'Things Can Only Get Better'

I would say I am broadly anti-statist. I would prefer to reduce the size and scope of the state to a minimum.

Encourage citizens to take responsibility their actions and provide for themselves where possible, to not interfere with personal freedoms unless absolutely necessary, and to take as little as possible from them in terms of taxation.

Well said Cinnamontoast. Nurses, police officers, prison wardens, social workers, people employed by charities, nurses and teachers have all got difficult and demanding jobs. Their pay is lower than many jobs in the private sector but this has traditionally been offset by job security.

Can we get some diversity officer and community cohesion managers (are you sure about that one, Siasi) to defend themselves against the claim that they do nothing at all? Funny that, when everyone else in the public sector is so overstretched - social workers, nurses and teachers to name but a few.

I think i love you minimathmouse
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There is a simple answers to our woes then, the government could spend this 53.4% of GDP investing in the private sector and making banks lend to small businesses.

This would generate jobs in the private sector. Perhaps we could all then export these good to (where? poorer countries) and then GDP would rise. Done. Siasl are you anti public sector? I am not and believe that capitalism is creating world poverty and hunger and ruining our planet.

Perhaps you'd prefer it if it was 100% and we just call it each other 'comrade'

Riven

Gross domestic product (GDP) is a measure of a country's overall economic output. It is the market value of all final goods and services made within the borders of a country in a year.

As the % of GDP due to the public sector goes up this means the private sector is becoming less and less relevant ('crowding out'). So the other 46% is the private sector.

State spending now accounts for 53.4% of UK GDP as compared to less than 40% when Labour came to power (ONS data). I'm Australian and by comparison the equivalent there is 36.6%. The US is 41.5%.

I'm talking about an increasing public sector crowding out the private sector. Unnecessary 'middle class' jobs in the public sector for diversity officers, community cohesion managers, directors of transformation ... Basically paying people £40k/year+ and a final salary pension for doing nothing useful at all.

Perhaps if we spent the money on getting the unemployed back to work rather than creating more state bureaucracy the UK might start getting somewhere.

No one has mentione dte role of teh Bank of England.

Eddie George (former Bank of England Governor) gave this very revealing interview a few years before he died.

"The Bank of England deliberately stoked the consumer boom that has led to record house prices and personal debt in order to avert a recession, the former Bank Governor Eddie George admitted yesterday.

Lord George said he and his colleagues on the Monetary Policy Committee "did not have much of a choice" as they battled to prevent the UK being dragged into a worldwide economic slump by slashing interest rates. And he said his legacy to the current MPC was to "sort out" the problems he had caused."

Very loose monetary policy fuelled an unsustainable borrowing binge that fuelled house price growth and it was a quite deliberate policy to engender a 'feel good factor'. In my view, interest rates should have been raised sharply in 2003 just before he left office to cut off the flow of credit. It would have caused a house price drop but nothing like the one we are about to see and we would have avoided the appaling credit crunch we have seen. We would also be back to economic growth again by now. Instead, loose monetray policy carried on disasterously for 4 more years.

• i.e. referring to your comment 'Labour has effectively created a dependent client state', Siasi.

Siasi, I think you'll find that the Tories created a benefits culture during the Thatcher years, making people dependent on the state - by killing off industry and putting millions on the dole with no hope of a job. To talk about public sector jobs created by Labour in the same terms is a nonsense. And house price inflation took off in the Thatcher years too, along with the pressure for everyone to own their own house.

I agree that laxer credit has been a 20y+ phenomena.

The decision to increase the size of the state, however, was Labour's folly. It's just ridiculous that now in many parts of the country the public sector is a bigger employer than the private sector.

That was Labour's big idea ... ensuring that in these areas people would have to vote for them or potentially lose their jobs.

I absolutely agree that the Government sets the tone for their age and for ages thereafter. I firmly believe that the "have it now" and the utter desperation for people to own their own homes at whatever cost is a result of the previous Tory government. That is when it changed. Easily available credit simply made appear to be within everyone's grasp. That did not start under the last Labour government.

The difference between Labour and the Tories would not have been Iraq or City regulation - they would have been the same.

The difference between them would that rather than spending like crazy in the good times like Labour did, the Tories would have probably reduced public sector debt, shrunk public sector spending and reduced the tax burden. Once the cyclical downturn hit they could have increased public sector debt, hired people and even raised additional tax revenue.

The problem is that Gordon Brown said that "Boom and Bust" was gone forever. What a twit! Were the public so deluded that they actually believed the standard of living in the UK was going up as fast as it did in the last decade? Did they really not realize it was a debt driven illusion?

Agreed, the Torries want to shrink the public sector and the need to make cuts feeds into their ideology. I just question how front line services being axed, class sizes rising, sacking TA's in schools, cutting budgets in social work dept's will make life easier for the growing numbers of soon to be unemployed people. Add this to lack of funding for teacher training and social work and we are just storing up problems for the future.

I have lost count of the times I have heard Vinnie the weasel say the banks have been greedy and must pay. I don't see too many bankers needing help from social work depts, state schooling, NHS and all these other services that will be effected.

They have not seen the light. They will do that "burying bad news" thing that they are doing already. So the speeches referencing benefits cap was pushed aside as everyone talked about child ben. The budget they put about it was going to be awful and then they didn't do much (I was a bit about it TBH) so everyone is so relieved they forget to look at the detail. they are doing the same with this spending review.

They have seen the light? Hahahaha seriously this is all ideologically driven. This is what they would be doing even if there were no recession / defecit / etc.

They are backing down a bit. Are they surprised by the response to the child benefit proposal or have they seen the light. Some economist are saying that we are headed into a double dip resession. Maybe Osbourne and Co have realised that the private sector will not grow and employ redundant public sector workers in the near future.

Let's wait and see on that shall we Siasl.

The Tories are already backing away from cutting back as much as they initially wanted.

Retrenchment of public sector workers costs a fortune in redundancy payments due to poorly designed contracts. Cuts are also going to damage aggregate demand. It's very questionable whether the private sector can really offset the damage.

That's the problem with addiction to debt. The withdrawal symptoms might hurt you as much as carrying on with the spending spree.

But if we do cut back at least it'll be us taking the pain, rather than carrying on borrowing against our children's future.

I wonder if the torries are prepared for the huge rush on welfare payment.
They can make cuts to the benefits paid to each family, will these saving not be offset by the increase in claimants?

Less money in my pocket, means less demand for goods to be produced, equals no demand for someones labour. The less we spend, the less job security for someone else, here and abroad.

Labour has effectively created a dependent client state over the past 13 years.

It artificially suppressed unemployment through the mechanisms of increasing public sector jobs and uni education. It encouraged consumption by pushing public sector pay and pensions out of line with inflation and providing benefits (tax credits, HB) to families already earning more than the average household income.

The combination has pushed up the cost of living (house prices, rents) making the UK far less competitive. It has left swaths of uni grads with large debt and no graduate jobs. Its created a huge structural deficit that is now made worse by the cyclical impact of the global downturn.

A large proportion of the country is now so dependent on the state that its very hard for them to change.

Did Labour do this deliberately in the knowledge that the state junkies they created would have to vote Labour? Perhaps.

Sub-prime Mortgage market created by Golman Sachs, packaged up and sold onto the ordinary high street banks. I don't think the coservatives could have seen this coming any more than labour.

Globalization and the free market economy rules the world, political parties, democracy, elections, all window dressing to keep us compliant.

But how can anyone possibly know what a conservative govt would have done when v cheap credit was dangled in front of its nose. There are plenty of things that tories like to spend money on - army/defence, tax cuts and breaks, incentives for businesses to set up here etc etc.

You can't know that things would have been particularly different.