The way the Conservatives transformed a crisis of the banks into a crisis of public spending was a stroke of political genius. This year, bankers got away with awarding themselves nearly £14bn

Meanwhile this explains bank bonuses to us very well, I think.

I have no respect for the Tory party making cuts based on ideology then trying to dress them up as being The Only Way. Don't be ridiculous.

They ignore evidence of what works (eg the NHS being incredibly efficient and competition does no good in improving the health service), telling half-truths (I pisses myself when Gideon was asked how he'd be affected by the cut in child benefit, oh like he'd even notice).

At least have the balls to call it like it is.

I really despair about what the Tories are doing to this country, I really do.

Quite so amberleaf. See this chart for the historical picture on public borrowing. And note also that the steep spike recently happens as the result of the financial crisis, not as the result of profligate public spending by the Labour party.

But niceguy, there is always a deficit, we never live within our means, its not new!

Why do people not understand this?

Back to the OP, two separate issues, the banking crisis and public spending have been linked because cutting public spending is the government's preferred way of dealing with the crisis (whatever its causes). It prefers to cut public spending (rather than raise taxes) because it wants to privatise services. It wants to privatise services because it wants to cut the costs for government while boosting the private sector.

I've tried to put this as neutrally as possible (to get it clear in my own mind). What is so sad imo is that parts of the media and the government seem to be trying to make everyone hate the public sector (in order to gain support for the government cuts). Meanwhile the rest of us are furious at having to bear the brunt of a crisis that we blame the banks for creating.

I think our society is becoming dangerously fragmented - and we are all to blame for that. We've got to stop playing their game.

barbie Germany did not keep their banks under control.

Far from it.

Irish citizens are expected to pay off the debts of Irish private banks because German banks (among others) thought it sensible to lend tens of billions of pounds to mad outfits like Anglo Irish Bank.

The German economy has been doing OK because the Euro was set up in such a fashion as to massively advantage the centre at the expense of the periphery (see the recent decision to raise interest rates despite the pain this would inflict on several peripheral countries), but their banks are no better than ours. Which is dangerously out of control and about to cause another crisis that won't affect them but will fuck the rest of us.

Another bash the Tories/bankers thread.

It's all the nasty Tories fault, they are the devil incarnate. Fancy trying to make us live within our means eh? The bastards!

Cue lots of posts which basically say:

• Well everyone else was overspending so where's the problem?
• Our friends all borrowed more than us so where's the problem? (erm they're all cutting back too)
• It's all the rich bankers fault! (Erm...naive to think they did it single handly but a grain of truth)

We know the financial crisis was caused by worldwide failure (except Germany) to keep the banks under control. Shareholders rule the world, but only if governments let them.

I don't think any self-respecting human being that actually USES public services and perhaps reads a local paper etc, would accuse them of being spendthrift, greedy and lazy. The Guardian likes to think the public think that but the Guardian has low expectations of the public.

Public spending needs to be balanced, but cutting it hard is a disaster because public sector workers, unlike bankers, don't take their money abroad or spend it on fabulously expensive houses - they spend it on the normal things that keep our country's economy going.

In the end something needs to be cut - how about everyone with over £1M in capital giving some of their additional capital assets and investments? Not income- that always disappears. I can think of a few ideas.

I think the bizarre assumption that the PUBLIC make (not the Guardian) is that somehow people should never need support, or even deserve what they get. If their life is in the doghouse, it's their fault and they shouldn't be expecting handouts. I am always horrified by the lack of empathy you find for people who can't cope for whatever reason. Work ethic is good, but not being able to accept people's failure to cope seems to have become the subtle new public face of toryism.

'Handouts' (typical nasty media word for support) is what we pay tax for. For those times when we need help. It's a part of every society - often families help each other out, but in this country we choose to support each other through tax, because we tried the other way 100 years ago and it didn't work.

It would also help if public sector workers leaked information to the press about the cuts, they knew about them a much longer time ago but aren't able to leak information because they would lose their jobs if they did that. As nana says, it has taken far too long for the public to twig this is going on.

Labour Party head office is really sending the troops into MN at the moment aren't they? Can't be bothered reading the Politics Board any more for the wall-to-wall anti-government propaganda

Please excuse my total ignorance. Money is boring, it's not even real. If we are in debt who do we owe money to? Who does America owe money to? Who does the rest of the work owe money to? We can't all be owing money. It makes absolutely no sense whatsoever. But the answer is always waffle waffle waffle that makes no sense whatsoever. Please someone explain it to me in a simple way because I'm obviously a bit stupid.

Bond vigilantes again, is it?

Yes, must keep those imaginary bogey men appeased at all costs.

"it's not us guvnor, it's the markets. They are forcing us to follow policies that lead to high unemployment. Stimulate demand? The BVs would never let us do that. We have no choice but to fuck the poor and middle classes while we attempt to cut our way out of a recession, all the while making the problem worse."

Fuck the fucking Tories. Bastards of the highest order. I swear people voted for them because they though they would get rid of the foreigners whilst not realising that the fucking Tories would destroy you if you did not have a pot to piss in.

Fuck the Tories and all that they stand for. Fuck all that vote for the Tories. I can't stand you people, so do not care to make/be friends with you.

HATE the bastard Tories.

Off to bed. Night all.

True SWC, those who suggest only halving the deficit are choosing to play russian roulette with the bond market

Some people just aren't prepared to listen to reason because it's easier just to blame everything on the "evil tories" and the "evil bankers" rather than face the reality that we as a country have been living beyond our means for well over a decade. There are a lot of people living middle-class lifestyles on working-class incomes that are going to have to reevaluate how they see themselves in coming years.

I don't agree with the OPs opening point. At the end of the last financial year the Government had a budget deficit of £155 billion, in that particular financial year there were no bailouts to the banks from the Government. The truth is the Government had been running a deficit in times of strong economic growth and once the hard times hit this was excerbated to the point now when we have an eye-watering deficit between Government spending and tax revenue. The banks were of course partly responsible for this but this country has not had a responsible fiscal position for some time and the Government is thankfully adressing this, it is painful but the Government cannot endlessly live beyond its means

Do you not think the economic boom that paid for all the increases in public spending had something to do with the "pesky banking types" as well?

The Guardian article seems to want to connect two unrelated topics. I also don't really why banker's bonuses have a bearing on the public sector. Banker bonuses may be obscene (or not) but does that mean that the public sector can't be held to account?

Also the numbers in the Guardian article are not even accurate. If you check the actual report www.statistics.gov.uk/articles/nojournal/bonuses-2010.pdf the £14bn refers to all financial and insurance activities in the UK, not only banks as the Guardian suggests. That includes banks but also insurance, fund management, hedge funds, mutuals etc.

From other reports, see www.financemarkets.co.uk/2010/10/05/city-bankers-to-receive-7bn-bonuses-this-year/, bank bonuses are around £7bn, down from £11bn in 2007.

I don't see what business it is for the public to complain about what asset managers or hedge funds pay their people as they didn't take any public money (then again neither did many banks but whatever).

Riven - yes, of course it will. But it'll be dressed up with weasel words about 'efficiency'. While actually the truth is it's about making fat profits for Gideon and David's mates. Mark Britnell, former Dept of Health policy wonk, let the cat out of the bag at a seminar for fat cats in the US when he promised the NHS wouldn't know what had hit it - because it's all going to be carved up into 'profit centres' for the likes of Capita, G4S and KPMG.

Good explanation on that site, Sproggaaaaah.