as I guess is this

3.30 If the welfare cap is found to be breached in one or more of the years in which it applies, there will be a debate on a votable motion led by the Department for Work and Pensions, normally within 28 sitting days, giving an assessment of the reasons for the breach. The Department for Work and Pensions will:
• propose government policy measures which will reduce welfare spending to within the level of the cap;
• seek approval for the level of the welfare cap and/or margin to be increased, along with an explanation of why this is considered to be justified; or
• explain why a breach of the welfare cap is considered justified.

Madness eh???

Nope – all entirely subjective and thus amenable to “interpretation” by anybody.

How about bringing some objectivity to the table then?

yup, the use of the word “cyclical” effectively means that they can do whatever they want whenever they want as they’re defining the cycle themselves. So this is a meaningless piece of politics (economically speaking), which solely exists to stuff up the opposition by making them look bad however they react to it.

Also, when did Osborne become a supporter of Keynes? He’s been pushing deficit reduction in a period when Keynes would advocate spending. Oh, is it because his previous attempts at deficit reduction haven’t worked?

Indeed odd that GO is running one of the most expansive fiscal policies in the developed world – austerity economics eh?

Equally odd to knock the OBR – they are the body that has the data that falsifies the idea of Labour profligacy pre crisis. Worth reading their stuff!!

link to the data which supports that?

Also an expansionary fiscal policy =/= Keynes (not in the generally understood sense anyway)

Where have I knocked the OBR? I’m saying his current Fiscal Charter is balls, not the OBR.

austerity economics eh?

That is reserved for the folks at the bottom.

even though the stats also falsify that point too?

never mind…what was the expression, “I thought you were above that kind of thing” 😉

Anyway – bon appetite! Lunchtime beckons!

Meeting anybody interesting?

Also an expansionary fiscal policy =/= Keynes

Very true

(not in the generally understood sense anyway)

Sadly untrue. Talking of Balls…

The article started by saying Tony Blair and Gordon Brown will
“ceremoniously ditch Labour’s traditional ‘tax, spend and borrow’
image this week, in a fundamental re-positioning of his party’s
economic strategy.”

All under the headline… Labour Ditches Keynes.

As someone who had only recently studied ‘New Keynesian’ economics at
Harvard, with Democrat Keynesians like Larry Summers and Republican
Keynesians like Greg Mankiw, I must admit I was pretty appalled to see
the greatest economist of the twentieth century traduced like that.

But the fact was that in the Monetarists versus Keynesians economic
debates of the 1970s and 80s, the label ‘Keynesian’ had become –
certainly in Conservative circles – a dirty word: profligate,
irresponsible, statist, inflation-loving, not to be trusted.

A caricature that clearly could not be allowed to be a Labour
caricature if we were to go on and win the 1997 election.

And what has been so striking to me over the past year listening to
right-of-centre politicians and commentators – in Britain, America and
Europe too – is how much the austerity debate has been used to try to
reprise those old ideological divides.

Warn about the risks of deflationary fiscal policy – and that makes
you a ‘deficit denier’.

Worry about the dangers of all countries trying to cut their deficits
at once – and you are a ‘deluded Keynesian’.

Counsel that the world needs a plan for growth as well as deficit
reduction – and you are ‘an irresponsible deluded Keynesian deficit
denier’.

Keynes himself must be turning in his grave.

For, as has been fully documented in Lord Skidelsky’s biography, the
real Keynes was no profligate tax-and-spender. He would have had no
time for some of his disciples.

Anyway, political tribalism aside.

At best it’s stupid, it compels the Government to reach a surplus by 2020, which has been at the top of their published goals since 2009 politically no body cared about the deficit pre-crash – neither side of the house. So It adds nothing to the party. It also calls for this to continue post-2020, if they lose the next election it counts for nothing.

At worst, it’s dangerous, politically they won’t want it to fail so they will be compelled to stick to it after it’s sensible to set it aside, massive natural disaster, financial crisis, war, famine – first reaction will be to hold back, fearing the fall-out.

Perhaps worse still, it allows them to cut investment that would otherwise be sensible, citing the charter – it’s only going to be binding as long as it’s politically useful to them.

Labour were stupid to agree to it in the first place, economic policy should be fluid to react to the current situation with an eye on the future – not based on political ideology from the past. It’s already blown up in Labours face, but that won’t be nearly as bad if some of the Tory back benchers start to wobble. The SNP are dead against it.

even though the stats also falsify that point too?

That will be a relief to the victims of tax credit cuts – their hardship is statistically insignificant.

If my memory serves my correctly, the charter only focused on the current account

Yes, some people will lose out from the cut in tax credits – the IFS has some supporting analysis

The Conservatives are cutting back on some channels of public expenditure (healthcare, public services etc) and investing in infrastructure projects as a way of stimulating the economy. It’s the American model of Keynesian economics. They’re still spending a lot but being ideologically selective about where they spend by utilising the private sector. The ‘Austerity’ thing is just spin.

Hodges was right about the trap to a large extent

Considering Labour invented the trap in the first place, it is even more silly to fall into it. When similar proposals were touted in Labour’s fiscal responsibility bill, Osborne described them as vacuous and irrelevant.

Fail to learn your own lessons from history!!!

The ‘Austerity’ thing is just spin.

😉

Wow you just criticised the conservative party for not learning instead of just using it to criticise labour when both sides have flip flopped

Well done for achieving the non political impartiality you so often preach about. 😛

I dont think he got lucky as he missed all his targets and basically did what labour suggested we do at the 2010 election.

I’m not necessarily going to disagree there – however Labours reaction to that was not to recognise that and say ‘told you so’ and then support those plans, it was to double down on their own bet and keep shouting ‘too far, too fast’ with a strange head wobble. Thus, when Osborne came out of the other side without the much vaunted double or triple dip recession actually happening, it’s impossible for Labour to claim the victory.

Balls was pretty close to be the most accurate commentator though -flatlining was a pretty good description in the end!

His writing > his pugnacious character in HoCs

Only 21 abstentions

At least Newsnight has started showing Osborne’s volte-face

Embarrassing, embarrassing, embarrassing, embarrassing, embarrassing …yes, of course it is.

😀 at least that is straight and honest!!

Can’t help feeling that GO has set a trap for himself too. Newsnignt is comical now listening to the two MPs. Kirsty’s having fun!!!

The most incisive intervention from the Labour benches came from Jonathan Reynolds, who left Tory MP Mike Wood almost speechless when he said: “No Conservative government in history has ever hit the target being presented to Parliament tonight.

“All those historical Conservative governments – none of them have run surpluses according to this fiscal charter.

“Were the Conservative governments of Harold Macmillan, Margaret Thatcher, were they not economically credible?”

Mr Wood replied: “I’ll leave that. I’m not sure that even dignifies…” before trailing off.

😆