Quote from: petejh on September 24, 2022, 05:34:34 pmNot as far as I'm aware no.I was wrong, finance bill to be voted on in the commons either just before or just after the new year. Still think the markets will puke so much next week that it gets shelved.
Not as far as I'm aware no.
Kwarteng's intelligence is rather a moot point, given that it is entirely in thrall to his ideologyThe strength of this ideological commitment is captured in this from the Telegraph's Allister Heath: “This was the best budget I have ever heard a British chancellor deliver. The tax cuts were so huge and bold, the language so extraordinary, that at times I had to pinch myself to make sure I wasn’t dreaming, that I hadn’t been transported to a distant land that actually believed in the economics of Milton Friedman and FA Hayek.” To wake up in a land ruled by Friedman and Hayek really is their dream (quote via this article in the Guardian because of Telegraph paywall: https://www.theguardian.com/uk-news/2022/sep/25/great-divide-pundits-reactions-to-mini-budget-run-from-alarmed-to-delighted).Will it work? I doubt it, but what do I know? What I do know is that the utter conviction that tax cuts for the wealthy are the only true and sure route to growth is completely misplaced.
This is quite good on exactly those arguments Toby (paywalled: I managed to read it once but am now locked out): https://www.thetimes.co.uk/article/know-your-history-liz-truss-you-cant-do-thatcherism-twice-wx6w208qk
Still think the markets will puke so much next week that it gets shelved.
Starmer’s alternative plans for green energy, as laudable as they are, will fall flat for most people and their priorities and reinforce that he is out of touch.
Hard to know how it will play out given that historians still debate the effect of such measures in the past. It’s a risk, but I think being seen to do something major for the economy at the moment with all that is going on is good for the animal spirits of the various financial markets and consumer confidence (and spending) to head off spiralling into a bad depression due to knock on negativity. I was pleased to see some tax breaks for business investment but had to scroll a long way down a report to find them. Starmer’s alternative plans for green energy, as laudable as they are, will fall flat for most people and their priorities and reinforce that he is out of touch.
With their backs to the wall and the immediacy of very personal short term threats of rapidly rising bills, interest rates and reducing prospects will push longer term global climate change concerns lower down the personal agenda of most voters. Personal opinion.
This is quite good on exactly those arguments Toby (paywalled: I managed to read it once but am now locked out): https://www.thetimes.co.uk/article/know-your-history-liz-truss-you-cant-do-thatcherism-twice-wx6w208qkTL:DR - circumstances were very different. An additional argument is that both the US and UK had much more scope for economic restructuring as they entered the 80s than they do today. Both Reaganism and Thatcherism produced booms, after a lot of pain, but questions remain about the long-term effects and benefits of those booms.
With their backs to the wall and the immediacy of very personal short term threats of rapidly rising bills, interest rates and reducing prospects
Sounds like they are scrapping one of the few positives of Brexit too - the environment land management scheme. This was due to change subsidies to a nature-based approach and has had a huge amount of effort to get ready. It’s crazy that so many of the things being reversed have been developed by their party (and probably voted for by them!).
Hard to know how it will play out given that historians still debate the effect of such measures in the past. It’s a risk, but I think being seen to do something major for the economy at the moment with all that is going on is good for the animal spirits of the various financial markets and consumer confidence (and spending) to head off spiralling into a bad depression due to knock on negativity.
I feel like the package has been responded to quite badly by markets, concerned by the prospect of interest rates being driven up. They're going to be over 5%, the new package barely helps household finances, and it basically redistributes money towards the wealthier in society It's a fucking insane budget and everyone knows it. Some people will profit, because they have certain investments. Most people won't. Those who thought they will get through winter now may not as their mortgage payments shoot up. Demand isn't going to increase. Government borrowing will go up as services get worse, not better.It's the worst budget anyone could have delivered and even the Tory backbenchers know it. Its a risk in the same way that shooting yourself in the leg is a risk: you could die or merely be crippled.
The corporation tax cut alone is huge and has potential to release large sums for companies to spend on all sorts of things (potentially including wage increases for staff to keep up with inflation).
I'd be interested in why you think demand won't go up. The corporation tax cut alone is huge and has potential to release large sums for companies to spend on all sorts of things (potentially including wage increases for staff to keep up with inflation).
Businesses will have planned for the increase in their forecasting though.
Quote from: Bradders on September 26, 2022, 08:39:14 amI'd be interested in why you think demand won't go up. The corporation tax cut alone is huge and has potential to release large sums for companies to spend on all sorts of things (potentially including wage increases for staff to keep up with inflation). I thought we had been told by various economists that raising wages to try and keep up with inflation was A Very Bad Thing?
Good post Bradders, I’d hoped to say something similar in response to Wellsey’s somewhat hysterical tone but you put it much better than I would have.
Quote from: Bradders on September 26, 2022, 09:21:36 amBusinesses will have planned for the increase in their forecasting though.Have they planned in a very real risk of the pound hitting parity with the dollar soon (where many consumables, like oil, gas and fuel, get priced)? Is it sane to put in the biggest budget changes in my living memory as a fiscal event with no OBR forecast or proper Parliamentary scrutiny? Is it sane to put growth full on the accelerator at the same time the BoE is hard on the brakes on inflation? When the market reacted badly was it sane to promise even more tax cuts are coming? How 'in' does a lack of sanity need to be?