Thread: Cutting Government Spending

A great exchange of ideas and debate. GC mentioned the prevailing order and he is right, yet if Ron Paul did win that prevailing order would be threatened straight away.

GC I also think our limited agriculture and loss of fishing industry is to do with the prevailing order.

As much as manufacturing is appealing you need a market that is willing to buy your produce. We hold up Gemany yet they have 25,000 British troops on their soil and until recently had over 100,000 US troops. Japan another satellite of the US empire has around 70,000. I am reluctant to use either of them as an example because I believe they were part of a prevailing order that guaranteed a market providing their goods were of a certain standard.

I believe the prevailing order (PTB) are holdng back big leaps in clean energy (not windmills) and health technology (through personal experience and helping friends and family with infertility, back pain, cancer risks, stomach pains when the medical system failed them etc. We could make huge leaps yet the rest of the world would copy these too so economically we might only benefit financially in the short term. Yet just the boost from travel would spiritually lift the world and get the economies moving we need clean technology to be allowed to come through.

I do believe we could not successfully adopt a Ron Paul system here, over-populated and few natural resources. I see no point in a goverment cutting costs without having growing markets in something to create employment.

A consumer economy only works short term as people need the savings or credit to buy.

I think it is pointless looking back on UK history because we had a global empire with trade privileges up until 1947 built on the mililtary sacrifices of soldiers, sailors, airmen over 300 years since the East India Company. That is not a normal state of affairs.

If we could it would make sense to:
Increase agricultural independance,
Reclaim fishing,
Stop participating in foreign wars unless we are going to be paid by the UN or another body (hopefully for humanitarina causes)
End most foreign aid.
Take the profit motive for corporates out of health, so many testing devices poison you before you get anywhere close to a diagnosis. CAT scans. MRI, X-rays, dodgy vaccines and pharmaceuticals etc.
Ensure all companies that want to do business here register a UK entity to prevent tax evasion.
Look at the young girls today drinking like men do we really think they are going to be able to work until 70?
Educate the young on the importance of good nutrition, it can do a lot.
Make things the home market would use as part of the infrastructure, trains, buses, emergency vehicles.
Reduce immigration while we have many employed and as CB100 or Francis said make sure they contribute to a minimum number of years paying tax before earning the ability to take benefits.
Make the most of what you do well, and what resources you have, international trade is the answer.
Keynes was not just a spender, he said the problem had been caused by finanancial irregularities and dangerous speculating, He said international trade and to make things close to where the market was located to keep jobs and stop the financial speculating. He died a year later.
Most of what I mention is controlled by the PTB or prevailing order.

If Ron Paul could win that could prove to be a game changer for the world. It would be naive to think one model would fit all, the US could be self sufficient the UK couldn't, it would need to trade.

Originally Posted by Roland

Ok let's just make sure we're singing off the same hymn sheet.

Your saying that the demand for labour especially low skilled labour is being reduced due to the fact people are being replaced by computers which is creating a necessity for the government to step in and create jobs. Is that right.

Roland: Not quite right. There is no hope of replacing unemployment with an economic activity which needs a mass labour force. Should you disagree, identify what that activity should be. However, it is still possible that nations can still be economically viable by creating employment for useful social activities which can be afforded, and which provides purchasing power for the multitude to partake as customers in a means of production which is founded on mass production. Mass production requires a mass purchasing population. What we have at the moment is an ever increasing unemployment rate in the western world. Furthermore, low interest rates are harming, and in some cases destroying, pension funds. As a consequence the elderly are extending their working lives to replace their depleted pensions, at a time when twenty-five per cent of the over forties are still being 'subsidised' by parents due to unemployment, debts, negative equity, and the cost of divorce, etc. We have a million youngsters unemployed, while even their parents are often dependent on grand-parents. This situation is broadly uniform throughout the western world. Furthermore, in the UK, the extended life-expectancy will ensure that property will increasingly be used to pay for care in old age. No wealth-created prosperity from home-ownership will be 'cascading down the generations' as predicted by John Major. It is still possible to have a market system, but not everything will function if it is subject only to the discipline of the market place. NOT EVEN ADAM SMITH BELIEVED THAT WAS POSSIBLE.

You can elect Ron Paul or even St.Paul as president, but unless they have an economic plan to operate simultaneously a means by which a producer society and a consumer society are compatible, nothing can change. China, indeed much of Asia, have a choice which we in the west do not have. They can have both labour and capital intensive economic production activities. We, by contrast, can only have massive unemployment and capital intensive production. Even in Asia, the need to have mass consumerism at home will necessiate some kind of Keynsian economics for the multitude in the not too distant future. Americans can dream of some modern Fortress America: it could work to a limited extent. But what about their global investments; they would have to be accommodate within their own domestic markets. In addition the fight for national political influence on the world stage will continue irrespective of what certain countries choose to do. Britain has had first hand experience of that problem. Prior to WW1, we had the largest Empire of either ancient or modern times; the richest on earth. But it had a major defect; half our overseas investmnents were invested in countries outside the Empire. Trying to balance Imperial interests with national ones, while not harming those other investments, precluded those simplistic solutions proposed by the Empire Preference lobby. They had a lot of popular support, but the poor things never recognised the contradictions of what they proposed.

Never mind Roland and Jason; keep reading and doing your homework.

Originally Posted by Geoffrey Collier

Patman Post: When a significant part of the banking system collapses and needed to be nationalised, that is not an indication of a sound economic system. Virtually all occupational pension schemes have closed. The employment situation in the western world is poor and getting worse. There are 21.21. million in full-time employment in the United Kingdom (August 2011) 13.60. men 7.60. million women. (part-time occupations count for 7.6 million) Much of that is seasonal and low paid. Many of the full-time occupations are not directly involved in 'wealth creation, as the more emotional describe it, but I do not think that is necessarily required. The trading viabiliy of a nation is more important when the nature of the economy is a consumer based one. Relatively small parts of the economy (in employment terms) can,and does, provide a disproportionately large percentage of the wealth. The more that public spending is cut, higher will be the unemployment figure.

What you describe is a blip in the big picture. No doubt bits of the current "crisis" will leave their marks (e.g., changed life-styles, pensions and employment practices). But history shows us that in ten years employment will have continued its upward trend. Even if fewer people are involved in "wealth creation", state take and trickle down will continue to fund essential areas and discretionary spend.

PS: Population growth, education and movements are likely to be a key long-term factors in shaping the World's (and Britain's) economy.

What we are seeing today is the unintended consequences of 50 years of government manipulation and distortion of the economy.

I understand the gloomy picture that GC creates but the fact is we are not going to be able to 'tweek' the economy for a whole lot longer.

Hong Kong adopted a policy of single straight 15% tax and as little government and as little government interference as possible and that had continuous growth for 50 years which would suggest the best way to move an economy is to let it move it's self. Communist China sat next door watching this miracle of wealth and production unfold while watching the soviet empire shrink and collapse in it's own stupidity. Thankfully for the Chinese it endorsed the Hong Kong model and with that economic freedom came the end of a lot of government restrictions over it's people.


This argument comes down to do you have faith in people or do you think people need nannying I personally have faith in people.

As for Ron Paul I do get fed up with the way people like GC slag him off and say he's not taken seriously by any serious economist. Ron paul is hardly thick he's a Doctor and was an aircraft pilot in the military. The fact is very few serious economists predicted the economic collapse suggesting the modern doctrines supported by economists are in fact wrong, Ron Paul on the other hand clearly lined out that the economic collapse was coming and why.

So who's opinions do I take on board those that are wrong or those that are right?

Many of the full-time occupations are not directly involved in 'wealth creation, as the more emotional describe it, but I do not think that is necessarily required.

It not an emotional argument it's a fact that those in the wealth creating, productive sector, fund those in the public. If it was no more than a emotional argument we'd all be able to sit on our backsides and just let the BoE print our wages all week.

I like a drink and a smoke and am paying tax on those (I believe I read somewhere that for every £1 smokers cost the NHS they pay in £3.) Then I die earlier and don't get a pension.Oh,and if get run over because I am always careless crossing the road the state can bring up my 3 children.