There are plenty of independent forecasts around for those interested. No government is exempt from scrutiny, criticism or alternative views and rightly  so. The problem is knowing if any of the independent forecasts are going to be right.
I understand why the government wanted the OBR to offer a new forecast when it has seen the spending plans and the growth measures of the new Ministers as well as the tax cuts. Â As revenues, GDP and deficits are very sensitive to whether there is growth or not one needs to form a forecast with all three crucial elements of policy.
As I have pointed out in the past the OBR has in recent years been very wrong in its forecasts. It greatly exaggerated the deficits in the last two years when I queried its view when the budget occurred. Last year it overstated the central government deficit by ÂŁ131bn which lay  behind Mr Sunakâs tax rises. They also wrongly said inflation would stay around 2% until 2025. This year I said I thought their ÂŁ99bn deficit forecast would be too low, as it clearly will.
I hope any new forecast they make will try to improve on the last two years. I will continue to look at a range of external forecasts and interpret  them based on recent data and trends.
October 1, 2022
Another day, another attempt by J Redwood to distract attention from the failures of this government. The issue here is not whether the OBR is wrong. The issue is that Truss/ Kwarteng refused to allow the OBR to publish a report on their plans. Because they were frit. And what happened? The markets savaged Truss/ Kwarteng far more than the OBR ever could. Utter shambles of a Conservative government
October 1, 2022
Why would anyone want a report from a body which is entirely wrong in its predictions?
Cassandra it ain’t…her predictions were right but not believed. The OBR is wrong but believed. Yet another useless quango which should be dissolved.
October 1, 2022
You can’t have a proper “budget” without an OBR report, it’s in the rules. The OBR was invented to take the blame if the budget got it wrong. The OBR’s job is equivalent to “drawing to the inside of a straight” in Poker.
October 1, 2022
Stay in line for who acorn, public sector defined benefit pensioners at the expense of the majority yet again?
October 1, 2022
âWhy would anyone want a report from a body which is entirely wrong in its predictions?â Why indeed? This especially one at taxpayerâs expense. But look at all the climate & other duff predictions from the many climate alarmist âexpertâ organisations and âcharitesâ. Have any been right yet?
October 1, 2022
Many people would argue that they have been exactly right. I heard the other day something about record melting of glaciers in Switzerland.
Now I donât know who is right or wrong. The literally thousands of climate scientists or you. You are convinced, for some reason, that you know better than them. Iâm not so sure and am happy to hedge my bets by supporting renewables – if they ever find a way to run a grid on them.
October 2, 2022
I am not against ârenewablesâ but let them compete in a free, unsubsidised and an un-rigged market.
October 2, 2022
“Many people would argue that they have been exactly right.”
No right thinking person could thing that if they looked at the history of the total drivel they have pushed and the actually climate records.
October 1, 2022
OBR has ‘Responsibility’ in its misleading title.
Office of Budget Roulette would be more accurate.
October 1, 2022
But people don’t really trust that Ms Truss or Kwasi are able to do their job any better than the kind of people you would find in the OBR whether it is a quango or not.
If Ms Truss / Kwasi had set up their own company in the past, from scratch, using a business plan, and creating say a high quality tech brand, requiring high skilled workers, with sophisticated R&D and marketing and advertising, exporting abroad, and employing say 50 to 100 people, then people would take them a lot more seriously (even far more seriously than if they had an academic degree in economics from Cambridge / Harvard or worked in some senior finance job but where they weren’t actually the boss / leader). But they haven’t done that. What qualifies them to be beyond a certain level of scrutiny?
October 1, 2022
Sunak, although far from ideal, has more high-level experience of economics than Ms Truss or Kwasi.
October 1, 2022
JR, why have the OBR or ONS at all? We have a Treasury and that should mean these two quangos are redundant, get rid of them.
If it is always wrong why has your govt not done something about it? Why does the taxpayer keep paying for incompetence!
I am not sure what is worse the fact they are way off as you write or the useless govt putting up with it at our expense. FFS where is the leadership!
October 1, 2022
Did you read the post? The reason was the govt wanted the OBR to see both the tax plans and the other measures, not just the tax plans.
This seems very sensible to me although I can’t understand why they couldn’t wait and announce the whole lot together. The energy price policy could easily have been announced separately.
October 1, 2022
Yes, I don’t know about the OBR but I predict many more such articles from those on the Right like Sir John.
October 1, 2022
It sounds as though the OBR would have said they didn’t have a clue about the new government’s overall spending plans, so would have placed huge caveats in any report. All a bit stupid and naive of Kwarteng and Truss to make a one sided statement but not treasonable.
Their statement should have balanced spending and income not acted like a child in a sweetie shop. It’s that simple.
October 1, 2022
During the Conservative party leadership campaign, Liz Truss said that she would keep to Boris Johnson’s spending plans, so the report could easily have been produced on that basis.
It wouldn’t be the OBR’s fault if it turns out that she wasn’t actually being honest about that.
On a related note, I see that S&P have changed their view of the UK’s outlook from “stable” to “negative”.
October 1, 2022
Only people desperate to savage this government would ask for forecasts when half of the necessary information is missing. It needs to see what HMG is doing on the spending side.
However Truss before she was confirmed as PM did say that she would maintain Borisâ spending levels so with only announcements made on the giveaway side of the ledger, it confirmed to the markets her economic stupidity/naivety.
We now read Karteng desperately trying to tell us he will start to get debt down in 5 years and departments looking for savings now (welcome back austerity accusations).
No one believes him, more kicking the problems down the road. Charles Moore surely right. Government/Institutions have got us into this mess. Blithely they sail on, we suffer.
October 1, 2022
Nig1 you can keep spending levels but spend smarter with better outcomes. I see people and their wasteful spending, cranking up credit card debts for a short term impulse buy they later regret.
I wouldnât keep importing fully qualified nurses if what I required on bed blocking wards was more auxiliary care. I think ending SEN nursing was a mistake, I know a lot of fully qualified nurses that trained on the job, took extra qualifications in their speciality area of nursing be it mental health, elderly care or paediatrics.
Covid taught us that you donât need a fully qualified nurse to deliver for eg. flu vaccines, just one person nearby to look after the low % of people that have a bad reaction. Doctor training could be stream lined into specialities. As I said before ânurseâ title puts off male applicants and I believe we need a lot more men in the profession, men push up pay rates for all, donât need as much time off and donât want to work part-time as much as women once they start their families giving more working hours available to get the waiting lists down.
October 1, 2022
@Gary Megson
“The issue here is not whether the OBR is wrong.”
If the OBR is regularly wrong then there is no point in its continued existence… so whether the OBR is wrong is certainly one issue. There are other issues which will become clearer over time.
October 1, 2022
It actually matters if the OBR is wrong, because taking its advice has consequences for the whole country. Double digit inflation, for example.
October 1, 2022
Good morning.
Does anybody take these organisations and their predictions seriously ? If they do, more fool them. But one prediction that the government itself should be predicting, with some accuracy, is its own spending. And armed with such knowledge it should therefore be able to cut its cloth accordingly and not have to borrow.
Or is that too much to ask ?
October 1, 2022
The pound is back above mini budget levels.
I think the markets should be watching the Euro as that’s about to tank.
October 1, 2022
its been tanking for ages, not helped by UK trying to extricate from shoring their budget up for years,
October 1, 2022
MB,
“Does anybody take these organisations and their predictions seriously ?”
Of course they do -even if most know little about them.
That is why counter arguments and full justifications for proposed policies need to be in place.
Otherwise there is the sort of backlash in the media we have just seen
October 1, 2022
The OBR have a dreadful reputation for the accuracy of their predictions. But are they even trying to be accurate? The treasury likewise.
âTrussonomics is already slaying the demons of stagflation. We need more of it
Contrary to received opinion, the outlook is positive: stable inflation, moderate interest rates and much higher growthâ
Patrick Minford in the Telegraph today is correct but we certainly need far, far more of it and quickly. We still have appalling tax rises in the system due to all the frozen allowances in a time of high inflation deliberately caused by the tax to death manifesto ratter and currency debaser Sunak.
Deregulation, ditch net zero, ditch IR35, reverse the attacks on the self employed and landlord/tenants, cut out the vast government waste, simplify and cut taxes, increase the incentives to work relative to a life living of the backs of others, relax planning, ditch HS2âŠ
It is also way past time to ditch the ineffective and dangerous Covid vaccines and certainly for under sixties.
October 1, 2022
+1
October 1, 2022
I agree LL, most especially the so called vaccines.
Don’t forget the bonfire of the quangos, probably the only good idea from Cameron, never implemented.
October 1, 2022
That bonfire never started, those that could are still rubbing sticks together.
October 1, 2022
Well he ratted on âI am low tax Conservative at heartâ, his âcast ironâ Lisbon referendum promises, his promise to stay on and deliver the EU section notice the next day rather than abandon ship like a petulant childâŠ
October 1, 2022
LL :
And Cameron ratted on his promise to reduce immigration to “tens of thousands per year”.
Perhaps he was only referring to cross Channel illegal immigration ?
October 1, 2022
It will be bigger than the circa 5000 cases of UK Contaminated Blood Scandal so will compensation take 40-50 years for the damages for these rather ineffective and now it seems rather dangerous vaccines sold on what seem now to be blatant lies, threat of job losses and other coercion.
“Sir John Major calls contaminated blood scandal ‘incredibly bad luck’ Former prime minister Sir John Major has described the contaminated blood scandal as “incredibly bad luck”, drawing gasps from families watching him give evidence under oath to the public inquiry into the disaster.” will this be Boris and Whitty in 30+ years time!
Mr Whitty why exactly did you overrule JCVI over vaccines for children who were never at any real risk anyway?
October 1, 2022
Patrick Minford out of step with many, albeit I hope he is right, but aligns with your views so must be correct.
And in other news I see Sir JR claiming the rise in the value of the pound is due to support for the tax policies but when it falls, it is always due to the influences on other currencies.
October 1, 2022
He is indeed surely correct and am certainly not always correct. I was conned into taking the ineffective and dangerous Covid vaccines for example (by the lies on safety and effectiveness plus travel & other government coercements & restrictions). Plus I should have moved away from the oppressive tax system in the UK earlier than I did. I even bet on Boris to be PM 1st time when Gove knifed him and he foolishly backed out – why he would have won anyway? I nearly got bankrupted by John Majorâs ERM too I did not think even john Major was so moronic as to handle the fiasco so appallingly with his 17% mortgage rates.
October 2, 2022
‘I was conned into taking the ineffective and dangerous Covid vaccines for example’.
so what happened? Apart from feeling a little p***k what ensued?
October 1, 2022
1949…Erhard, West German Finance Minister abolishes all price and wage controls.
Lucius Clay, Governor of West Germany calls him in and says “My advisers tell me what you have done is a terrible mistake”
Erhard replies ” take no notice…my own advisers tell me exactly the same”
Result…the German economic miracle…
October 1, 2022
+1 and look at at history of the economy of Hong Kong.
October 1, 2022
LL,
Four out of seven posts today. “…in The Telegraph today” moving up the Lifelogic Bingo charts
October 1, 2022
A united Tory party can still convince voters – the Telegraph Leader today.
A Tory party united behind Tory policies would be very nice indeed for a change.
October 1, 2022
Indeed, getting tedious
October 1, 2022
You must be doing a good job Lifelogic.
You are attracting trolls.
October 1, 2022
+1 No one is forcing then to read them?
October 1, 2022
It’s the usual lefty attempts to stifle what anyone says that they disagree with.
Keep saying what you believe in.
October 1, 2022
The real problem isn’t the OBR but a lack of qualified people in the Tory party to run the economy (Liberals worse and Labour even far worse). The real question is how do we attract higher quality Tories into the party to run our country for us? Then people wouldn’t be so anxious about what the PM or Chancellor are going to do next.
October 1, 2022
PLUS a lack of sensible qualified people to run the energy policy, the criminal justice systems, the border force, the universities, schools, NHS, transportâŠ
October 1, 2022
Agreed.
If one is going to pump squillions into the NHS, for example, it really needs someone qualified to run it. Otherwise, loads is going to get / is being wasted like the leaking water in our national water pipes / pipelines …
October 1, 2022
I don’t want to pick on Amanda Pritchard. I don’t know anything about her. I meant NHS leadership in general – not her specifically.
October 2, 2022
Amanda Pritchard (modern history Oxon) in one of her first actions claimed “We have had fourteen times the number of people in hospital with Covid than we saw this time last year and we have also had a record number of A&E attendances and indeed a record number of 999 calls.”
This was complete and utter drivel. The data on Covid hospital admissions in England showed the number of people in hospital with covid is significantly lower than last year. Under her they are still vaccinating children which clearly does far more harm than good. No one and certainly under 50 should be getting them. Truss should like the Danish government stop all the net harm vaccinations now.
Official government statistics for Nov 2 show 7,510 in hospital, compared with 10,397 the same time last year.
October 2, 2022
Mostly mates, chums, private school friends – friends of friends. The ‘right’ sort of people !
October 1, 2022
Food labels could tell you how much exercise is needed to burn off that slice of cake to deter over eating – suggests a study from Loughbrough University.
But currently the Governmentâs Dept. of Transport still (quite erroneously) claims (or just lies perhaps) that walking and cycling produce no CO2 direct or indirect. Actually one typically has to eat about 0.1 KWH about 86kCal extra (to fuel a 1 mile walk). A car can do a mile on only about double 0.2kwh. But human food often takes 3-20+ times as much energy to product it.
So a full efficient car easily be 6+ times more efficient than walking in energy and indeed CO2 terms. Rather quicker too. Not that CO2 is problem anyway. But it show just to show how dishonest the Gov. net zero agenda and war on motorists.
October 1, 2022
There’s your solution – net zero via a population cull. When’s it going to catch on?
Check definition of irony before going all wokey-cokey on me.
October 1, 2022
CO2 is vital for life it is not a serious problem anyway.
October 1, 2022
Population cull is happening in the UK, birth rates down to 1.65, death rates up in the past two years courtesy of covid and related untreated conditions it is ongoing.
October 1, 2022
The death rate is a long way up even without counting Covid deaths, a-tracy. And fertitility is down in this and other European countries. It is looking as if risks were taken in the Covid response which should not have been permitted by our Medical and Health products Regulatory Agency (and by its US and EU equivalents). This must never be allowed to happen again, and those responsible must answer for what they did.
Policy must surely follow a precautionary principle in public health, and I believe the same should apply to public finance. This blog took a very critical look at Sunak’s tax rises in cost/benefit terms. I would like to have seen something similar regarding the current budget measures.
October 1, 2022
You sound like Ebenezer Scrooge.
October 1, 2022
If God had deemed that minimisation of CO2 exhalation was crucial he/she would have evolved us with wheels.
October 1, 2022
Well the barriers to wheel-building in evolution are such that no creature has yet evolved wheels. Wheels have to be able to rotate freely around an axis. This means an organism has to grow the wheel, then somehow detach from it so that it can spin. It then has to keep the wheel supplied with power/blood? to make it rotate in some way, and maintain it as it wears away and perhaps some form of braking too. Also on uneven muddy/rocky/boggy ground are wheels as effective as feet or flying. Wheeled suitcases werecinvented in 1970 but were they very useful before we had lots flat tarmac or paved paths, large airports and railway stations?
October 2, 2022
Take DNA chirality :the chain continues : it sweeps up mutations in is infinite journey . It corkscrews and the chain continues. There is no beginning and no end.The circle although infinite in its geometric representation still has barriers and one axis . This is man’s narrow perception.
October 1, 2022
The average Brit carrying 2st excess of lard with 132kWh of energy can therefore walk 1,320 miles without taking on more fuel.
If said Brit instead died of a heart attack, caused by poor diet/lifestyle, his decomposition would break down the fat to produce CO2 all the same, so it may as well be put to good use.
October 1, 2022
Much truth in that alas.
October 1, 2022
A car that does 0.2 kWh per mile, that’s about 48
miles per litre. A litre of petrol is about 9.6 kWhs. The latest EVs can do 0.25 kWh of battery capacity per mile.
October 1, 2022
You can design a car to go at cycling speeds 15 mph that would only use about 0.1KWH per mile and that is for 5 people.
October 1, 2022
Compare costs of fossil fuels and electricity per mile and we are getting towards parity acorn.
October 1, 2022
You are aware that ICE vehicles don’t just emit CO2, right? They will typically produce nitrous oxide, methane, flourohydrocarbons and other particulate matter as well.
That’s apart from the health benefits of being active by walking rather than going everywhere by sitting on your backside.
October 1, 2022
Peter P. Yes I’m sure at 66 I’d like to walk 9.5 miles each way to my local.town or 6 miles each way to me GP or 10 miles to my dentist. We have one bus an hour. Nothing after 6pm. Nothing to mu doctors surgery. Let’s get real.
October 1, 2022
Totally agree FuS
October 2, 2022
you need to move !
October 1, 2022
Walking is where we came in a century ago.
I might need to travel to a place thousands of miles away to attempt a business deal that creates real benefis for hundreds of people
You going to stop me Peter?
October 1, 2022
One has to ask the question is the OBR (like a lot of quangos) really fit for purpose?
When all their forecasts are so terribly wrong and sending the wrong signals to investors and financial markets who is held responsible and accountable?
If it is possible for our host to come up with more realistic forecasts, then the suitability of those employed by the OBR must be questioned.
A lot of big companies have gone down on the performance of their financial advisors. Is it so hard to learn from others mistakes?
Whatever the OBR is costing the tax payer it is not value for money.
October 1, 2022
Nice post Turbo.
October 1, 2022
Daniel Hannan: âNo, the pound isnât crashing over a trifling batch of tax cuts. Itâs because the markets are terrified of Starmer.â
Indeed, but worse still a Starmer/Sturgeon/Davey Gov. and they certainly should be very terrified of this. Dan is usually quite sensible though – but even Dan seems to have fallen for the mad war on plant, tree and crop food. A history degree and no science beyond GCSEâs I assume.
October 1, 2022
Also hit the markets is the serial gross incompetence of recent Chancellor’s starting with John (ERM fiasco) Major. Surely suffering the serial economic incompetence of Major, Brown, Darling, Osborne, Hammond and the dire Sunak is quite enough for any country to suffer? 33 years of big state, over regulated, climate alarmist socialism.
October 1, 2022
Well said, LL. No party is immune, but the CONS brag about their fiscal responsibility. Where is it?????
October 1, 2022
Fiscal responsibility that would be nice for a change but you can only really have this if they stop the endless government waste and misdirection of spending. The state only do the rather few things that governments need to do. Law and Order, controlling the borders, defence⊠and not really very much more.
October 1, 2022
You are obsessed with qualifications tens of years previous. You have zero knowledge of what learning has been acquired in the intervening years. Indeed I have far more of both plus experience now than ever I had in my early 20s.
October 1, 2022
Yes but the types of people who were good at and enjoyed science, physics maths at school are not usually the same types those who liked languages, classics or similar. A few are good at both I grant you. Some can learn lots of facts but not actually âthinkâ. They rarely change much. I am still fairly useless at foreign languages though I did just about get my French O level C – as I had to to get in to Camb. to read maths and physics.
October 1, 2022
It usually a good indication the type of thought processes they have. Some (like for example Jacob Brownowski, Freeman Dyson, Bertrand Russell, Richard Feynman⊠I agree have an ability to cover both well. But they usually come from the Maths, physics, science side initially I find.
October 1, 2022
The sort of person who aspires to read Politics, grievance studies, history of art, Theatre, Art, Classics or Media Studies is rarely very similar to one who aspires to maths, physics, engineering, chemistry.
October 1, 2022
If this nonsense were true, the markets would have reacted negatively to the poll published on Thursday that Labour has a 30% lead. Labour may not be your choice but there is little evidence that they act very differently to the Conservatives, when in power. For example the light touch of regulation that contributed to the 2008 financial crisis was something the Tory opposition wanted to go further.
October 1, 2022
very often History can be a good guide for expecting a result from a course of action.
October 1, 2022
Delusional rubbish. The markets don’t react like they did based on what might happen in 2 years time, they react to what happening now.
October 1, 2022
Not at all, they are often deciding on gilt and bond rates and pensions for 5,10,20 or 30+ years hence.
October 1, 2022
The markets reacted to Kwarteng’s statement. I’m seeing it reported in the media that Kwarteng was told in advance what the market reaction would be to what he had to say and, knowing that, he went ahead anyway. That smacks of srrogance and recklessness.
October 2, 2022
Look at other nation’s currency falls versus the strong US Dollar over recent times Peter.
The Euro also falling yet no mini budget.
October 2, 2022
and often row back inside 2 days! The difference (margin) being the profit.
October 1, 2022
Oh, honestly. Take SOME bloody responsibility.
If it wasnât the LAT Labour government itâs fear of the NEXT one. Itâs pathetic. The country is in a mess. The Tories have been in power since 2010 and, since 1979 have been in power for 30 of the last 43 years. Wait, donât tell me, it was the Lib Demâs fault.
Take the blame!
October 1, 2022
Have they published their computer models?
I should be able to download it and run it.
If not then it has zero credibility.
October 1, 2022
Computer models are never more accurate than the data fed in. As the future is so uncertain, so also must be the predictions.
I make a prediction that if the government reins in waste, the fortunes for the country’s finances will be very good.
I also make a prediction the government will continue spending and wasting.
Ultimately, I guess there will be a time when the weight of debt creates worldwide defaults and the whole credit/debt system collapses.
October 2, 2022
Javelin, Go to obr.uk âOBR macroeconomic modelâ The 21 July 2021 version is downloadable.
Download it, run it ⊠Go ahead, make my day
⊠and do not forget to let us all know of your results and conclusions.
October 1, 2022
We don’t need ‘hope’ we need truth. A truthful analysis. A reversion to fiscal truths is badly needed. If costs exceed income over time then bankruptcy is guaranteed and democracy is threatened. Why is this so difficult to understand? Yes, this simple message would be fiercely unpopular with those who feed off higher State spending like rats on a carcass but if policy is being decided by what is best for party rather than nation then it’s game over anyway.
If a Labour-SNP coalition gain power the effects would be catastrophic for law abiding, silent majority. Freedom as we know it will be destroyed. They will employ the full gamut of Marxist, Maoist and Critical Theory ideology to unleash upon us all and our children.
John composes his articles and we appreciate his blog but he doesn’t go far enough, nowhere near far enough. Maybe when he retires and gets down to pouring out his memories onto page we can all gain access to what he really believes
October 1, 2022
A car that does 0.2 kWh per mile, that’s about 48
miles per litre. A litre of petrol is about 9.6 kWhs. The latest EVs can do 0.25 kWh of battery capacity per mile.
October 1, 2022
A country can’t go broke in its own fiat currency. There is nothing it can’t afford to buy that’s available for sale in its own currency. Countries can go broke using other countries currencies, if they borrow in them or depend on them for essential imports.
October 1, 2022
Hilarious acorn
Magic money…
Make me a millionaire.
October 2, 2022
A number of countriesâ economies have failed or been put in a difficult situation because they have a major or sizeable part of their outgoings to be paid in another currency, often in US$, often paying for energy.
I wonder who is the one hilariously out of their limited thinking range.
October 2, 2022
So endles magic money is OK for you too heffy.
No surprise there.
PS
Got your sarky abuse in at the end as usual I note.
October 1, 2022
Another brilliant post Dom.
October 1, 2022
+1 I will certainly buy it.
Being one of a few of the sound MPs does rather constrains him. He does however suffer rather from being an Oxford Arts Grad. but does exceptionally well despite this handicap.
October 1, 2022
Sir John deserves much credit forwarning accurately and so often of our national group-think doom-mongers, doom merchants and negative headed by the OBR, Treasury, BBC and MSM and most certainly the Red Flag brigade posing as the Labour Party.
Whilst they play the song “Things can get better” playing scornful on emotions of people for votes they really pursue the exact opposite hidden agenda to make us all poorer and hold us captive to their idea of a fairy tale economy instead that always ends badly.
October 1, 2022
+1
October 1, 2022
Once again I guess you are getting your retaliation in first on the basis you are not expecting good news from them.
If it is positive I am certain you will not be highlighting previous inaccuracies. Abolish them or stop complaining when you do not like/agree with their calculations.
Actually if HMG can get rid of Tom Scholar, do the same at the OBR and you could take over?
October 1, 2022
When I worked for large commercial organisations, it was perfectly normal that when new top-level management
(or owners) arrived, they would turf out any senior managers who clearly didn’t have views or policies that aligned with their new bosses ideas and programmes.
I must admit, I don’t really believe all this “the Civil Service is neutral” stuff. Everyone has their own ideas, practices and beliefs, most especially at the top. This turnover happens all the time in industry and frankly, it should happen a great deal more in the public sector too or how else do you clear out the dead wood?
October 2, 2022
+1
October 1, 2022
Prediction, UK crippled in two year. Krasny Liman, line in the sand.
October 1, 2022
Prediction – what ails the UK also infects the rest of the World, including the US.
We are not alone in this hole and the sooner everyone stops digging, the better.
As for Krasny Liman, I’m very happy that I’m not Russian – or Ukranian for that matter. I served my time in Germany and fortunately I never had to fight. I don’t envy anyone who finds themselves forced to do so.
October 1, 2022
As the vast agglomeration that is the Shanghai Cooperation Organization (it’s full and associate members already speak for around half the world’s population-with a queue of would-be members) increasingly coalesces,the west is going to be squeezed out as intermediaries in global trade;since the dawn of time it has been the case that middle men make most of the profit in trade,be it the Sogdians on the Silk Road through central asia,the Persians on the silk trade from China to Rome or the Venetians and Genoese in the Black Sea and Levant or,indeed,the British Empire.Biggest loser will be the UK,not least because it has tried to disrupt the integration process and therefore has excluded itself from it.Hence,the absolute desperation of it’s involvement in Ukraine (for access to the Black Sea) and a revival of the old,failed intermarium project.
I see France is losing another of it’s central African former colonies to Russian influence.A coup has ousted the French-backed leader of an earlier coup;lots of Russian flags alongside the national flags in the crowds this morning.A vast arc is developing from the Pacific coast of China and Russia through central Asia,with one arm stretching south across the Caspian(effectively a Russian-Iranian lake) through Iran and the Gulf with connections to India.The other arm stretching across the Black Sea,from the north east to the Turkish Straits(Turkey has said it would like to become a full member of the SCO(despite being in NATO)and will increase it’s security cooperation in the meantime) and across the Med to Egypt and then central Africa.
Egypt(a new SCO associate member)is getting a large Russian nuclear power plant(it’s first;work has just commenced),it’s railstock is being upgraded by the giant Russian producer,Transmashholding,and it’s Hungarian associate(largest contract in the history of Egyptian Railways),it’s banks are connecting to the Russian MIR payments system this weekend and it will soon be issuing international bonds in Chinese Yuan.
The Iranian-designed kamikaze swarm drones which Russia is now manufacturing in quantity under license are causing havoc behind Ukrainian lines and considerable consternation-Kiev expelled the Iranian ambasador last week.SCO in action again!
October 1, 2022
Large elements of the media speak of the OBR and treat it as if it were a superior and perfect organisation which ought to be treated as such by the PM and the Chancellor; that whatever it wants must be provided.
The media feels it can show endless disrespect to the government and I find it frustrating that they are allowed to get away with it. They must be challenged more and strongly. They must be required to justify their claims and attitudes.
October 1, 2022
Me too, the Tories just don’t seem to understand the MSM , especially the BBC are the enemy, even more so than the Labour party , for it is the likes of the BBC who are setting the narrative . When being ‘interviewed’ by a BBC presenter , sorry activist, they should treat them as their political opponents, when the BBC presenter tries to score political points, then they should attack the BBC’s position.
October 1, 2022
+100
October 1, 2022
Back in the good old days of George Osborn and his pal the PM who said we would have a referendum thinking none of us would want to turn our backs on the EU ordering us to implement their directives.
To make sure we would not vote to leave.
George, the Treasury and the OBR dreamt up a forecast to frighten us.
So we stop pointing back at their figures the OBR stick to trying to hoodwink us.
October 1, 2022
If the new Chancellor had indeed issued a mini statement instead of most of a budget he would have got away with it.
The markets had priced in the gas and electricity giveaways and the corporation tax and NI roll backs. This could have been positioned as additional borrowing which will be paid for over time by greater growth, hinting that furthervwindfall taxes were possible but not desirable. Not much to argue with there.
Instead he had to add a whole raft of other tax cuts to the package which hinted at a massive trickle down experiment. Fiscally and politically hubristic and naive.
Can’t row back now but it didn’t have to be this way but as your new administration now lacks credibility it needs helping out by another institution that lacks credibility. (And the Bank of England which hasn’t got much right either).
October 1, 2022
If you look at the interview between Steven Edginton and Nigel Farage on 2nd September you will see that Nigel correctly predicted the run on the pound. He is such a knowledgeable, wise person. The government would be far better hiring him as an advisor rather than listening to the failed OBR.
We are heading for riots in the streets if the government doesnât turn things around soon. They need to get a grip on immigration, deal with crime, eliminate woke, return a moral compass to our education system, suspend net zero, protect free speech, control the climate change hysteria, and aim for energy and food security. Truss is deluded if she thinks more immigration is the answer to growing the economy. There is something dreadfully wrong if she canât see all this.
October 1, 2022
No model, but my instinct tells me that when we are still living with the economic aftermath of the pandemic, and we have helped to foment an unnecessary war in Ukraine cutting off usual energy supplies and forcing a massive government intervention, then it would have been better to err on the side of caution and steer a steady course, not loudly announce a programme to radically reshape our economy.
As said before a growth target of 2.5% a year is nothing special, it is just the average since the war:
http://johnredwoodsdiary.com/2022/09/25/the-right-kind-of-growth-needs-the-right-kind-of-freedoms/#comment-1343336
and there was really no need to make such a big deal out of getting back to it.
But then that is what Liz Truss had promised as part of her pitch in a long Tory party leadership contest.
October 1, 2022
Not entirely off topic, I’ve just sent a short letter to the Irish News, as follows:
“In your editorial (today) you conjecture that after a disastrous week Liz Truss may welcome “another attempt to unravel the Gordian knot of the Northern Ireland Protocol”, but as every schoolboy knows all attempts to untangle the knot had proved futile and Alexander the Great resorted to slicing through it with his sword. In the present case Liz Truss is forging her sword through the Northern Ireland Protocol Bill; however the question is whether she would have the courage to use it.”
This is a strongly pro-republican newspaper, but maybe they will print it.
October 1, 2022
The OBR is not the government – it does not reside in No.11 or no.10. and that is the bottom line.
October 1, 2022
I read that a Goldman Sachs based model indicates cost of energy bailout substantially less, maybe by half than the pessimistic Treasury.
The Treasury once again seems determined to undermine your Chancellor/anyone who doesnât worship their âorthodoxyâ
Why do you continue to never running these things through other models and have a rebuttal to the Treasury ready if necessary and why havenât you, root and branch, reformed them.
We see time and time again the Civil Service as an impediment to change, not a catalyst, you know it as well yet your Ministers are too feeble to take them on.
Avoiding/evading responsibility must be near the top of any Ministers skill set.
October 1, 2022
Morning John,
The OBR will be saying A lot of complete and utter nonsense as per usual.
The OBR and IFS will say the tax cuts will have to be “paid for.”
Which means
a) They have no idea how the UK monetary system actually operates.
Or
b) They are a political outfit for the city of London.
There is absolutely no reason whatsoever to bring back austerity because of tax cuts. As taxes do not give the govt more money to spend.
Taxes perform a different job entirely.
Taxes are there to release both the skills and real resources necessary for the government to fulfil its socioeconomic programme. They reduce the quantity of jobs offered by the private sector and therefore all taxes are taxes on jobs.
And Taxes drive the currency.
All political parties will need to tax some people more in the economy to stop the private sector hiring the people the govt need to use in their programme. When we get close to full employment.
The task of duties, levies and fees is to alter behaviours â disfavouring one area and favouring another â or hypothecating a particular cost.
But the OBR and IFS are going to tell everyone the tax cuts need to be paid for. Which is a lie.
As a,spending Bill passed in parliament finds the money ( We issue the damn thing, we don’t use the Euro). The votes to pass the spending bill funds the spending.
October 1, 2022
Given the hoo-haa about all the other good things Kwarteng announced, probably noone would have noticed in the general uproar, if he had gone a step further and abolished the OBR – missed opportunity if ever there was one!
October 1, 2022
âAs I have pointed out in the past the OBR has in recent years been very wrong in its forecasts.â
Of course. The OBR does not see its purpose as issuing accurate forecasts. It is yet another of our institutions demonstrating Robert Conquestâs second and third laws of politics. The only surprise is why the Conservative Governments do not sack this unelected quango.
The Conservative Party and consequently the country is in a financial mess because they have followed communist policies.
Firstly the UN/China/Susan Michie/Imperial College/Labour policy of unnecessary lockdowns and secondly the UN/China/CCC/Labour CAGW/Net Zero policy.
The only way to get out of this Communist driven hole is ditch the CCA/Net Zero and get back to abundant affordable fossil fuel energy. Plants actually need more CO2 in the atmosphere. All life on our planet has narrowly escaped extinction several times over the last 1 million years when the CO2 level dropped to 180 ppm, just 30 ppm above the level below which plants cannot survive. The last time as recently as the last ice age which ended just 11,000 years ago.
October 1, 2022
âI hope any new forecast they [the OBR] make will try to improve on the last two years. I will continue to look at a range of external forecasts and interpret them based on recent data and trends.â
The OBR are like the IPCC.
If the observed, measured data doesnât fit the model, then they say the data is wrong.
October 1, 2022
One of Truss’s ministers has said “Britain has been living in a fools paradise “. Many commentators on this site know it to be correct, many mp’s know it to be right, but keep ploughing on.
Government policies and printing money are to blame for all our ills. Truss’s minister also said we should prepare for austerity, well maybe he hasn’t noticed that austerity hasn’t stopped. The Conservatives are doomed at the next election,you can’t even get good betting odds that they will lose because it’s so certain to happen.
October 1, 2022
The new Truss government have made a start with much needed tax cuts, but more to do.
How about, doing away with all subsidies on renewables and see how they perform in a fair market. How about cutting the overseas aid to emergency and disaster only. How about firing all diversity managers in the public sector. And how about having a real cull of the quangos.
October 1, 2022
I thought it mildly amusing that having been told the City were in a panic about not getting an OBR forecast to help them figure out the implications of the minibudget ( that was after telling us the ÂŁ2billion cut in the top rate of tax was the end of the world budgetary speaking) we got the Office of National Statistics telling us …’you know that recession we told you the country was in, well actually we aren’t’…So one public body can’t tell up from down from historical data, but somehow we must put our complete faith in another’s musings about their future predictions.
Yeah I know GDP numbers are always subject to revision, but that didn’t stop the BBC and its Labour party going hard on those numbers, ‘we’re in recession, we’re in recession’ etc was the mantra, so a bit of payback is due, but what has gone on following the minibudget also gives cause for concern. As I said first we were told it was the ÂŁ2billion 45p cut was what did it, then the lack of an OBR forecast , then the outrageous intervention by the IMF , makes you feel something rotten was going on.
It might have not been a clever thing to have a budget on a Friday when the London market are closing their books and the first pickings were to be had in the thin Sterling currency market on a Monday morning in the Far East, but who was flogging off Sterling down to 1.03 that precipitated the ‘crisis’ ? Then the pension liquidity crisis , wasn’t it Gordon Brown the one who forced the pension funds to hold higher levels of Gilts? And who was FCA Chairman while pension funds were leveraging their Gilts? Andrew Bailey, and who was BoE Governor at the time? Marke Carney, so that might explain his hurried intervention, a bit of backside covering going on perhaps.
As for the IMF , they should not be allowed to get away with their intervention. When you compare our economic numbers with other G7 nations , debt to GDP, inflation, unemployment , growth , we are in the better half of the bunch, not an outlier in anything, so not deserving of their finger wagging. Looking at the background of the head of the IMF, Mrs Georgieva….the Karl Marx institute in Bulgaria, LSE ( at the same time of Von der Leyen), World Bank , EU Budget Commissioner , makes you smell a rat that here is another NGO which has been captured, especially if you read Mrs Georgieva’s thanks to Klaus Schwab at the WEF and her support for the great reset. We have had unwarranted interventions by the UN, the WHO , now the IMF, time to put a stop to it, time to educate them that we are not an easy hit, and that we can bite.
October 1, 2022
The OBR has now taken on almost mythical, oracle like status since the markets did what they always doâŠtry and take advantage of momentum and wait for intervention. Sir John is right to draw attention to their past performance as we look to their next attempt to get anywhere near to accuracy in the next few weeks.
October 1, 2022
It reminds me of the mythical status that other civil servant, Sue Gray, took on – a tool with which to remove a PM.
October 1, 2022
The mini-budget has resulted in a mass hysteria that is arithmetically irrational with many so-called ‘Conservative’ M.P.s adding to the hysteria rather than quenching it.
One can only call it hysteria when around 2 billion pounds, the cost of reducing the cost of reducing the 45p highest Income Tax rate back to 40p, out of around 100 billion pounds extra borrowing is supposed to be the cause of economic and social collapse.
While the Opposition parties might also oppose not raising Corporation Tax from 19p to 25p in the ÂŁ, nobody is opposing the costlier items of cutting National Insurance ans standard rate Income Tax, nor the ÂŁ60billion odd cost of subsidising gas and electricity for homes and businesses (I myself am still not really convinced about subsidising businesses, at least except in the very few cases where fuel costs exceed 15% of their turnover). Even worse, unlike tax cuts which (ignoring possible Laffer curve advantages) have a fixed cost, subsidising fuel prices is akin to issuing a blank cheque (and we are told fuel prices could otherwise reach up to ÂŁ6,000 per average household next year). So how could one expect any OBR report to be accurate with that massive blank cheque around?
I am afraid many Conservative M.P.s seem to be innumerate and ‘snowflakes’ for lambasting Truss for restoring the highest Income Tax rate back down to what it was for over 20 years. In reality overall this mini-budget has benefited the poor even more than the rich. Furthermore the tax cuts are hardly even offsetting increased tax through inflation caused ‘fiscal drag’ that nobody is mentioning.
Unfortunately the failure of Truss and her team to defend even this tax cutting mini-budget at all adequately is further proof that although her present policies are better than Boris Johnson’s, she lacks his political insight, intelligence and skills to the extent that it is he, not her who must lead the Conservative Party into the next General Election if the Conservatives are to avoid electoral disaster.
October 1, 2022
You need to give the OBR some lessons, John.
October 1, 2022
âAs I have pointed out in the past the OBR has in recent years been very wrong in its forecasts.â
How many other quangos and institutions broadcast unreliable data and worthless predictions?
October 1, 2022
As a (general) critic of Trump, i have to eat humble pie when it comes to Trump’s remarks about Germany / Russian pipeline back in 2018. That was great insight.
October 1, 2022
He was also right about the Germnas not paying their way in NATO. Oh how they sneered, about both insights.
October 1, 2022
Thing is politicians going for important public office should first of all be interviewed by a medical board to make sure they are not mentally deficient or are not suffering from early something or other – this applies to me for my job and am sure to many others so why not politicians?
October 2, 2022
Is the OBR now more important than our government
How’s wanging the dog