Is Unemployment a "Price Worth Paying"?

And reducing public spending is necessary why? In order to make the public finances sustainable

That’s a matter of policy decision…

Whether you accept that policy is down to individual judgement.

HOWEVER, even if you DO accept the requirement – reflecting on Govt mandated unemployment (ie lost Public Sector jobs) as an indicator of the wider economy is questionable.

That widely reported, shocking, increase in unemployment is the Govenerment’s making, not the “general economy”.

Low, but steady, private sector growth (start of a recovery?) has been undermined by the substantial (politically driven) reduction in Govt spending

its still not been answered how else the deficit should be closed without public spending cuts? if the cuts weren’t made, where would the money be coming from?

its still not been answered how else the deficit should be closed without public spending cuts?

how much have they reduced it by so far?

I don’t think anyone disputes that the deficit needs to be reduced…

But the suspicion that the “rate of reduction” is unnecessarily quick, painful and polically motivated gets stronger every day.

Early on we were told about quick reduction and return to growth – now we have 10 years of sluggish growth and austerity. That doesn’t soundlike we’ll be reaping the benefits of rapid deficit reduction

That’s a matter of policy decision…

Whether you accept that policy is down to individual judgement.Agreed.

HOWEVER, even if you DO accept the requirement – reflecting on Govt mandated unemployment (ie lost Public Sector jobs) as an indicator of the wider economy is questionable.

That widely reported, shocking, increase in unemployment is the Govenerment’s making, not the “general economy”.Sorry, don’t get what you mean reference government mandated unemployment as an indicator… it’s been a long day here!

Yes, I take your point that it is the government making these public sector workers redundant directly, and that this unemployment is therefore of their making. But the government has a wider duty to act in this country’s long term interests, meaning (and here we’re back to your notion of individual acceptance of policy decisions and the reasoning behind them) government spending must be sustainable (accepting that this will involve some level of government debt!).

Low, but steady, private sector growth (start of a recovery?) has been undermined by the substantial (politically driven) reduction in Govt spending

And by the continuing global economic downturn.

This was the ‘tale’ about a year ago

http://www.epolitix.com/latestnews/article-detail/newsarticle/cameron-rejects-talk-of-double-dip-recession/

Shouldn’t the question be, how the **** did we manage to get into a situation, as a society, where the state is consistently spending massively (really, really massively) more than its taking in in total receipts – its really such a simple fundamental economic principle 👿

enfht – Member
Should the UK have propped up the uncompetitive bombadier?

Posted 3 hours ago # Report-Post

But then Bombardires site was once owned by us the taxpayer and called British Rail, and sold off quite a few times

I always find it amusing to find anti Labour sentiments expressed on a mountain biking forum considering that the Tories wouldn’t have brought in the Land Reform Act or required the Forestry Comission to open up forestry land for public use. Both these things have made possible biking as it exists in Britain today! 😀

The premise of the OP is wrong – unemployment is deemed to be a price worth paying in the context of keeping inflation down. Neither the government nor the BoE want to keep inflation down (despite what the BoE mandate says).

I don’t think anyone disputes that the deficit needs to be reduced…

But the suspicion that the “rate of reduction” is unnecessarily quick, painful and polically motivated gets stronger every day

The difference in the rate of reduction between labour and the conservatives isn’t hugely significant in the overall scheme of things. The rate of reduction is also pretty insignificant when seen in the context of the actual debt rather than the deficit.

There is a very real risk that without the perception that the government is being tough on the deficit, the bond markets would see us as the basket case we really are. They probably already would if it wasn’t for the fact that most other major economies are just as bad or worse.

Fundamentally, as Zulu Eleven says, we spend too much on ourselves and produce too little of value. This is a long incubated outcome of decades of dishonest politics and personal greed. Neither party has had the courage or conviction to deal with it, and Gordon Brown was the worst of all – the reason we can’t extend the deficit at the current time is that he splurged the surplus on buying votes in the public sector, and called it ‘investment’.

Anyway, why is the level of debate from the left over this issue restricted to OMG THE TORIES ARE EVIL? the level of missing the point is only exceeded by the public sector unions trying to justify their pensions…don’t quote Keynes as a solution in the current situation when you don’t understand the quid pro quo.

I think the best phrase that can be used to sum up all politicians is “shower of shite the lot of them”.

We can only reduce the deficit through economic growth. This bunch of morons seem to be intent on stifling growth at absolutely every opportunity available to them.

Bombardier were deemed uncompetitive due to there credit rating compared to Siemens. Im fairly certain a German or French government would have found away to make the financials work for a company in there own country. Most of the “cost” would be re-cycled into the domestic economy.

I work for the UK’s “leading light” in high value added manufacturing (they make aero-engines just to give a little clue) and I’ve heard from a good source the view of the board level executive is that “this lot (i.e coalition) don’t get it (the role high value added manufacturing can have for the UK economy)

Sheffield Forgemasters – Finance deal that would have enable them to be one of three global companies to produce steel forgings for the global nuclear renaissance was taken away within weeks of the coalition coming to power.

And Osbourne wants to lead “the march of the makers” total Bollocks! Pure lip service for fleet street.

Fundamentally, as Zulu Eleven says, we spend too much on ourselves and produce too little of value.

You don’t know Zulu that well do you?

the level of missing the point is only exceeded by the public sector unions trying to justify their pensions.

Since the public sector workers didn’t create this problem, I’d say they are more than justified to protect their pensions.

the level of missing the point is only exceeded by the public sector unions trying to justify their pensions.

So good pension provision is wrong is it? If you cannot trust your gov. to do the right thing by its workers who can you trust?

So good pension provision is wrong is it? If you cannot trust your gov. to do the right thing by its workers who can you trust?

No, it’s a right (and obligation) for everyone that has turned into a privilege for some due to unrealistic expectations.

Your government has no money, it belongs to the taxpayers. It’s not a question of the government looking after its workers, it’s a question of taxpayers paying for other peoples’ pensions instead of their own.

Anyway, my point was more that you can’t have a debate about something without engaging with the underlying issues. Public sector pensions are just the best example at the moment:

– “a £5,000pa pension isn’t gold plated”
– “public sector pension costs as a percentage of GDP will fall over the next 60 years, therefore they are affordable”
– “public sector pensions aren’t in deficit”

etc. etc. all missing the point.

The pensions issue and the deficit issue are fundamentally linked.

The pensions issue and the deficit issue are fundamentally linked.

out of intrest what proportion of the deficit can be attributed to pensions?

In the sense that both are the result of wilfully, or just blindly living beyond our means.

Public sector workers believe they have a right to a guaranteed income stream in retirement, regardless of the actual cost and who actually pays. Also that the level of income should remain proportionally the same as when said pensions were first established, when people died 10 years after retirement, and the western world was in the middle of a post war boom.

Western society as a whole believes it has a right to constantly increasing levels of consumption and living standards, despite being unable to generate the economic value to support it without borrowing until we are virtually insolvent.

so you have no idea then? Me neither.

Public sector workers believe they have a right to a guaranteed income stream in retirement, regardless of the actual cost and who actually pays

and private sector workers that everyone shouldhave a really shit pension like they do rather than insisting that they get a good pension like say the board /executives of the companies they work for.

A proper us and then divide and conquer tactic being used
The teachers fund for example has no expected shortfall and is guaranteed in law that any shortfall is met by teachers.

m-f that is very harsh surely some marks for their reasoning 😉

It’s not relevant though.

The proportion of the annual deficit is almost irrelevant because the burden of pensions isn’t about the current annual cost, it’s about the future liability.

Public sector workers believe they have a right to a guaranteed income stream in retirement, regardless of the actual cost and who actually pays

Or, conversely, public sector workers entered into a contract with an employer which clearly set out the pension benefits that they would achieve and the length of time they would have to work to accrue such benefits.

Public sector work was available to anyone who chose to do it, was always seen as a poor choice in terms of wages, working conditions and status.

Because the global economy is in the shit, you’d like to take away my pension…

Thanks.

Western society as a whole believes it has a right to constantly increasing levels of consumption and living standards, despite being unable to generate the economic value to support it without borrowing until we are virtually insolvent.

I’m glad you at least understand what capitalism does.

I’m glad you at least understand what capitalism does.

He typed on his capitalist computer, using his capitalist broadband etc…….

Sixth form politics strikes again.

and private sector workers that everyone shouldhave a really shit pension like they do rather than insisting that they get a good pension like say the board /executives of the companies they work for.

No, private sector workers can’t afford good pensions because reality hit them first. What’s more, they have to pay for public sector pensions whilst failing to make provision for themselves! Anyway, explain to me who will pay for everyone in the private sector to have the same pension provision as the public sector?

I do agree though that the disparity between board level pay and the rest of the workforce is becoming a disgrace- something I think is unsustainable and the fault of shareholders more than anything else.

He typed on his capitalist computer, using his capitalist broadband etc…….

keep your friends close but your enemies closer… 😐

Or, conversely, public sector workers entered into a contract with an employer which clearly set out the pension benefits that they would achieve and the length of time they would have to work to accrue such benefits.

So did private sector workers – and we sat there and watched as a certain Mr G.Brown plundered our pension funds to the tune of fifty billion quid, to pay for an unprecedented expansion of the public sector, which ended up with a million more workers than when Labour came into power.

Public sector work was available to anyone who chose to do it, was always seen as a poor choice in terms of wages, working conditions and status

Yep, and we listened to years and years of Union officials (who directly funded the Labour party and selected its leader) telling us that this was unfair, that public sector workers were equally important, and that their pay and conditions must match those in the private sector…

So, really Crikey, its a taste of your own f’king medicine! 😉

.don’t quote Keynes as a solution in the current situation

I think you’ll find Keynes has solutions to many problems.

I’m tired and am off to bed

-Probably said by Keynes one evening.

I’m hungry, I think I’ll have a sandwich.

-Probably said by Keynes one lunch time.

I need a poo,please excuess me I’m off to the loo.

-Probably said by Keynes one time after he ate something a bit funny, perhaps even a sandwich.

It’s not relevant though.

The proportion of the annual deficit is almost irrelevant because the burden of pensions isn’t about the current annual cost, it’s about the future liability.

not relevant or almost irrelevant? even though you have no idea how big it is? It could be half of it? We should be told!! Or again is it nothing to do with the deficit?

as an aside didnt someone point out that future liabilities are reducing as a proportion of GDP? I have a sneaking suspiscion you have no idea what you are talking about.

Well ZE, if you weren’t bright enough to be a nurse 25 years ago you really should have worked a bit harder at school…

Yep, and we listened to years and years of Union officials (who directly funded the Labour party and selected its leader) telling us that this was unfair, that public sector workers were equally important, and that their pay and conditions must match those in the private sector…

I see nothing wrong with this, or do you think that public sector workers should always be considered less important, and have worse pay and conditions than the private sector?

Tell us how much you earn then, tell us what you do, tell us what hours you work and tell us what your pension will be.

not relevant or almost irrelevant? even though you have no idea how big it is? It could be half of it? We should be told!! Or again is it nothing to do with the deficit?

as an aside didnt someone point out that future liabilities are reducing as a proportion of GDP? I have a sneaking suspiscion you have no idea what you are talking about.

Without wishing to be rude, you’ve proved my point. You asked what proportion of the deficit (i.e. the annual deficit of income over expenditure) could be attributed to public sector pensions. I said that this wasn’t especially relevant, except in short term cash flow terms. The relevant question is the burden of future pension obligations, and how much funding will be required to service those in the future.

You’ve misunderstood the future GDP issue as well. I thought that the unions were arguing that the annual cost of pensions will be lower as a proportion of GDP in 60 years? Not that the future liability will be a lower proportion. Anyway, forecasts over that sort of period are really meaningless.

I’m glad you at least understand what capitalism does.

I think I do thanks, but you clearly don’t if you think my statement was a summary of the theory.

He typed on his capitalist computer, using his capitalist broadband etc…….

Sixth form politics strikes again.

This I don’t understand – am I being placed in the anti capitalist camp?

Tell us how much you earn then, tell us what you do, tell us what hours you work and tell us what your pension will be.

if he’s in the private sector he can’t tell you what his pension will be…that’s part of the problem.

I think its entirely fair that your terms and conditions are equal to those in the public sector

At the same time, I think its equally fair that your pension is equal to those available in the public sector

The value of private sector pensions has fallen, they are at the whim of the market, and frequently fail – public sector pensions are currently underwritten by the rest of us, thats not equality – if you demand parity in pay, terms and conditions, then I, as a private sector worker, demand parity in your pension provision in return.

Without wishing to be rude, you’ve proved my point. You asked what proportion of the deficit (i.e. the annual deficit of income over expenditure) could be attributed to public sector pensions. I said that this wasn’t especially relevant, except in short term cash flow terms. The relevant question is the burden of future pension obligations, and how much funding will be required to service those in the future.

You’ll hvae to run that past me again in plain english because my A level economics doesnt allow me to determine what if any point your trying to make.

Heavy engineering, bus and truck building, car making, steelmaking, foundries, train and tram manufacture,and a lot more of the engineering skills have been allowed to close or been destroyed by numerous governmnents, all helped along by the failing unions, who are now throwing the toys out the pram as a token jesture to the inevitable, uk plc, being broke.

I think the best phrase that can be used to sum up all politicians is “shower of shite the lot of them”.

This.

I didn’t want the Tories in office in 2010, but I equally wanted Labour out of office for a very long time.

if you demand parity in pay, terms and conditions, then I, as a private sector worker, demand parity in your pension provision in return.

First time you have ever written something I agree with, where do we sign?

if he’s in the private sector he can’t tell you what his pension will be…that’s part of the problem

So attacking my pension provision makes sense because?

So attacking my pension provision makes sense because?

So, attacking my income by forcing me to pay tax which goes to pay your wages makes sense because?

If I want your services, I can pay for them!

Zulu, you’re a closet communist!

We should all be paid the same, comrade?

So, me paying tax to pay your wages makes sense because?

I is educating the masses so you lot can exploit them effectively