Reply to: New Labour architects of their own downfall

[stackpole]

I'll grant you - that was a good a thing.

If the MPC were truly independent of the government, rates would be going up to control our rising inflation, not going down to win votes from house owners.

[luke warm]

Hang on, I thought your initial post was defending Labour. Have you changed your mind? Yes add to Labour's Legacy the fuelling of an artificial boom based on debt.

Go and read the OP again. That's not at all how it reads to me. More like: 'labour was around for a boom; labour voters got wealthier; labour voters vote tory.'

[Marina]

I'll just point out in passing that Thatcher closed down more grammar schools than all Labour governments put together. I am stunned how people still blame Labour for that, and think that Thatcher was in favour. She had no use for grammar schools after she left her own: every one of her cabinet was public school except herself.

The Tories also started selling school playing fields, although Labour have sold many times more.

(and, no, I'm not a socialist, slagging off the Tories. But discredit where it's due)

[TimberWolf]

I'll just point out in passing that Thatcher closed down more grammar schools than all Labour governments put together. I am stunned how people still blame Labour for that, and think that Thatcher was in favour. She had no use for grammar schools after she left her own: every one of her cabinet was public school except herself.

Yeah but if Thatcher did it, it was probably right

[expat]

social mobility was probably greater than under Thatcher

Au contraire, no other Government has done more to reduce social mobility; By giving people incentives to stay poor via the benefits system, by removing incentives for entrepreneurs and small businesses, by removing grammar schools, by making sure that all graduates finish university in debt etc etc. Making sure that people with brains from poor backgrounds cannot succeed.

Labour and their minions depend on a lumpen proletariat mass in order to justify their cause. It's in their best interests to keep the poor just that - poor. Socialism is inherently evil.

I need a lie down.

I'll just point out in passing that Thatcher closed down more grammar schools than all Labour governments put together. I am stunned how people still blame Labour for that, and think that Thatcher was in favour. She had no use for grammar schools after she left her own: every one of her cabinet was public school except herself.

[malvolio]

I'll grant you - that was a good a thing.

Naive viewpoint. Go look up the CV's of the people who sit on the Monetary Policy Committee, and how many owe their places to HMG patronage. It's probably not meant to be all that independent either, unless and until they get the sums wrong when they get the blame and Gay Gorgon resumes control.

[Bagpuss]

social mobility was probably greater than under Thatcher

Au contraire, no other Government has done more to reduce social mobility; By giving people incentives to stay poor via the benefits system, by removing incentives for entrepreneurs and small businesses, by removing grammar schools, by making sure that all graduates finish university in debt etc etc. Making sure that people with brains from poor backgrounds cannot succeed.

Labour and their minions depend on a lumpen proletariat mass in order to justify their cause. It's in their best interests to keep the poor just that - poor. Socialism is inherently evil.

I need a lie down.

You are half right, for the other bit Labour finished the job the Tories started, Student grants were phased out in the 1990s under J Major, the social security bill increase started under M thatcher and the disability fiasco under J Major, it's got worse, but it's been there for 20 years.

Monetarism believes in a 'natural level of unemployment' whereas Keynesian economics is supposed to believe in full employment. So in theory conservative policies should lead to more unemployment, however, this government are more Monetarist than Keynesian.

[Lucy]

I am not defending Labour, I am saying they presided over a boom which made many people rich. The boom was deliberately fuelled long after it could have been brought to an end. The economy will now start paying for the boom years. Any sensible government would have tried to control HPI much sooner. The new rich will thank Labour by voting Tory, IMHO as was seen in Crewe and Nantwich.

Isn't IMHO one of those 'gay phrases' you get so cross about?

linky

[HairyArsedBloke]

I am not defending Labour, I am saying they presided over a boom which made many people rich. The boom was deliberately fuelled long after it could have been brought to an end. The economy will now start paying for the boom years. Any sensible government would have tried to control HPI much sooner. The new rich will thank Labour by voting Tory, IMHO as was seen in Crewe and Nantwich.

Which they are not; so they didn't.

[Bagpuss]

Hang on, I thought your initial post was defending Labour. Have you changed your mind? Yes add to Labour's Legacy the fuelling of an artificial boom based on debt.

I am not defending Labour, I am saying they presided over a boom which made many people rich. The boom was deliberately fuelled long after it could have been brought to an end. The economy will now start paying for the boom years. Any sensible government would have tried to control HPI much sooner. The new rich will thank Labour by voting Tory, IMHO as was seen in Crewe and Nantwich.

[Moose423956]

social mobility was probably greater than under Thatcher

Au contraire, no other Government has done more to reduce social mobility; By giving people incentives to stay poor via the benefits system, by removing incentives for entrepreneurs and small businesses, by removing grammar schools, by making sure that all graduates finish university in debt etc etc. Making sure that people with brains from poor backgrounds cannot succeed.

Labour and their minions depend on a lumpen proletariat mass in order to justify their cause. It's in their best interests to keep the poor just that - poor. Socialism is inherently evil.

I need a lie down.

Again, not wishing to appear to support NL, but didn't those things happen before they came to power?

[Lockhouse]

social mobility was probably greater than under Thatcher

Au contraire, no other Government has done more to reduce social mobility; By giving people incentives to stay poor via the benefits system, by removing incentives for entrepreneurs and small businesses, by removing grammar schools, by making sure that all graduates finish university in debt etc etc. Making sure that people with brains from poor backgrounds cannot succeed.

Labour and their minions depend on a lumpen proletariat mass in order to justify their cause. It's in their best interests to keep the poor just that - poor. Socialism is inherently evil.

I need a lie down.

[BrilloPad]

Guys, I agree with what everyone has been saying here (all the correct bits anyway).

But let's play devil's advocate for a moment. Given that the Yanks have been pursuing hell for leather an expansionary economic policy for ten years, how much leeway did GB really have if the City and the UK as a whole wasn't to be left floundering in the US wake and left irretrievably miles behind.

The question is whether it is better to throw caution to the wind and aim for 2 or 3 % per annum growth for years, even if there's bound to be a reaction (depsite GB's absurd conceited claim to have abolished boom and bust), or go for a more cautious 1 or 2 % annual growth?

In short, what's best: 2 steps forward and one step back, or 1 step forward and 1/4 step back?

We all know the Government is severely limited in tax rises it can impose on city firms and workers, because they'll simply hoof it somewhere the tax regime is more liberal.

But doesn't the same pretty much true of financial regulation generally? Investors and speculators are bound to migrate where the rules are least onerous.

So in other words, how much could the Government really do without cooking the goose that laid the golden eggs?

The government needs all the tax it can get. So presumably to get the growth you need to drop interest rates or print money and lower taxes.

But it looks like food and oil prices will remain high for years.

So inflation will be forced up both ways.

FWIW I think Gordon will try to engineer this scenario - just not sure how he would do it.

Then his successors would be left with high personal (and government) borrowing and a devalued currency. Hey ho.

[Marina]

Guys, I agree with what everyone has been saying here (all the correct bits anyway).

But let's play devil's advocate for a moment. Given that the Yanks have been pursuing hell for leather an expansionary economic policy for ten years, how much leeway did GB really have if the City and the UK as a whole wasn't to be left floundering in the US wake and left irretrievably miles behind.

The question is whether it is better to throw caution to the wind and aim for 2 or 3 % per annum growth for years, even if there's bound to be a reaction (depsite GB's absurd conceited claim to have abolished boom and bust), or go for a more cautious 1 or 2 % annual growth?

In short, what's best: 2 steps forward and one step back, or 1 step forward and 1/4 step back?

We all know the Government is severely limited in tax rises it can impose on city firms and workers, because they'll simply hoof it off to somewhere the tax regime is more liberal.

But isn't the same pretty much true of financial regulation generally? Investors and speculators are bound to migrate where the rules are least onerous.

So in other words, how much could the Government really do without cooking the goose that laid the golden eggs?

[HairyArsedBloke]

On the face of it, making the BoE independent was a good thing to do. However, prior to the nuLieBore victory, the Conservatives had artificially kept rates too low and everyone knew that they had to rise. By making the BoE independent, Brown avoided the blame for the rise; cowardice from day one. The BoE is only pseudo-independent as the MPC has a large number of treasury members on it and the independent members are appointed by the government.