countries against us- America is only luke warm- the Australians are contemplating another vote on becoming a republic- and india will do a deal with us but for that they want hundreds of thousand of visas- it’s all mad stuff

      1. matthu
        March 12, 2021

        The cages were built under Obama’s presidency.

      2. Lastgasp
        March 12, 2021

        And where is Liz Truss with all of the new trade deals with countries far away that we were promised? and where is IDS who told us about the German car workers who would be knocking Ms Merkels door down? or what about Ml Gove who said the French wine producers that they would be doing cartwheels in the strerts if we didnt get tge deal we wanted? Lastly then what about the great DD who said the EU always settled at the last moment- well in this case they did and that is why we have the NI Protocol. Sigh sigh

    13. NickC
      March 12, 2021

      Hey, Lifelogic, it’s only taxpayers’ money after all. Remember – as a memorable government employee once told me – the paperwork is more important than the product.

  3. Ian Kaye
    March 12, 2021

    This US fiscal boost will be the first of many.PPI payments here boosted new car sales but the longer term economic impact was negligible,to say the least. As US interest rates turn negative the dollar will strengthen, even if there is is large-scale immigration from Mexico the inflationary impact of this won’t amount to very much.

    1. Mike Wilson
      March 12, 2021

      @Ian Kaye

      As US interest rates turn negative the dollar will strengthen

      I thought the opposite was true.

  4. Lifelogic
    March 12, 2021

    So Jess Philip, shadow minister for domestic violence, reads out the names of 118 women killed by men in UK over last year. An appalling and sad toll I agree.

    So will anyone read out the names of the circa 450 men murdered each year (about 80% of murder victims are male). Or even the 1000+ men killed since 1st Jan by the abject failure of government and JCVI to vaccinate in a rational priority order by actual gender risk to Covid? An obvious adjustment that would have cost nothing, protected the NHS better, enabled earlier opening up, save many tens of thousands from covid infection and saved £ billions in the process too.

    1. No Longer Anonymous
      March 12, 2021

      + 1

      Or the number of men who die before their wives after a life of toil and shift work ? A disparity of 4 years on average.

      We are not allowed to point the finger when it comes to terrorism, stabbings or rape gangs but it’s OK to smear half the population for something which they are 3x more likely to be a victim of.

      So. Under the cover of lockdown we’ve had Marxist attacks on:

      – Capitalism

      – British Culture

      – The Monarchy

      – Men

      1. No Longer Anonymous
        March 12, 2021

        “Men have to change their attitudes and how they behave.” Campaigners on BBC 1 this morning. How about we get tough (really tough) with the criminals that do this sort of thing and leave the rest of us alone ? Oh. Forgot. Andy says prison doesn’t work.

    2. Andy
      March 12, 2021

      The difference is that half of the women on that list are killed by their partner. Killed by the person who is supposed to love and protect them the most.

      Jess Phillips – an excellent MP – made a very powerful point.

      Whilst the victims she lists are the extreme end, misogyny has deep routes within our society and our politics. And I’m afraid the current government – with its old boy network – and our politics, with its macho culture, is a major part of the problem. Particularly the Tory party and the Faragist parasites who now feed off it.

      Look at the countries which have dealt with Covid successfully. New Zealand, Finaland, Iceland – many are run by women. The Covid failures – US (Trump), U.K. (Johnson), Brazil (Bolsanaro), India (Modi), Mexico (Lopez Obrador) are all self-professed macho men. And are all epic failures.

      1. a-tracy
        March 13, 2021

        It’s always nice to read from Andy where the next attacks on conservatives are going to come from. John Redwoods blog is one of the most female friendly, female contributed to political blogs I’ve ever read. Dont keep underestimating women Andy unless of course you are female and if so why would you run your own sex down? Women should not need to bring down men, their fathers, husbands, brothers, sons – we play a valuable role in society and always have. Perhaps if any investigation is had by Jess Phillips its what do these males that physically attack females have in common are they sociopaths, psychopaths we need to become better at identified what triggered them and what was the trigger point.

        We have had an amazing female head of State for nearly 70 years God Save Our Queen.

    3. JayGee
      March 12, 2021

      You have no heart, Lifelogic, and you missed the point. The debate in the HoC coincided with International Women’s Day. Jess Phillips cares enough to make sure she reads out the names of every woman who has died in that year in the UK as a result of an act of male violence. She stands up in the HoC to do that every year. Ever heard of domestic violence? Something that ruins the lives of many women, year after year after year, even though it does not always end in the death of the victim.

      A report by the UN showed that 6 women are killed every hour by men around the world and mostly by men in their own family or by their own partners. 50,000 women killed each year by people they should be able to trust.

    4. Dave Andrews
      March 12, 2021

      No doubt parliament will swing behind stiffer penalties for the criminals, rather than address the societal issues that generate violent men.
      Still, this government guided by the science may get a scientific answer, like the behaviour is the product of evolution, or it’s consistent with the chemistry of the offender’s brain, and no laws of physics have been broken. Hardly adequate either way.

    5. ian@Barkham
      March 12, 2021

      @LifeLogic +1
      or how to send Women’s rights back to the dark ages

      1. Everhopeful
        March 12, 2021

        Try leaving your home for too long…or driving too far or sitting on a park bench or demonstrating.
        We none of us have any rights now!
        Our paid representatives have stripped us of them.

    6. Nig l
      March 12, 2021

      If you bothered to get elected rather than the easy route of arrogantly carping and denigrating everyone and everything you could have read the men’s names out.

      Well done to Jess Phillips, raising awareness of issues such as this is very important.

      1. Lifelogic
        March 12, 2021

        I would never stand (and no one would elect me anyway as I tell the truth) – not usually the best way to get elected as a politician. Also in the FPTP system you need an established Party and I could never join a party like the Tories stuffed with so many appalling LibDems or worse (nor I suspect would have have me given the types they tend to choose).

        Also I would have to move back to the UK and pay perhaps 20 times more in tax than the salary and benefit derived, even if I were elected. Plus 40% of my assets should I die early and 55% of much of my pensions.

        1. MiC
          March 12, 2021

          Oh, come on. The BBC’s just got rid of much of its comedy output.

          It appears to be looking for wit and repartee such as yours these days, so come on over eh?

    7. Fedupsoutherner
      March 12, 2021

      Women have lived for decades being apprehensive about being alone at night. I remember the Ripper days so we were always taught by our parents to take care. Dare I say it but much of the violence against men stems from gang culture which is harder to deal with in the inner cities. Knife crime and guns have made the figures sky high.

      1. MiC
        March 12, 2021

        Still only one sixth of the per capita murder rate of the US, mind you.

        This capital punishment business doesn’t seem to be much of a deterrent, does it?

    8. Nick
      March 12, 2021

      Yes, it is shameful and appalling that these female MPs (and a lot of posturing male MPs too!) don’t care about men at all. They don’t care how many men die, and would certainly never campaign for them or read out their names in arliament. What we have here is MISANDRY, as simple as that. More men are killed each year than women, so whenever personal safety is discussed this should focus on helping and protecting men as well as women.

  5. agricola
    March 12, 2021

    Your return to this in the future is my let’s wait and see if anyone has got it right. I will also be waiting to see if the misunderstood politics of the Irish border gets in the way of a UK/USA trade deal, or whether awakening pragmatism in the Biden camp re the EU will take root. Both think themselves socialist, but are at the extremes of that movement as to find each other unrecognisable.

  6. Sea_Warrior
    March 12, 2021

    ‘The USA will borrow an additional $1.9tn to get things moving, sending much of the money citizens to spend.’ This is a shocking indictment on the American political class – and on the Democrats in particular. Savings accounts are bulging with money ready to do some stimulussing. All the people need to be allowed to do is to be allowed to spend their money. So let’s have no more talk, here, of stimulating the economy. And no more of Johnson’s hare-brained, wasteful projects dignified by the false accolade that they are ‘investments’.

    1. MiC
      March 12, 2021

      As for “getting things moving” here, we read that in the first properly recorded month, exports to the European Union are down £5.6 billion, about 40%.

      How is that supposed to help the balance of payments deficit?

      Reply The deficit with the EU fell sharply

  7. formula57
    March 12, 2021

    The Congressional Budget Office expects (whilst ignoring possible future recessions) Federal debt to match GDP by the end of Fiscal Year 2020 and reach 202 per cent. of GDP by 2051 (before which point, in 2045, interest expense will exceed all other lines of federal spending). There is continuity!

    America has likely been in decline since Ronald Reagan left office and it is hard to see that running up such enormous debt is the way back to prosperity and a “morning in America”.

  8. Narrow Shoulders
    March 12, 2021

    Inflation must be a possibility – I am looking to take my savings out of the bank and buy some assets to guard against this.

    Or maybe take out huge loans and have inflation pay them for me just like the government

    1. Richard II
      March 12, 2021

      Do both – sounds like a good plan!

    2. Dennis
      March 12, 2021

      ‘Or maybe take out huge loans and have inflation pay them for me just like the government’

      I’ve never known how this works. Who would in their right mind lend money without the proviso of getting repaid, with interest, at the value of the loan at the time of giving it – inflation proof.

      If lenders like devaluing their assets there must be a profitable catch somewhere – can anyone help please?

  9. oldtimer
    March 12, 2021

    The huge monetary expansion by both Presidents does not augur well for the integrity of the US dollar. It will not end well. It is also reported that Burden has yet to hold a press conference, answering questions from the White House press corp. Some say the reason is that he is not up to it! If true, this is alarming.

  10. oldtimer
    March 12, 2021

    The huge monetary expansion by both Presidents does not augur well for the integrity of the US dollar. It will not end well. It is also reported that Biden has yet to hold a press conference, answering questions from the White House press corp. Some say the reason is that he is not up to it! If true, this is alarming.

    1. Iain Moore
      March 12, 2021

      It is not just the $1.9 tn Covid stimulus , I gather there is a $2tn infrastructure package in the pipeline.

    2. hefner
      March 12, 2021

      Do you expect this to be much worse than Churchill having a stroke on 23 June 1953 and R.A. Butler practically ‘running the country’ for him with Christopher Soames over the rest of the summer.

      Winston Churchill’s acute stroke in June 1953, J. Royal Society of Medicine, 2018, 111, 347-358.

      And at the time people were not ‘alarmed’ as the whole event and its consequences were kept secret for thirty years.

      1. Hope
        March 12, 2021

        Hef,
        Interesting, but totally wrong thing to do. Obviously in stark contrast the US president elected on totally different terms to UK PM.

  11. Bryan Harris
    March 12, 2021

    There are far more differences between Trump and Biden than suggested here.

    Biden has already escalated conflicts while Trump created opportunities for peace and pursued those towards success.
    Is it any wonder the stimulus bill was opposed by so many…. Only a fraction of the money involved will go to the people of America. A huge chunk goes to promote abortion and left wing politically correct goals, as well as friends of democrats. They even provide money to send outside the USA for abortions in other countries.

    How anybody could justify the chaos at America’s southern border is beyond rationality. Trump was beaten up many times for kids held in cages down there. A policy he inherited from Obama, Now there are a whole lot more kids in cages, but do the MSM attack Biden for this? NO – THEY ARE TOTALLY QUIET!

    Biden is a puppet president, demonstrated by his lack of coherence on too many instances. If the democrats do not crash the American economy it will not have been for their lack of trying to.

    We certainly should not follow the USA at this time.

  12. Nig l
    March 12, 2021

    Yes, an interesting ‘experiment’ challenging established views on inflation, certainly our Treasury looks very timid by comparison.

    Labour asked a very relevant question. As you now agree with them that cutting corporation tax does not raise revenue, when will you take responsibility for the 90 odd billion loss to the Exchequer?

    1. Mike Wilson
      March 12, 2021

      @Nig 1

      Labour asked a very relevant question. As you now agree with them that cutting corporation tax does not raise revenue, when will you take responsibility for the 90 odd billion loss to the Exchequer?

      That is a very simplistic way of looking at things. A company earns a profit. Let’s say it can either pay corporation tax or do something else with it. Let’s say it invests some of it in new office furniture, computers and carpets. It will pay 20% VAT when it does that – not far off the corporation tax it would pay. And whoever it buys from will make a profit and employ people and pay taxes and the people will pay taxes and so on and so on. Either way, the government gets hold of the money. It’s just that one way it generates more demand in the economy and the other way (the government getting it direct) creates less demand.

  13. ian@Barkham
    March 12, 2021

    There is a lot to be said about the comparisons, with all Governments and all Nations. The US as with the UK has major faults. However the US does have a way of getting the important major things done, the latest example, having started late with the vaccine role and with no NHS just private enterprise the US compared to the UK on a pro-rata basis is now well ahead.
    The US has a way of creating pride in itself and its people. The UK has a way of denigrating and distrusting the people. The US doesn’t pull its Nation down at every turn, the UK is filled with a noisy crowd, that in its taxpayer funded institutions believe that is their purpose above all, all backed by a media that has been top to bottom taken over by the left.
    All democracies are flawed but better than the alternatives, the US still manages to create a semblance of Government of the People for the People – the UK has a massive disconnect it has a HoC that for the most part still craves to be externally ruled, it has a HoL that has no place or purpose in a democracy in fact it undermines the very purpose and proposition of democracy.
    Lord Frost (a clear contradiction from me) had it right in his piece published in the Telegraph last week when he stated(paraphrased) “the People just wanted to take back control”. To the greater majority that means a proper democracy, with laws, rules and governance coming via a democratically selected and elected parliament.

  14. Iain Moore
    March 12, 2021

    It would appear most of the $1.9 tn US stimulus is not going to the US citizen, I believe £600 billion to them, the rest is going to pet projects of the establishment, it would seem they have used the Covid stimulus as cover to get away with a lot of rubbish. I am not sure if funding gender studies in Pakistan is still part of it, but we will see .

    I believe the Government should take more notice of what is now taking on the US border regarding immigration, Angela Merkel’s ill judged intervention in the EU had pretty dire consequences, what Biden is doing on the US’s southern border is of the same order. Caravans have set off from South America , illegal crossings are massively rising , eventually we will see on our screens people flooding across the border , at that point the Priti Patel Channel taxi service will come under scrutiny.

    1. Andy
      March 12, 2021

      By an accident of birth you live in a rich, relatively stable country. This is not an achievement of yours. It is luck.

      But you are only a natural disaster or a civil war away from being a displaced person. If that ever happens to you let’s hope others do not treat you with the contempt that they treat them.

      When they were dishing out good old common human decency perhaps they missed you out.

      1. No Longer Anonymous
        March 12, 2021

        That view prevails so we’ll see how it turns out.

    2. turboterrier
      March 12, 2021

      Iain Moore
      The PP Channel Serviceshould have been heavily scrutinised months ago.

      Where is the person with the guts to stop them with a either turn back or be sunk on sight policy. Only when people go back to whence they came telling how tough and bad it is taking the risk to get here will people stop wasting their money and lives being in debt to the smugglers for the rest of their days.
      Talking sure as hell had no effect.

  15. Nivek
    March 12, 2021

    In July 2019 you wrote the following with regard to the reported storming of a legislative building:
    “The damage done to the Legislative Council building provides a reason the authorities will use to clamp down, in reprisals that may go beyond just the few who did physical damage to the place.”
    (Source: “Democratic politics should be about the needs of voters, not the vanities of the media and politicians”, July 3, 2019.)

    The building to which you were referring was in Hong Kong. What do you think are the key features of present-day American politics that make “reprisals that may go beyond” inconceivable in the latter country?

    1. The Prangwizard
      March 12, 2021

      As I understand it, Biden has decided to keep the big fence around the White House compound. It all ties in with revolution practise; enemies of the revolution are always claimed to be active which justifies any and all authoritarian actions.

  16. William Long
    March 12, 2021

    Let us hope that the Americans’ hopes regarding inflation are born out in practice, but everything I know about its impacts in the past indicates that once it gets going it is very difficult to control, so I am not optimistic. Where America leads, this country almost inevitably follows.

    1. hefner
      March 12, 2021

      Looking at economicshelp.org ‘History of inflation in the UK’ I would not be so pessimistic.

  17. weary eye
    March 12, 2021

    Exports of UK goods to the EU plunged by 40.7% in January during the first month since Brexit and the toughest Covid lockdown since the first wave of the pandemic, driving the biggest monthly decline in British trade for more than 20 years.

    In the first month since leaving the EU on terms agreed by Boris Johnson’s government, the Office for National Statistics said goods exports to the bloc fell by £5.6bn, as imports fell by 28.8%, or £6.6bn.

    Off thread but it will be a major talking point, so have you got your excuses ready?

    Reply There were CV 19 closures on the continent, and big stockbuild in December. Interesting that the trade deficit fell.

    1. MiC
      March 12, 2021

      It’s interesting, that overall trade in goods with the European Union fell abruptly by about twelve billion at the end of the Transition Period, not at the point of some lockdown or other, yes.

      If this billion or so reduction in the deficit for the month were continued, then there would be a modest benefit from that – but are you claiming that it would offset the damage done by the large decrease in general economic activity, John?

      Reply It’s a one off thanks to Cv 19, stockpiling end 2020, new systems, closedEU frontiers etc

      1. Denis Cooper
        March 12, 2021

        “Not at the point of some lockdown or other”

        https://www.gov.uk/government/news/prime-minister-announces-national-lockdown

        “Prime Minister announces national lockdown”

        “Published 4 January 2021”

      2. MiC
        March 12, 2021

        We’ll see, won’t we?

    2. Fred.H
      March 12, 2021

      UK would be wise to plan to live and trade without EU being involved.
      Made me think of ‘ The shapes of things…
      lyrics by Keith Relf & Paul Samwell-Smith (Yardbirds 1966)
      Shapes of things before my eyes,
      Just teach me to despise.
      Will time make man more wise?
      Here, within my lonely frame.
      My eyes just hurt my brain.
      But will it seem the same?
      Come tomorrow, will I be older?
      Come tomorrow, maybe a soldier?
      Come tomorrow, will I be bolder than today?
      Now, the trees are almost green.
      But will they still be seen,
      When time and tide have been?
      Soon, I hope that I will find
      Thoughts deep within my mind,
      That won’t disgrace my kind.

    3. Nick
      March 12, 2021

      I’m not convinced that Lord Frost is right when he says this is a ‘one-off’, due to things like stockpiling and Covid. The ridiculously onerous forms and costs involved in exporting to the EU mean that many companies have just given up on it. This is not necessarily particularly bad, since they can find alternative markets (and many report having done so) and we are also cutting our imports from the EU, so our balance of trade has actually improved! If only Boris wasn’t so stupid as to let EU exporters off the hook for another six months in terms of their own costs. We should stop helping our EU enemies But what can you expect with someone as useless as Boris? What all this also proves, of course, is that those of us who said that a no-deal Brexit was better than a bad deal (which is what Boris gave us) were absolutely right!!

  18. Iago
    March 12, 2021

    The communists have seized power in the United States, which they wish to destroy. Move along there, nothing to see. We are in a similar situation.

    1. MiC
      March 12, 2021

      I suppose that if someone claims to believe this utter rubbish, then they think that they might be excused the criminal acts which they intend to perpetrate in order to overthrow a democratically-elected administration.

      That is why you are intentionally deaf to reason, isn’t it?

      1. Fred.H
        March 12, 2021

        You have never accepted the democratically decided Ref. and GE. Apart from endlessly bitching on about it have you, or do you plan to do criminal acts to overthrow them?

        1. MiC
          March 12, 2021

          I accept both the referendum result and the General Election’s.

          They indicate widespread moral degeneracy in my opinion, but the results are what they are.

          Where have I ever said that I did not?

          I will continue to do all within my abilities and the law, along with millions of others, to cancel the effects of both however, as one would expect in a democracy.

          If you don’t like that, then hard luck old chap.

  19. Kris
    March 12, 2021

    Don’t know how you can compare us in this way with the US even adjusting for size. The USA is part of a huge continent made up of fifty states five thousand miles away whereas we are a small isolated island on the coast of the european continent- it’s hardly apples and apples

  20. Mark Thomas
    March 12, 2021

    Sir John,
    I doubt if Biden decides anything.

    1. hefner
      March 12, 2021

      $1.9tn is nothing?

    2. MiC
      March 12, 2021

      Oh, I think that you will find that he indeed is as good as his pre-election word on Ireland and on trade deals.

      1. Denis Cooper
        March 12, 2021

        Do not believe the Tory myth about the massive value of a trade deal with the US, or indeed any trade deal.

        https://johnredwoodsdiary.com/2017/11/30/no-deal-is-better-than-a-bad-deal-3/#comment-904260

        The economic benefit would be marginal for both sides, and both sides could perfectly well live without it

        1. MiC
          March 12, 2021

          No, I never did, Denis.

          1. Denis Cooper
            March 13, 2021

            That’s good, because while the Daily Express today:

            https://www.tomorrowspapers.co.uk/daily-express-front-page-2021-03-13/

            may hold out the prospect of a “fantastic” US-UK trade deal “that will bring wealth to every corner of our nation” when I turn to page 4 I find that Liz Truss does not actually provide any estimate of the potential overall gain for our economy.

            For that I have to explore beyond her usual gross exaggerations to page 32 here:

            https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/869592/UK_US_FTA_negotiations.pdf

            “A trade agreement with the US could increase UK GDP in the long run by around 0.07% (within a range of between 0.02% and 0.15%) or 0.16% (between 0.05% and 0.36%) under scenario 1 and scenario 2 respectively. This is equivalent to an increase of £1.6 billion or £3.4 billion compared to its 2018 level.”

            Which is of similar magnitude to the UK’s projections for the potential benefit to the UK economy of the EU’s proposed TTIP deal with the US back in 2013, page 14 here:

            https://www.europarl.europa.eu/RegData/etudes/IDAN/2014/536403/EXPO_IDA%282014%29536403_EN.pdf

            “The study shows that the relative impact (i.e. as a share of GDP) of the TTIP is similar for the UK and US economies – between 0.15 and 0.37 % of GDP. For the EU27, the study suggests that the relative gains would be about twice that – between 0.4 and 0.8 % of GDP. The difference in the magnitude of the FTA’s potential impact on the UK and the EU is explained by the difference in the two’s initial level of openness with the US.”

  21. Everhopeful
    March 12, 2021

    Economic theory varies with every economist.
    Maybe it is time to use a little common sense?
    What was that about not being a borrower nor a lender?
    All troubles caused by governments.
    All madness=their attempts to claw back money ( for themselves).

  22. Stephen Reay
    March 12, 2021

    The UK’s inflation will also rise. The Bank of England expects inflation to rise to 2.1% and then to fall back to 2% over the next 4 years. The bank said that they will not increase the base interest rate from its current .1% until slack in the economy it taken up. It will be many years before the interest rate will rise, and once again it will be savers , employees from the private sector who’s wages will be held back and people buying homes who will pay more due to increased demand because of low interest rates.
    Low interest rates didn’t solve the financial crash last time and they won’t this time. Sir John is correct we need to increase demand , through investment and lower taxes . This government will invest, but will not lower taxes, we need someone at the helm will not follow the same old treasury script of raising taxes
    QE isn’t the solution it didn’t work last time and it won’t work this time ,if it did then we would have needed low interest rates.

  23. Denis Cooper
    March 12, 2021

    I see that we have sent somebody to Washington to try to counter EU propaganda:

    https://euobserver.com/tickers/151216

    I’m all in favour of that, but I have to say that I think it will be difficult to sell a

    “We signed up to this treaty a few months ago but now we have changed our minds”

    line to US politicians, who may ask why our Senate (House of Lords) didn’t veto it.

    Meanwhile there is also an EU appeal for greater trust between the UK and the EU:

    https://euobserver.com/tickers/151209

    which does not mention who started the

    “We cannot trust the British”

    meme, which unfortunately has now become a self-fulfilling prophecy.

    From February 2019:

    https://johnredwoodsdiary.com/2019/02/08/the-eu-talks-are-not-going-anywhere-lets-table-a-free-trade-agreement/#comment-994295

    “It may be recalled that last summer Prime Minister Theresa May proposed a daft scheme under which the UK would continue to collect customs duties on behalf of the EU, even after we have left.

    Which proposal M Barnier rejected on the grounds that he could not trust us to do it properly, once we were no longer “subject to the EU governance structures”.

    As pointed out at the time, that raised a serious question about whether the EU would trust us to keep to any agreement, unless we accepted continued supervision by the EU institutions.”

  24. Mike Wilson
    March 12, 2021

    Sorry, off topic. I have just received a census form.

    Talk about Big Brother is here! Your government seems to want to know everything about us, Mr. Redwood. I am surprised they didn’t ask how we vote – they have asked pretty much everything else you can think of.

    Why does the government think it has the right, by law, to demand what qualifications I have. It asks if I did an apprenticeship. Who knows? I was an ‘indentured trainee’. Was it an apprenticeship? Not in the traditional sense. And, anyway, I did not complete it. How do I answer that question?

    I have residual income from a software project I was involved in. I don’t work for the income – am I self employed? Or is the same as receiving dividends? I don’t know. What do you think?

    I thought a census was a list of people and where they were on a particular day. Not any more. Now it is every bit of information about you – including medical stuff.

    I have a good mind to go out on my boat on the 21st.

    1. a-tracy
      March 13, 2021

      I agree Mike, there are plenty of qualifications not covered such as the IOD Directors Diploma doesn’t neatly tick a box. As you say people got to within six months of their four-year apprenticeship ending got offered a job and took it for security because they saw too many of their mates get the certificate but no job! but then they didn’t get their final qualification ‘certificate’.

      They say the public sector has better qualified staff but the public sector qualify a lot of their staff post employment on the job for free in house and the staff get paid and rewarded for taking these qualifications which is great but it is the taxpayer paying for all these bits of evidence paperwork to say someone is doing their job. If the private sector was as grandiose to its staff it would go bump. The public sector is often a monopoly without choice of the user, we can’t use a different council, we can’t use a different school, in the private sector you push prices up too high and you shrivel.

  25. Christine
    March 12, 2021

    Western Governments are preparing us for the introduction of the Universal Basic Income (UBI), furlough is just the warm-up act. To stay in power and introduce their wealth transfer policies, I mean the Green agenda; they either have to buy off the electorate using UBI or remove the democratic vote (EU route).

    There are many enlightened commenters on this site who can see what’s going on. Keep up the pressure to get the message out before it’s too late.

  26. Nick
    March 12, 2021

    The last thing the government here should do is parachute money onto the public, as they will simply spend it on foreign imports. It would just create jobs abroad and help our economic enemies instead of us. No, what we need is an intensive focus on government spending on promoting reshoring and import substitution. Why wasn’t Ineos, for instance, offered financial help to build its new off-roader here in the UK, rather than in France?

    The government needs to get serious about state aid and supporting British companies – or, at least, companies willing to manufacture here. That’s why I am so disappointed that the 130% ‘super-reduction’ does not apply to new buildings (or to R&D, where we lag badly behind all our largest competitors). And that’s why the increase in corporation tax to 25% – DOUBLE that of our closest competitor (Ireland) – is the equivalent of slashing our own wrists. It will discourage companies from moving to the UK or investing here. You must get this policy reversed – but it’s no use waiting two years to do so, as corporate spending and investment decisions are being made NOW.

  27. wab
    March 12, 2021

    “The Democrats have just narrowly passed a huge stimulus package, opposed by every Republican as too large.”

    Funnily enough, the Republicans were happy to vote for two fairly large stimulus packages in 2020. The difference this time? There is a Democrat in the White House, and the number one aim of Republicans now is to make the economic situation worse, not better, because they think it makes the next election easier to win. The Republicans only counter offer was a joke. And fortunately the Democrats told the Republicans to get lost.

    Also, not long ago the Republicans were happy to vote for a massive tax cut for the rich which resulted in a huge increase in the deficit. So cry me tears when they and people like Redwood pretend to care about the deficit. What Republicans don’t like is money going to ordinary people instead of to the oligarchs.

    Reply I did not state a view about the deficit

  28. David Brown
    March 12, 2021

    I guess with that much borrowing by the US, the country will in effect own the banks. I am a believer in live for today and spend for today don’t save.
    Interesting about the UK exports to the EU, so far Brexit is having the opposite effect to what we was promised because the EU is still freely importing into the UK and having bonanza. The UK balance of payments with the EU will be worse than staying in the EU.
    I firmly believe the day of reckoning will come and the UK will have to either align more closer to the EU or go into the Customs Union that I favour.

  29. jon livesey
    March 12, 2021

    The recent price action in Gold and Silver suggests that even notoriously conservative “gold bugs” don’t see excessive inflation in the US as a result of stimulus. This makes sense if you consider that inflation is caused by too much money chasing too few goods. An economy that can quickly increase production to soak up new stimulus money will see less inflation than an economy that cannot. In fact, in an economy that cannot increase production quickly, additional stimulus money will always go into inflation and/or imports – it stimulates consumption, but not production. This is an argument for the UK Government to reduce overall stimulus – while helping the lowest income households through the existing benefits system – but increase investment in software, AI, aerospace, bio-tech and other exporting industries. I doubt even the best efforts of the EU can sabotage UK exports in these areas.

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