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Sounds right in your ears?
Topic Started: Jan 27 2015, 08:27 AM (835 Views)
RJD
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Prudence and Thrift
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Sometimes the "sounds right in my ears so must be true Brigade" accept claims without first checking that they have some substance. Take the claim that the inequality between rich and poor has restricted growth, they offer no substance to support this but trail it around as a fact and then demand that taxes must be increased on those that have wealth to narrow the gap. The argument for narrowing can be made on other grounds, but there is no proof that there are economic gains to be had. Read this:


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In fact, an economy will grow, or not grow, based on a whole range of factors. In rough order, the most important are demographics, productivity, the rate of technological change, the labour participation rate, how big the state is, how much taxes punish enterprise, and how free and deregulated its markets are. How equal or unequal they are has nothing to do with it. No one would argue that more inequality creates faster growth. There is no evidence for that either. But neither does it reduce it.


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The first argument is that the rich, in the economic jargon, have a lower propensity to spend than the poor. For every extra £1,000 they earn, a fabulously wealthy person might spend very little of it, mostly because they have run out of stuff to buy, whereas a much poorer person will probably spend all of it, mainly because there is lots of stuff they need


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The trouble is, it is nonsense. Sure, the very rich don’t spend all their money. They save quite a bit of it. But neither do they stuff their money under the mattress. They either put it in the bank, and the bank will then lend it to people who do want it, or else they will invest it, and the money will go into a growing business which is creating jobs and wealth. The important point is that one way or another, money always gets spent, and feeds its way back into the economy. Whether it starts out in the hands of richer or poorer people doesn’t make any difference one way or another.


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The second main argument is that strong post-Second World War economic growth coincided with a period of narrowing inequality. In fairness, that’s true. But it is just a co-incidence. Post Second World War growth was the result of rapid technological change which boosted productivity, falling barriers to trade, and, a factor that is often over-looked, women re-joining the workforce on a massive scale. Equality didn’t have anything to do with it. Worse, that ignores the fact that 19th century growth, which sparked the industrial revolution, coincided with widening gulfs between the rich and poor. It also ignores the fact that some of the fastest-growing economies in the world right now are also some of the most unequal. The UK is regularly cited as a relatively unequal society compared to the rest of Europe – but it is growing faster than its rivals. Singapore and Hong Kong regularly top the inequality league tables – but neither of them are exactly slouches when it comes to rapid growth.


LINK- Lagarde is wrong

I believe there is a moral case here in the UK to shift ~£20b PA from the top to the bottom in a sustainable manner, but thus far nobody has shown how this can be achieved without a negative effect on the economy. Therefore the intellectually honest response is "hang the economy", but instead the left prefer the outpourings of the Red Nag Myth Factory as that chimes well in their ears.



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papasmurf
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The benefit cap Full Fact analysis, just the conclusion:-

https://fullfact.org/spotlight/economy/benefit_cap-38662

The assessment

So is the cap working?

The cap has had a small effect on the number of claimants.

In terms of savings, the policy reduced the benefits bill for the 27,000 families that were capped in late 2013 by about £100 million. The IFS say that the current benefit cap will save less than £200 million in 2015/16.

To put this figure into context, total spending on housing benefits alone in 2015–16 is forecast to be £26 billion.

But part of the policy is that no one should get more in benefits than the median working family receives in net earnings. From this point of view, a number of people have certainly had their income from benefits reduced.

However, the majority of those capped haven’t found work, and haven’t moved to cheaper accommodation. The IFS, http://www.ifs.org.uk/publications/7482

says that: “For this majority, it remains an open question as to how they adjusted to what were, in many cases, very large reductions in their income”.
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Rich
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"“For this majority, it remains an open question as to how they adjusted to what were, in many cases, very large reductions in their income”.

Do you have an answer to the above "open question" Papa? please only give facts and not guesswork and small examples of your own neighbourhood.
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papasmurf
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Rich
Jan 31 2015, 01:14 AM
"“For this majority, it remains an open question as to how they adjusted to what were, in many cases, very large reductions in their income”.

That is just what it states on the tin, but the massive increase in food bank use is a bit of a clue.
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Steve K
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Once and future cynic
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papasmurf
Jan 31 2015, 09:08 AM
Rich
Jan 31 2015, 01:14 AM
"“For this majority, it remains an open question as to how they adjusted to what were, in many cases, very large reductions in their income”.

That is just what it states on the tin, but the massive increase in food bank use is a bit of a clue.

The massive increase in publicity about food banks and their accessibility is a bit of a clue too

papasmurf
Jan 30 2015, 09:53 PM
The benefit cap Full Fact analysis, just the conclusion:-

https://fullfact.org/spotlight/economy/benefit_cap-38662

. . [/i]

Very good read, thanks. Some content to question the policy but nothing to back your allegation of IDS and Cameron being liars.


Edited by Steve K, Jan 31 2015, 01:36 PM.
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papasmurf
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Steve K
Jan 31 2015, 01:35 PM

Very good read, thanks. Some content to question the policy but nothing to back your allegation of IDS and Cameron being liars.


There has been no "Stampede to the Jobcentre" so they are both liars.
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RJD
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papasmurf
Jan 30 2015, 09:37 PM
RJD
Jan 30 2015, 05:34 PM

By the way the graph on page 11 shows and income distribution and does not equate this to absolute poverty.
Well given how many millions are the wrong side of £300 a week mark with a significant number with next to (expletive deleted) all a week to live on, just how little a week do you think people need to keep a roof over their head and eat properly?
You made the reference and it was, again, uninformative. Your addiction is fed by any little scrap that you perceive provides your claims with sustenance, however, they do not pass for scientific analysis.

As for "eating properly" whatever can this mean? Some Nutritionists would have us eating a significantly less on what you would describe as starvation rations. The UK does not have an epidemic of people who are under-nourished, quite the opposite.
As for roofs over heads you are aware of the obligations of Local Gov. in this matter.


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Steve K
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papasmurf
Jan 31 2015, 01:40 PM
Steve K
Jan 31 2015, 01:35 PM

Very good read, thanks. Some content to question the policy but nothing to back your allegation of IDS and Cameron being liars.


There has been no "Stampede to the Jobcentre" so they are both liars.
Yet again you prove that you and the English language are foreigners to each other so by your own theories you should be deported. Shut the door on your way out

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papasmurf
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Steve K
Jan 31 2015, 02:11 PM
Yet again you prove that you and the English language are foreigners to each other so by your own theories you should be deported.
You and several others on this forum obviously prefer to be lied to by Cameron, Osborne, and Iain Duncan Smith, than to face the truth of what they are doing.
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RJD
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Prudence and Thrift
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papasmurf
Jan 31 2015, 02:33 PM
Steve K
Jan 31 2015, 02:11 PM
Yet again you prove that you and the English language are foreigners to each other so by your own theories you should be deported.
You and several others on this forum obviously prefer to be lied to by Cameron, Osborne, and Iain Duncan Smith, than to face the truth of what they are doing.
No we just don't by into the BS spouted by you.
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Steve K
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Seconded

You'd think if someone was fed up with it being pointed out hat they post hyperbole, untruths, death threats to politicians, false stories, misuse of simple English words and references that don't support their position then they'd take the easy route and desist from doing same.
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RJD
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Prudence and Thrift
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Steve K
Jan 31 2015, 02:49 PM
Seconded

You'd think if someone was fed up with it being pointed out hat they post hyperbole, untruths, death threats to politicians, false stories, misuse of simple English words and references that don't support their position then they'd take the easy route and desist from doing same.
Sometimes it is necessary to wonder whether these people are sane. I now view Mr Smurf like a man in Hyde Park with a board proclaiming "The End is Nigh", he was there for years, maybe decades, and the message never changed. It is also getting very tiresome that he seeks to infect every thread on this forum with his addiction. Probably the reason why the forum is slipping into the Doldrums and a number of interesting Posters has dwindled. This forum has a canker.


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ACH1967
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papasmurf
Jan 30 2015, 04:27 PM
ACH1967
Jan 30 2015, 03:47 PM
What is truly boring is your evasion on this topic when asked.

If it is that simple why don't you tell us?
There is no evasion involved, I suggest you find a family who end up at a food bank, and get their financial details, and try and see if you can get them out of the poo.
What you are finding so difficult to comprehend about the close to the edge financial difficulty 18 million people are currently in I personally find incomprehensible. You must be like Cameron, Osborne and Iain Duncan Smith living in an insulated bubble from the reality facing many people around you.

I suggest looking at the chart on page 11 of this and at the very low income levels of millions of people. It does not take a worked out individual example to see the size of the problem. (That so many people have an income far below a level that even you must be able to see is causing serious problems is a national disgrace)

http://www.ifs.org.uk/comms/comm124.pdf
I suggest you answer the (expletive deleted) question rather than continue to evade.
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