Thank you for clarifying because i was confused why borrowing to boost the economy made things bad when i thought it was the reverse of austerity and what ppl wanted. Good to know it was too much borrowing without a return plan
That's a good idea - so long as us poor people don't spent the extra on imported goods of course. It'd also help if extra spending didn't go on profits for so called 'providers' as they did to a crazy extent with those PPE contracts.
But also the highest birthrate in the west was when social spending was at it's height which was just after WW2. Where because you had millions of trained soldiers and very strong social cohesion the government didn't dare austerity and instead spend, spend, spend.
@@johnpritchard8946 It doesn't matter if they're imported goods. If people buy imported goods, the business selling them will make a profit. Taxes will be paid on that profit. Taxes will be given back to the people. People will be able to save money and start more small businesses. It's a win-win for everyone. As long as taxes are paid it doesn't matter to social systems whether those are taxes paid on imported or domestic goods. That is an issue for private industry, not the general public.
@@bobriquardo5317 " If people buy imported goods, the business selling them will make a profit." Really there are two sets of people involved: those who make the goods (foreign producers for imports) and those who import and sell them (UK agents). While it's true that taxes will be paid by UK agents and potentially some import duty too some of the extra money will leave the UK as profits for the foreign producers. The result is that the more the extra money is spent on imports the less the multiplier effect of the extra spending over all. You made a good point though and I think the first part of my original comment was too simplistic.
As always very interesting and with solid foundation arguments and ideas. But there is an easier way of creating growth in the UK, without raising inflation, you didn't mention. One of the major reasons for low growth in the UK is vacant jobs. Why? Because the EU workers who used to occupy them were sent home after Brexit. So if legal immigration was made legitimate and easier, those vacancies could be filled immigrants who both would help increase supply, as well as create more demand, but because the supply would increase more than the demand, inflation would not increase from this measure. But growth, supply and demand would, but since supply would grow more than demand, inflation would not increase. But tax revenue, consumer spending and investments would. That would be a first step to fix the UK economy. The second would be to get inside the European Free Market again as fast as possible, and at any cost. Cause to have a market economy without access to the biggest free market nearby, is not sustainable long term. The UK can either have no immigration, low growth, and trust they can produce all the country needs of food and goods - or the country can use immigration to increase domestic demand and supply, and that way create growth.
Starmer in a recent interview said freedom of movement has gone and it’s not coming back. Which means no prospect of change in the immigration policy even when Labour will get in government, as it seems the case from the polls.
@@pansepot1490 I think Sir Keir Starmer QC will have to change his mind before the next election, or the Libdems or even the SNP could end up in government instead. Since the UK's economic problems are so closely linked to supply problems, which again is a result of EU workers being sent home, it will soon be obvious to everyone that the quickest way to improve growth will be to fill the vacancies - and the quickest way to do that is to get them from abroad. It also is obvious, and will be clearer the longer the UK crisis will last, that since UK companies with sister- and daughter companies inside the EU have had more growth there than in the UK, being excluded from the European Free Market is the main reason for the low growth rate in the UK. The more people who realize both that immigration labor is the best way to kickstart the economy, and that full access to the European Free Market is the best way to strengthen and secure it long term, the more of a risky political move it will be to go against those views. Should both Labour and the Tories insist on holding on to the current Brexit situation, I think it not unlikely that not only the Libdems, but even the SNP could become big enough to to surpass both Labor and the Tories. Which of the Libdems or SNP that would become the bigger party, I think would depend on which of the two the English, Welsh and Northern Irish voters will believe to be in the best position to get a good deal for what will remain of the UK after Scotland has become independent and starts steps to rejoin the EU. Since such a process would take years, I find it reasonable that Scotland temporarily would be offered terms similar to a Norway deal in regard to access to the European Free Market, before eventually becoming an ordinary EU member. That could make such a deal available for the rest of the UK too, if the SNP also was part of the government in London. Should voters in the economic scenario I fear the UK will face unless the course is changed from the ERG's immigration allergy and Brexit worshipping, to a more realistic and sound economic policy, be more worried about their wallet and cost of living, than whether Scotland and England are part of the same country. In short, if Labor isn't willing to look more favorably on both immigration and the European Free Market, I don't think Keir Starmer will get the keys to Downing Street.
We need more people of working age in our country to earn money, spend money and pay taxes to pay for our state pensions and healthcare. It makes no sense at all to keep out people who want to come to the UK when they have the skills our economy needs. The trouble is there are not enough homes being built for people to live in, possibly in part caused by an exodus of East European builders, who might prefer to help Ukraine rebuild rather than hep post Brexit Britain build more homes.
If I own a home, I have to spend money maintaining and improving it if I want the value to go up, I can't ignore the leak in the roof and those dodgy looking wires and expect that it will spontaneously resolve and my property value will go up. That isn't how things work, if you don't spend money (well) you can't level up anything!
Speaking of inheritance tax, why don't you start with the monarch? I read somewhere that the current monarch is exempt from paying inheritance taxes. He monarch should lead by example.
Austerity was never really implemented. It was just a PR campaign by George Osborne to make lenders think that the UK was of good credit quality and not wasting their money. It worked very well because the pound GBP rose from 2010-2015 which is proof of an economy being seen as better quality relative to its peers. Then they announced the Brexit referendum and the pound went into constant free fall. However, total spending was rising most of the time that Cameron and Osborne were in office. Real austerity is actually a growth policy because by the government borrowing less, they leave funds available for the private sector to borrow to invest in business. It stops the situation of "crowding out."
Exactly. Most people just regurgitate "Austerity" but don't understand the reality of the situation. In the context of the UK, austerity was just a slowdown in the growth of government spending which in my opinion was insufficient. The UK was still running huge deficits and spending as a share of GDP was higher all throughout 2010-2017 compared to 2007.
Thank you for another thought provoking video (one that I will re-watch). There was one part that I didn't understand - Did you "misspeak" at 9:55 "A switch from National Insurance to Income Tax would mean that wealthy pensioners, who get a very good pension would pay more tax [...] Pensioners currently already pay income tax on withdrawals from their pensions if their state pension plus their pension withdrawals are greater than their personal allowance of £12,600. So, did you mean to say that "wealthy pensioners" should pay national insurance on their pension incomes as well as income tax? Approximately how much income a year would a pensioner / pensioner couple need to receive to be classified as wealthy? Would a couple whose combined income in retirement is £40,000 a year or £50,000 a year be "wealthy pensioners"? Assuming each pension receives about £10,000 a year in state pensions If they follow the advice of financial advisers they would need to have £500,000 in their combined pension pots to allow them to withdraw about £20,000 a year (or £750,000 to withdraw £30,000 a year. Not a problem for me 😊but did you know that pensioners with pension pots that exceed £1,073,100 already pay some tax at 55% ? (check out pension lifetime allowance). According to an FT article, UK state pensions are the worst out of all prosperous countries and currently pay out about 17% of median income (even the US state pension "social security" pays far more than the UK state pension).
Just bought a book titled, "The Capital Order: How Economists Created Austerity and Paved the Way for Fascism" by Chicago Press. The premise being that austerity is a way to take from the poor to give to the rich.
Seem very common sense suggestions that will boost the economy and be fair..that's why the Tories probably won't do them! Agreed, many rich pensioner couples especially, with big assets and/or pensions, raking it in - paying little tax and zero national insurance
What makes you assume the Britain has any growth prospects that even more cheap cash would help stimulate? Do you think we are smarter and more hard working than the Chinese and can live on lower wages? You are deluded to think mass manufacture is coming back or that we can even hold on to what little we have
It is extremely disingenuous to show inflation as "CPI". CPI is used to calculate inflation, is it not inflation in and of itself. Plus inflation is a bad metric for gauging the wealth of average citizens anyway anyway. How are they calculating the CPI? Certain markets will jack it up. Are they looking at average or median prices? I could go on, there are various ways to do it. Look at GDP/GDI for a real measure of the loss of purchasing power. It shows the same message you are trying to present, but is a lot less dramatic and more relevant to regular people and also less prone to interpretation or manipulation. Protip: Whenever there is a divorce in GDP to GDI, there's always a downturn.
Thank you for clarifying because i was confused why borrowing to boost the economy made things bad when i thought it was the reverse of austerity and what ppl wanted. Good to know it was too much borrowing without a return plan
Great to hear someone articulate the problems with hitting people too hard, especially when the inflation isn't wage growth driven
The UK needs trickle-up economics. Give more money to poor people and they will spend it - thus improving growth.
What's that give the lazy spongers more tax payers money wow is it actually worth working if you can get free money
That's a good idea - so long as us poor people don't spent the extra on imported goods of course. It'd also help if extra spending didn't go on profits for so called 'providers' as they did to a crazy extent with those PPE contracts.
But also the highest birthrate in the west was when social spending was at it's height which was just after WW2. Where because you had millions of trained soldiers and very strong social cohesion the government didn't dare austerity and instead spend, spend, spend.
@@johnpritchard8946 It doesn't matter if they're imported goods. If people buy imported goods, the business selling them will make a profit. Taxes will be paid on that profit. Taxes will be given back to the people. People will be able to save money and start more small businesses. It's a win-win for everyone. As long as taxes are paid it doesn't matter to social systems whether those are taxes paid on imported or domestic goods. That is an issue for private industry, not the general public.
@@bobriquardo5317 " If people buy imported goods, the business selling them will make a profit." Really there are two sets of people involved: those who make the goods (foreign producers for imports) and those who import and sell them (UK agents). While it's true that taxes will be paid by UK agents and potentially some import duty too some of the extra money will leave the UK as profits for the foreign producers. The result is that the more the extra money is spent on imports the less the multiplier effect of the extra spending over all. You made a good point though and I think the first part of my original comment was too simplistic.
As always very interesting and with solid foundation arguments and ideas. But there is an easier way of creating growth in the UK, without raising inflation, you didn't mention.
One of the major reasons for low growth in the UK is vacant jobs. Why? Because the EU workers who used to occupy them were sent home after Brexit. So if legal immigration was made legitimate and easier, those vacancies could be filled immigrants who both would help increase supply, as well as create more demand, but because the supply would increase more than the demand, inflation would not increase from this measure. But growth, supply and demand would, but since supply would grow more than demand, inflation would not increase. But tax revenue, consumer spending and investments would.
That would be a first step to fix the UK economy. The second would be to get inside the European Free Market again as fast as possible, and at any cost. Cause to have a market economy without access to the biggest free market nearby, is not sustainable long term.
The UK can either have no immigration, low growth, and trust they can produce all the country needs of food and goods - or the country can use immigration to increase domestic demand and supply, and that way create growth.
Starmer in a recent interview said freedom of movement has gone and it’s not coming back. Which means no prospect of change in the immigration policy even when Labour will get in government, as it seems the case from the polls.
@@pansepot1490 I think Sir Keir Starmer QC will have to change his mind before the next election, or the Libdems or even the SNP could end up in government instead. Since the UK's economic problems are so closely linked to supply problems, which again is a result of EU workers being sent home, it will soon be obvious to everyone that the quickest way to improve growth will be to fill the vacancies - and the quickest way to do that is to get them from abroad.
It also is obvious, and will be clearer the longer the UK crisis will last, that since UK companies with sister- and daughter companies inside the EU have had more growth there than in the UK, being excluded from the European Free Market is the main reason for the low growth rate in the UK.
The more people who realize both that immigration labor is the best way to kickstart the economy, and that full access to the European Free Market is the best way to strengthen and secure it long term, the more of a risky political move it will be to go against those views. Should both Labour and the Tories insist on holding on to the current Brexit situation, I think it not unlikely that not only the Libdems, but even the SNP could become big enough to to surpass both Labor and the Tories. Which of the Libdems or SNP that would become the bigger party, I think would depend on which of the two the English, Welsh and Northern Irish voters will believe to be in the best position to get a good deal for what will remain of the UK after Scotland has become independent and starts steps to rejoin the EU. Since such a process would take years, I find it reasonable that Scotland temporarily would be offered terms similar to a Norway deal in regard to access to the European Free Market, before eventually becoming an ordinary EU member. That could make such a deal available for the rest of the UK too, if the SNP also was part of the government in London. Should voters in the economic scenario I fear the UK will face unless the course is changed from the ERG's immigration allergy and Brexit worshipping, to a more realistic and sound economic policy, be more worried about their wallet and cost of living, than whether Scotland and England are part of the same country.
In short, if Labor isn't willing to look more favorably on both immigration and the European Free Market, I don't think Keir Starmer will get the keys to Downing Street.
We need more people of working age in our country to earn money, spend money and pay taxes to pay for our state pensions and healthcare.
It makes no sense at all to keep out people who want to come to the UK when they have the skills our economy needs.
The trouble is there are not enough homes being built for people to live in, possibly in part caused by an exodus of East European builders, who might prefer to help Ukraine rebuild rather than hep post Brexit Britain build more homes.
If I own a home, I have to spend money maintaining and improving it if I want the value to go up, I can't ignore the leak in the roof and those dodgy looking wires and expect that it will spontaneously resolve and my property value will go up. That isn't how things work, if you don't spend money (well) you can't level up anything!
Speaking of inheritance tax, why don't you start with the monarch? I read somewhere that the current monarch is exempt from paying inheritance taxes. He monarch should lead by example.
*TORYNOMICS* the rich must be taxed as little as possible to not upset their delicate feelings...
Austerity infers living within your means, the UK Government is borrowing like made the exact opposite of austerity.
Austerity was never really implemented. It was just a PR campaign by George Osborne to make lenders think that the UK was of good credit quality and not wasting their money. It worked very well because the pound GBP rose from 2010-2015 which is proof of an economy being seen as better quality relative to its peers. Then they announced the Brexit referendum and the pound went into constant free fall.
However, total spending was rising most of the time that Cameron and Osborne were in office.
Real austerity is actually a growth policy because by the government borrowing less, they leave funds available for the private sector to borrow to invest in business. It stops the situation of "crowding out."
Exactly. Most people just regurgitate "Austerity" but don't understand the reality of the situation. In the context of the UK, austerity was just a slowdown in the growth of government spending which in my opinion was insufficient. The UK was still running huge deficits and spending as a share of GDP was higher all throughout 2010-2017 compared to 2007.
Thank you for another thought provoking video (one that I will re-watch).
There was one part that I didn't understand - Did you "misspeak" at 9:55 "A switch from National Insurance to Income Tax would mean that wealthy pensioners, who get a very good pension would pay more tax [...]
Pensioners currently already pay income tax on withdrawals from their pensions if their state pension plus their pension withdrawals are greater than their personal allowance of £12,600. So, did you mean to say that "wealthy pensioners" should pay national insurance on their pension incomes as well as income tax?
Approximately how much income a year would a pensioner / pensioner couple need to receive to be classified as wealthy?
Would a couple whose combined income in retirement is £40,000 a year or £50,000 a year be "wealthy pensioners"? Assuming each pension receives about £10,000 a year in state pensions If they follow the advice of financial advisers they would need to have £500,000 in their combined pension pots to allow them to withdraw about £20,000 a year (or £750,000 to withdraw £30,000 a year.
Not a problem for me 😊but did you know that pensioners with pension pots that exceed £1,073,100 already pay some tax at 55% ? (check out pension lifetime allowance).
According to an FT article, UK state pensions are the worst out of all prosperous countries and currently pay out about 17% of median income (even the US state pension "social security" pays far more than the UK state pension).
I also had to do a double take at 9:55 and still not sure of the logic. Interesting data on your comment about UK state pensions from an FT article.
If someone has a couple hundred k sitting around in the bank what would you recommend them investing in now?
Just bought a book titled, "The Capital Order: How Economists Created Austerity and Paved the Way for Fascism" by Chicago Press.
The premise being that austerity is a way to take from the poor to give to the rich.
Seem very common sense suggestions that will boost the economy and be fair..that's why the Tories probably won't do them! Agreed, many rich pensioner couples especially, with big assets and/or pensions, raking it in - paying little tax and zero national insurance
Thks & request an upate
What makes you assume the Britain has any growth prospects that even more cheap cash would help stimulate? Do you think we are smarter and more hard working than the Chinese and can live on lower wages? You are deluded to think mass manufacture is coming back or that we can even hold on to what little we have
Funny didn’t may turn away from austerity and the markets and the left had a go about it.
amen
great
12 years of inept Gov and we get this as voter reward.
It is extremely disingenuous to show inflation as "CPI". CPI is used to calculate inflation, is it not inflation in and of itself. Plus inflation is a bad metric for gauging the wealth of average citizens anyway anyway. How are they calculating the CPI? Certain markets will jack it up. Are they looking at average or median prices? I could go on, there are various ways to do it. Look at GDP/GDI for a real measure of the loss of purchasing power. It shows the same message you are trying to present, but is a lot less dramatic and more relevant to regular people and also less prone to interpretation or manipulation. Protip: Whenever there is a divorce in GDP to GDI, there's always a downturn.
would the EU freedom of movement be good for UK tax payer?
one word - keynes