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    (Original post by Davij038)
    I certainly did sleep easier when I’d paid my debt off, and knowing I wouldn’t have to keep paying off interest.
    Your post demonstrates the economic misunderstanding of not realising that a country's economy operates very differently to household income. A surplus somewhere in the system means a debt elsewhere in the system. Debt is being shifted onto household income.

    People treat a country's economy like their own finances. Here's a wonderful explanation from Yanis Varoufakis

    https://www.youtube.com/watch?v=YZNwdcESn90

    Do you really think this country is a significantly better place to live than it was in 2010?
    Are most people living 'reasonably well'?
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    (Original post by DeBruyne18)
    Misleading headline.

    It doesn't include capital expenditure and it is two years after it was promised.

    You also haven't provided any evidence that we would have grown slower had we adopted a Keynsian model like Portugal did, whose economy has grown far faster than out own.

    I do like the fact that the media have barely touched this story.
    LMFAO, Portugal has had terrible GDP growth so that's not true, and you're trying to compare a G7 country's growth to a medium income country.
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    (Original post by Appleorpear)
    LMFAO, Portugal has had terrible GDP growth so that's not true, and you're trying to compare a G7 country's growth to a medium income country.
    https://www.ft.com/content/cd5642e2-...6-b9ccc4c4dbbb

    2.7%

    Portugal has done rather well economically since adopting a Keynsian approach.
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    What is it and these Keynesian economists around on TSR... 🙃
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    (Original post by Jammy Duel)
    The current surplus/deficit is the important one in that it is the running of the government functions. That overall deficit could be eliminated right now by cancelling all capital spending. Think of it in terms of household spending, your current surplus/deficit would be looking at household income and comparing it to things like bills, food, fuel, etc, overall would be considering things like getting an extension or a new car, TV, etc. Getting, say, a new car you might have an overall household deficit as a one off matter while retaining a current surplus and as such there is no issue here. The most important surplus/deficit figure is current. That does not mean that we should not try to have revenues to cover capital spending NOW as well though.
    Even if the government stopped spending £50 billion or so in capital expenditure it spends right now it would still be in deficit, this is because the governments revenue would significantly reduce as a result because a lot of that spend comes back directly in the form of taxes. You can not expect the government to cut £50 billion and that to have no effect whatsoever on current revenues. Revenues would also reduce indirectly because of the inefficiencies that would arise from the lack of capital spend, most of the capital expenditure is not spent on building brand new infrastructure but maintaining the infrastructure we already have. So capital expenditure includes money spent on repairing and building roads, investing in new equipment e.t.c The NHS for example spends around £5 billion of it's budget on capital expenditure, that counts as government capital spend and that money goes to both operational (maintaining stuff) and strategic capital spending. Education has a capital spend of £5 billion, thats money spent maintaining, upgrading and building new facilities in schools. Defence has a capital spend of £8 billion, thats money spent maintaining the aircraft, planes and nuclear deterrents that keep you safe. Transport spends around £8 billion, this money maintains and upgrades rail and road infrastructure. So your analogy does not fully capture the complexity of the situation.
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    (Original post by CoolCavy)
    Can they stop cutting everything now then.
    no
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    Well Done. After 8 years of austerity and suffering finally something to celebrate, Not!

    This changes absolutely nothing.
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    (Original post by Davij038)
    I certainly did sleep easier when I’d paid my debt off, and knowing I wouldn’t have to keep paying off interest.
    You are not a nation state.
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    (Original post by Jammy Duel)
    Yeah, totally helping your case by calling people fascists rather than giving supporting evidence
    lol, I'm not wasting my time presenting evidence you would just hand wave away.
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    (Original post by DeBruyne18)
    Your post demonstrates the economic misunderstanding of not realising that a country's economy operates very differently to household income. A surplus somewhere in the system means a debt elsewhere in the system. Debt is being shifted onto household income.

    People treat a country's economy like their own finances. Here's a wonderful explanation from Yanis Varoufakis

    https://www.youtube.com/watch?v=YZNwdcESn90

    Do you really think this country is a significantly better place to live than it was in 2010?
    Are most people living 'reasonably well'?
    I like Varoufakis and have seen that episode.

    Obviously, it is different in some ways to household debt but in terms of costs of being in debt the comparison is relevant.

    How is debt being shifted onto households?

    Depends what you mean. I think 1950s Britain was on balance a better place to live in than today.
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    (Original post by DeBruyne18)
    https://www.ft.com/content/cd5642e2-...6-b9ccc4c4dbbb

    2.7%

    Portugal has done rather well economically since adopting a Keynsian approach.
    It has had weaker GDP growth than the UK pre 2017. You can't use one years GDP growth to say a Keynesian approach would be better.
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    (Original post by ChaoticButterfly)
    You are not a nation state.
    I thought they didn’t exist? 😜

    * see my post above
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    (Original post by Davij038)
    I like Varoufakis and have seen that episode.

    Obviously, it is different in some ways to household debt but in terms of costs of being in debt the comparison is relevant.

    How is debt being shifted onto households?

    Depends what you mean. I think 1950s Britain was on balance a better place to live in than today.
    Essentially if we run a surplus it means that the government is taking more money out of the economy than it is putting into it. It shifts the debt from the government to the private sector and households.
    A surplus somewhere in the system means a debt elsewhere.
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    (Original post by DeBruyne18)
    Essentially if we run a surplus it means that the government is taking more money out of the economy than it is putting into it. It shifts the debt from the government to the private sector and households.
    Yeah...

    A surplus somewhere in the system means a debt elsewhere.
    Not necessarily.
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    (Original post by ChaoticButterfly)
    It was toally worth the thousands of deaths it cuased. totoally fixed the economy.
    What a lot of bonkers nonsense. Perhaps you can clarify precisely what window of public spending next year will not make us murderers?
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    (Original post by CoolCavy)
    Can they stop cutting everything now then.
    I'm afraid that's not really how it works. A current budget balance is a good thing and important: we are not borrowing for day-to-day spending, but to invest. But it is not a total budget surplus: we are still borrowing more than we bring in and the national debt is still growing.

    Once we get to a surplus in the actual budget, that's only the first step in actually paying down some of the considerable debt that we have built up and been building up for years. Fiscal constraint has to be a long term commitment that will avoid us getting into this position again.
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    (Original post by L i b)
    I'm afraid that's not really how it works. A current budget balance is a good thing and important: we are not borrowing for day-to-day spending, but to invest. But it is not a total budget surplus: we are still borrowing more than we bring in and the national debt is still growing.

    Once we get to a surplus in the actual budget, that's only the first step in actually paying down some of the considerable debt that we have built up and been building up for years. Fiscal constraint has to be a long term commitment that will avoid us getting into this position again.
    Yeh I get that, we did a quite a lot of economics at history a level (the making of modern Britain) although I'm by no means an economic expert, am quite crap at anything mathsy. But yeh was just wishful thinking.
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    (Original post by The PoliticalGuy)
    Well Done. After 8 years of austerity and suffering finally something to celebrate, Not!

    This changes absolutely nothing.
    Would you care to explain why current account surplus is bad?
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    (Original post by L i b)
    What a lot of bonkers nonsense. Perhaps you can clarify precisely what window of public spending next year will not make us murderers?
    http://www.independent.co.uk/news/he...-a8057306.html
    https://mainlymacro.blogspot.co.uk/2...mortality.html

    If it makes you sleep easier at night you can refuse to consdier it if you like. Actions have consequences, and so do economic policies. Maybe it was worth the sacrfice. But the least you can do is acknolegde those who died as a result as opposed to pretending they don't exist.
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    (Original post by CoolCavy)
    Yeh I get that, we did a quite a lot of economics at history a level (the making of modern Britain) although I'm by no means an economic expert, am quite crap at anything mathsy. But yeh was just wishful thinking.
    Austerity is no where near as respected in the economics community as the mainstream media and poeple like L i b let on. It's arguable a largely discredited position and those that do sing its praises are a minority.

    Just am example from a professor of economics who is a mainstream economist so you can be assured this isn't just hard left wingbattery or heterodox bias.

    https://mainlymacro.blogspot.co.uk/2...-when-our.html
    https://mainlymacro.blogspot.co.uk/2...ke-happen.html

    Austerity, by which I mean cutting public services and privatasing will not stop under the Tories as it is an ideological mission. The notion that it is neutral sound economics is just good politics to get the public to vote fot them. If "austerity" goes out of fashion and becomes a poltcial liability they will try and come up with another framing for and justfication of it.
 
 
 

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