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| What some millionairs are saying.; Are Laffer and co laughable? | |
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| Topic Started: Jan 9 2015, 11:23 AM (969 Views) | |
| C-too | Jan 9 2015, 11:23 AM Post #1 |
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Honourable Member
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The ideas from radical economists like Laffer that lower taxation would stimulate growth, that "the rich should be free from the burden of tax" and that "taxing the rich would make society as a whole poorer". With low taxation trickle-down would be our reward. These ideas obviously appealed to Thatcher and Reagan. The reality is that both in the UK and in the US the suggested growth did not take place, investment actually fell. 30 Years of low taxation/trickle-down has in reality been low taxation/trickle-up. 30 years ago the richest people in the country owned 10% of the wealth, today it is claimed they own 20%. Even multi millionaires on the programme were saying that things need to change, that the middle classes are suffering economically, pushing more of them out of the housing market was an example given. There was even the suggestion that there are ongoing detrimental changes in society that will benefit no one in the end. When millionaires both in the UK and the US are saying we got it wrong and changes need to be made, then maybe changes do need to be made. |
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| Tigger | Jan 11 2015, 10:25 PM Post #41 |
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A bit slow are we? Of course what you forgot to mention, probably because you always defend those far richer than you for some bizarre reason is that deflation hits everyone, are you ready for this? Asset prices are FAR TO HIGH for the rest of the economy to be able to afford them, housing is way to expensive, land is overpriced, many stocks are in the stratosphere and prices in many cases do not reflect demand, these elevated prices are kept propped up by bank bailouts, protective legislation and easy credit to those who hold these assets without these supports the market would set the price, ie a price that encourages people to spend the limited funds they do have. Deflation will hurt the very wealthy, the very reason there is fear mongering every time deflation rears it's head. In fact Jeremy Warner over at the Telegraph has penned an article today predicting a crash in those asset prices because the fundamentals just do not stack up any more, perhaps you should check it out? |
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| RJD | Jan 13 2015, 07:59 AM Post #42 |
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Prudence and Thrift
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forget trickle down As I said I do not recall Harold Wilson or Sunny Jim or Saintly Margaret or Major or Blair or Brown claiming such. Once again we see the Strawman tactic of the Usuals. |
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| RJD | Jan 13 2015, 08:06 AM Post #43 |
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Prudence and Thrift
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You make a very crass assumption that because I criticise a program because I find it's claims not substantiated, that I find that the content was designed mainly to rev up prejudice within the Spite and Envy Brigade that I therefore support the status quo. There is no logical basis for you to make such an assumption, but that does not stop you or your ilk. Some people are not interested in proof, cause, effect and what that means to us all. They just trot out the mindless dogma as if it had been found carved on tablets of stone. |
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| papasmurf | Jan 13 2015, 09:43 AM Post #44 |
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Stop doing it then. |
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| RJD | Jan 13 2015, 09:50 AM Post #45 |
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Prudence and Thrift
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Not I Mr Smurf, but you. You are the main culprit here. You avoid facts like the plague, latch onto every straw that suits your dogma and proclaim such as factual. You did not watch that program with an open mind and your understanding of the word forensic, logical and proof makes one wonder at what it is you really do understand. Like you that Reporter did his cause no good, he might have even harmed it. One needs much higher standards of evidence and argument in a Court of Law. That program made the Daily Misery reports look almost academic in quality. |
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| papasmurf | Jan 13 2015, 10:01 AM Post #46 |
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You are the main culprit here,you completely avoid facts, and have been doing so for years. http://www.taxresearch.org.uk/Blog/2015/01/12/cameron-debt-and-misinformation/
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| RJD | Jan 13 2015, 10:05 AM Post #47 |
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Prudence and Thrift
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What is it you think your graph proves? I can see that you are able to copy and paste a graph, but I do not see anything to support your claim? I have never ever disputed those figures only castigated the current lot for making what was a bad situation wrt to debts even worse, so your point is what exactly? |
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| papasmurf | Jan 13 2015, 10:12 AM Post #48 |
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It is bar chart not a graph and the link supports the claim, but as per usual you won't look at it. |
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| RJD | Jan 13 2015, 10:21 AM Post #49 |
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Prudence and Thrift
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I do not follow your links and expect you to be able to articulate your claims. Clearly you find yourself unable and that is why you find it easy to wast other peoples time. If you are not prepared to articulate then why do you come here as any old fool can post links and walk away? Prove your point Mr Smurf with your own words please. By the way I doubt many here follow any of your posted links and I note that a number of people, like myself, feel you are a serial abuser of their time. In short up your game. |
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| papasmurf | Jan 13 2015, 10:27 AM Post #50 |
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Senior Member
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That is why you remain in ignorance RJD, that is your fault not mine. Just for you RJD from that link, the bar chart is the HM Treasury's own data, I expect even that is not good enough for you:- All data is from the HM Treasury Pocket Bank for 30 September. I have extrapolated 2014/15 borrowing form the August data to suggest whole year borrowing of just over £107 billion based on average proportion of total year borrowing to 31 August over the past five years. The conclusions are stark: the Coalition has borrowed more than four times more a year than 3.3 times a year what Labour did, on average. In five years the Coalition has borrowed more than Labour did in 13, by a considerable margin. And there wasn’t an unforeseen banking crisis on the Coalition’s watch. But what’s very odd is the data on gilt yields from the Government. In April 1998 long dated gilts yielded 5.71%. A decade later that was 4.5%. By April 2012 it was 3.31% and in April 2014 this had little changed at 3.46%, but now it is 2.62%. If we had a debt crisis very clearly risk would have increased and so interest rates would have risen. But they haven’t. Interest rates have fallen, significantly, and not just to reflect inflation. So first of all we have no gilt crisis. Second, we have no affordability crisis. And third, we have a lost opportunity to invest at rates lower than we have almost ever known, which lost opportunity is why we have an economic crisis. It’s very hard to see how one man can get as much wrong as David Cameron can in the repeated sentiment he has to offer to the UK. But the evidence is clear: every single word of what he has to say is deeply misleading because it is so wrong. After five years in office all he has learned is that keeping repeating the misinformation is the only policy he can find that he still thinks worth pursuing. And, unfortunately, some still believe him. - See more at: http://www.taxresearch.org.uk/Blog/2015/01/12/cameron-debt-and-misinformation/#sthash.rrFHbMZY.dpuf |
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| RJD | Jan 13 2015, 11:26 AM Post #51 |
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Prudence and Thrift
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Twaddle Mr Smurf. You do not even try to demonstrate that I am ignorant of such data, maybe because you know I have already cited such often here in the past. Secondly you arrogantly assume that your links contain matters of wisdom, my complaint is that far too often in the past they did not, therefore, I will no longer follow them unless first I see good justification to do so. You made the claim that I had claimed something to the opposite of the data provided. Not true and you provide no evidence to support this claim. Best think before you make your claims. Truth is that for a long time now I have been castigating this Gov. for not cutting quick or deep enough and cited the effect of this here some months ago. I am not here to defend anything Mr Cameron or any Politician of any faith has to say, they are big boys they can defend themselves. I only defend what I say and he Mr Smurf you need to withdraw your accusations as you are wrong and you know it. By the way coming from someone who clearly believes in even more borrowing to fund current consumption I find your position on the magnitude of the national debt confusing and somewhat hypocritical. In short if you wish to make claims against me as an individual then I do not expect you to cite words expressed by others. So put up or shut up. |
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| papasmurf | Jan 13 2015, 11:29 AM Post #52 |
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You do that more the adequately for yourself RJD, no assistance from me is needed. |
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| Steve K | Jan 13 2015, 11:34 AM Post #53 |
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Once and future cynic
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But that chart misses two points 1. The £1T increase in net household debt during Labour's time compared with virtually a level position under the coalition 2. That the coalition's borrowing is due to continuation of the main policies of Labour and in fact had Labour stayed in power it would have been even higher |
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| RJD | Jan 13 2015, 11:37 AM Post #54 |
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Prudence and Thrift
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Clearly you are not capable of substantiating your claim and do not have the humility necessary to withdraw. I would not expect more from you. |
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| papasmurf | Jan 13 2015, 11:39 AM Post #55 |
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But I have substantiated it RJD using HM Treasury's own data. |
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| RJD | Jan 13 2015, 11:47 AM Post #56 |
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Prudence and Thrift
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These may be true, but it is also true that for whatever reason this Gov. has not reduced the Public Sector Deficit as much as promised and as a consequence the National Debt has burgeoned. However, it is hypocritical of those that argue against cuts in Public Spending for reasons of dogma to then seek to castigate a Gov. for following their demands. We have seen two big lies in recent weeks: 1). By the Tories that they have reduced the Deficit by 50%. 2). By Labour that the Tory future plans would reduce the size of the Public Sector to levels last seen in the 1930s. I note the Tories have stopped telling their porky but Labour continues to mouth the same old obvious rubbish. The truth is that in real terms it will be, if Osborne keeps his promise which I doubt, ~x10 that of the 1930s and more in line with that of Gordon Brown's 200/02 level of spending. Still Labour know that if you are going to lie then best make it a big one. |
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| Affa | Jan 13 2015, 12:46 PM Post #57 |
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You like conjecture ........ try this. If George Osborne had retired to his home on May 8th 2010 and remained there ever since, never doing a thing on the economy, the economy would now be in a much healthier state than it is now! His policies have stifled growth, prevented expansion. What little growth there has been has been in spite of, not because of his policies. RJD wanted to cut spending much further than has been done, to go deep. Well George wanted to as well but he had brakes on it - the brake of double-dip recession. It was having to avoid returning to recession that stopped George from being more ruthless ...... He should stay away, and allow the Private Sector to get on with makling some money. |
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| papasmurf | Jan 13 2015, 01:27 PM Post #58 |
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Would you care to back that up with a reference please. |
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| RJD | Jan 13 2015, 02:22 PM Post #59 |
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Prudence and Thrift
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Why do you ask me? |
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| RJD | Jan 13 2015, 02:26 PM Post #60 |
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Prudence and Thrift
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Possibly, but that is to be preferred to consuming at the next generations cost which I consider as immoral. Clearly you do not and subscribe to the view that we should take what we want now because we can and hang the future. Do you not realise that by increasing the size of the National Debt we impair our ability to cope with future downturns, recessions, financial tsunamis call them what you will? Or do you believe that boom and bust has been cured? I find your position reprehensible and entirely selfish. Sort of the norm for a Leftist. |
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| krugerman | Jan 13 2015, 02:39 PM Post #61 |
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If I personally decided to lend £1000 to ten people at an interest rate of say 25%, then what has this got to do with the government. ? Although banks and lenders are regulated and have rules and guidelines, there is basically nothing the government can do if a bank with sufficient secure funds, decides to lend millions of pounds in loans and credit to people on low incomes. What I am getting at here is that private or personal debt levels cannot realistically be blamed on governments. Edited by krugerman, Jan 13 2015, 02:40 PM.
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| krugerman | Jan 13 2015, 03:02 PM Post #62 |
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As Loyd Grossman would say "let s look at the evidence" The situation on growth in mid 2009 was that the UK was in recession with growth at -0.2% The UK exited recession towards the end of 2009 with a return to positive growth of +0.4% Growth then accelerated firstly up to +0.6%, then to +0.7%, but then the coalition came along and began immediate cuts, growth then fell back again into negative growth before the end of that year - 2010. Growth under the coalition revived back to the April / May 2010 figure two and half years later at the end of 2012. The question is "did making too many cuts, too deeply, and too quickly cut off growth" ? The answer based on evidence (not assumption or personal opinion) is - Yes it did, and furthermore many top economists forecasted that it would, Alistair Darling said it would, but more importantly Nick Clegg said it would, Vince Cable warned that it would, but of course the Lib Dems changed their minds. The coalition has been wrong on every forecast, wrong in every prediction, wrong in every estimate, and wrong on every economic promise, the Chancellor told us that unless we made the urgent and necessary cuts, we would lose our AAA credit rating, and almost two years ago we lost our AAA credit rating. |
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| Tigger | Jan 13 2015, 09:59 PM Post #63 |
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Are you by any chance practising for the upcoming World Irony Championships being held in Blather City?
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| Tigger | Jan 13 2015, 10:01 PM Post #64 |
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Can you see that nose on your own face? Edited by Tigger, Jan 13 2015, 10:01 PM.
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| C-too | Jan 14 2015, 09:39 AM Post #65 |
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Honourable Member
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1. Does your £1t under Labour include the meltdown years? If so you are posting misleading anti-Labour information. 2. Speculation. I speculate that initial borrowing early on could have seen a quicker reduction in the deficit leading to lower debt. The policies of Labour were cuts and growth running at the same time, the coalition have focussed mainly on cuts. Two quite different policies. |
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| C-too | Jan 14 2015, 03:39 PM Post #66 |
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Honourable Member
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Laffer believes that low/no taxation will be rewarded by trickle-down, he said so on TV. |
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| C-too | Jan 14 2015, 04:08 PM Post #67 |
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Whether Thatcher actually referred to trickle down or not she certainly changed the way people earned their living as the rich got richer and the poor got poorer. If she was not preaching trickle down she was, either practising trickle down economics or she liked the idea of having a very low income/poor level, benefit reliant section in society. Laffer certainly referred to trickle down, and the justification for low taxation has never been to make the rich or the very rich even richer just so they could enjoy an ever better lifestyle. From your website; "Yet free marketeers don’t believe in low taxes because of their effect on spending. They believe in low taxes because they provide a strong incentive to earn more income in the first place. And the best way to earn more in a competitive, dynamic, market economy is to provide goods and services people want. Low taxes can therefore engender the sorts of entrepreneurial activity that enrich our lives through better and cheaper products – the productivity improvements we recognise as economic growth". Two problems, 1. His comment can reasonably be considered to refer to trickle down. 2. 30 years of low taxation failed to produce growth both here in the UK and in the US. It seems to me that innovations were ignored, as too was research and development as people found 'easier' ways of acquiring wealth. |
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| Steve K | Jan 15 2015, 12:21 AM Post #68 |
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Once and future cynic
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No as you should ave remembered from the previous discussion. Remember this is household debt we are talking about. Here's the chart again ![]() So seems I'm actually continuing to post dead accurate anti New-Labour information |
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| Steve K | Jan 15 2015, 12:26 AM Post #69 |
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Once and future cynic
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Perhaps you do not understand GDP. What impact do you think the massive QE of 2009 would have on GDP? And remember they dumped an extra £200B of made up money into the economy between March and November 2009. - reduce it? - maintain it? - give a short term boost in the run up to an election and just beyond? There is an obvious No shit Sherlock answer in there. |
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| Affa | Jan 15 2015, 01:49 AM Post #70 |
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G Osborne got what for £150bn QE investment? He certainly didn't get a GDP boost ... which rather suggests its how QE money is utilised, and not by itself an injection of product .......... and George got more from that earlier investment than Darling did ...... he cashed in the BoE QE profits claiming £35bn as his own. Without which his deficit reduction plan was in tatters. |
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| C-too | Jan 15 2015, 10:45 AM Post #71 |
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I apologise and stand corrected. IMO personal debt is not and was not the Problem and is therefor not anti-Labour. Government debt/deficit is the problem. Edited by C-too, Jan 15 2015, 10:52 AM.
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| C-too | Jan 15 2015, 10:56 AM Post #72 |
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Honourable Member
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Or use it to avoid a recession turning into a 1930s style depression. Perhaps your insinuated answer is politically coloured? |
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| RJD | Jan 15 2015, 10:57 AM Post #73 |
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Prudence and Thrift
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Yes that is the inference of his statements, but I do not see how one can take this as the claim of Politicians and Economists in such a generalised way over such a long period. I do not recall Gordon Brown making such claims. There is no proof that there is zero trickle down, only that it is insufficient. These obscenely rich people buy their stuff somewhere from others and that in turn creates employments. There is no proof, provided by that program, that we could attach ourselves to the wealth of the Billionaires cited. Clearly the majority were not Brits and had not created such wealth here. That program did not even bother to analyse why it is, on a global basis, that capital and skills have done well over the decades and those with no-skills badly. It was far too busy revving up envy and spite by images of fabulously rich (Non-Doms) buying very expensive toys with the backdrop of Benefits Street. I found the program rather shallow. Hope it improves, but doubt it. |
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| RJD | Jan 15 2015, 11:02 AM Post #74 |
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Prudence and Thrift
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Are you not concerned about the QE process and the potential future impacts? The solution should not be one that just pushes the problem down the line and causes major difficulties for others at a later date. QE has risks and views are very split as to the magnitude of these, what is clear is that we are sailing the Ship-of-State without a compass and hoping for a safe landing and in the mean time doing little to repair the past damage. |
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| C-too | Jan 15 2015, 11:12 AM Post #75 |
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Trickle down wasn't inferred by Laffer it was stated by him. Whether or not others have spoken in terms of trickle down the reality is that high taxation disappeared 30 years ago and during the 18 years of Tory administration the rich get richer and the poor get poorer. When NL attempted to alleviate the lot of the poor they were accused of feeding fat nanny wasting other people's money. |
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| C-too | Jan 15 2015, 11:15 AM Post #76 |
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Honourable Member
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I suppose the question is, which is or would be worse QE or a 1930s style depression? Both have knock on problems that probably would not be fully sorted in one generation. |
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| RJD | Jan 15 2015, 11:26 AM Post #77 |
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Prudence and Thrift
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Is your claim that Laffer was wrong? Do you claim that an economy of high taxation is fundamentally fairer and better than one with more modest rates? If you do then you best find the evidence in the period 1997 to 2010 when the rich plus those with skills in the UK improved their lot, the vast majority without such did not and State spending burgeoned to around 50% of the economy. You also have to show why it was that in the 1980s reductions in tax thresholds were accompanied by increases in tax revenues. My position is that real jobs are the best social salve, hopefully ones with increasing disposable income and all the evidence indicates that those economies with a lighter (note I do not say zero) tax load tend to produce more of these and employ a greater proportion of the populous. What is important is GDP/Capita and the portion of this that individuals are allowed to dispose of of their own free will. Me I think the ratio is nearer 40% or lower you no doubt think it is 50% or higher. Back to the disparities created over the last decades I am yet to see a solution declared from the lhs. Has anyone actually run their slide-rule over the numbers and determined how much more you expect to take from the top 10% say? I say it's around £20b PA, but is that possible? As for the Non-Doms forget it, they came and will leave as a pack when that suits them, not us. |
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| Affa | Jan 15 2015, 11:39 AM Post #78 |
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Turn the trickle into a stream ........ taxation is not the best way to do this, but when the top earners put filters in the path of the flow it's either remove the filters or higher taxes. Don't blame government for a problem (wealth gap) that has greed as its cause, economic damage as its result, and falling standards of living as a consequence. |
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| RJD | Jan 15 2015, 12:17 PM Post #79 |
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Prudence and Thrift
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How? After a few years of asking I have seen nothing from the left on how to move £20b PA from the top to the bottom in a sustainable manner. Forget the Non-Doms as they will p155 off as quickly as they came, they haver no long term loyalty to the UK, so where are you going to get the £20b from? Get your Calculator out. The middle income group feel they have been squeezed too much, so that leaves the very narrow tax base of the top 10% say. Do you think you can squeeze them for £20b, every year? |
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