Which is more important now: political reform or the economy?

what did the Soviet Union have to do with socialism? apart from maybe 1917-21 and that is highly arguable. it was state capitalism, have a look at China for another great example of state capitalism. the soviet system was supported by apparatchiks who parroted prevailing ideology, bit like this thread.

The Tories and Labour are just the politburo in disguise, or alternatively, they are a boardroom with competing managers. but their god is capital. they hate the distant prospect of democracy.

if you want a quicker way to have a balanced economy, not a perfect one, a more balanced one, then it is Scandinavia...

The idea that European democracies should be dictated to by speculators is just loathsome. I'm amazed that any of you think this is OK. Do you actually believe in democracy at all?

I think that you could overplay the Capital Mkts arument. As I argued, the UK economy is heading for adjustment anyway and the pound fell big time in the last 18mths and the biggest impact was persistent inflation and less overseas holidays

TDiddy

A depreciating currency is definitely a sign of a weak economy but it also helps to mend it, by encouraging exports.

Greece is trapped in the Euro for political reasons, not economic ones. All economic sense says it should leave the Euro instantly.

Haven't we all noticed that our currency dropped 25pc or so over the last year (not exact fall but it was significant). Another 25pc would hurt but it would bring our economy into better equilibium i.e. recognise that we are all poorer in dollar/gold terms?

Britain, socialists in fact, built the NHS and free education in the rubble of WW2. In a much poorer country. Without recourse to unregulated debt markets.
The right have been trying to destroy those basic building blocks of democracy since then. The idea that private banking should be allowed to control our country, or any other, is outrageous. again it shows how much the faint prospect of democracy is despised by the right. they would rather the country was run by HSBC and RBS.
banking should not be allowed to be in private hands, period. it is far too dangerous, as recent events have underlined.
i'm not holding my breath however, and you might want to think what will happen in the next recession. what will be left to cut?
and there is no such thing as middle class, everyone who sells their labour is working class. about 99pc of us.

Savage public sector cuts so beloved of Thatcherites will reduce tax take quicker than anything else.

"tax the rich". And do you honestly think that will be enough? Just how much tax do you propose to take from the "rich" and what is your definition of "rich"? Given that only 10% of the population earns more than £50k a year. And while you can tax the middle earners the reality is that the higher earners (ie those earning millions) will only tolerate giving up so much of their income before they decide to call it a day and leave the country taking any revenue with them.

Greece has the option to leave the euro. We on the ther hand do not. Our currency is our own, and the more unstable our economy becomes, the less our currency is worth.

And the stock market rally before this was always dubious. Everyone was waving on the trigger event for the wave of sovereign default anyway...I mean all those debts didn't disappear overnight but in fact govts are caught holding the parcel so the underlying pressure is there regardless of which govt is in power.

There are lots and lots of loans that are due for refinancing that could come unstuck and result in another wave of melt down e.g. Commercial Property Loans CMBS structures

"they hate the prospect of ordinary people controlling fiscal procedures, political procedures"

how much control did the worker Josef Soapski have in the Soviet Union? As soon as he piped up and asked for control, he was given a one-way trip to a Siberian gulag.

I agree that the two are not mutually exclusive:

Also the falling pound is arguably part of inevitable adjustment. The election uncertainty is just one of the evnts that could trigger this adjustment. In fact the Govnor of the BoE spent much of last year talking down the pound; I suspect they see/saw it as part of inevitable fiscal rebalancing...

Persistent low interest rates even with inflation pressure tells me that there is an element of us inflating our way out of our debts. I am not classically trained economist but I believe there is an element of that happening?

The UK deficit, the cuts in public services, are a direct result of 30 years of neo-liberalism, supported by Labour, the Tories. The private sector collapsed and demanded the state bailed it out.

There is always a need for a dynamic economy which balances budgets. But the desire for credit was fuelled by a right wing utopian ideal of endless growth, no limits to growth and so on.

Without the finances of the state we would have ended up in front-line capitalism, like Somalia or Cote D'ivoire. Where men with machetes take it all.

The Anglo Saxon economies, which are built on zero regulation, market economies and so on, have been failing since 1989.

But despite all this, it's so interesting to see how much the right despise democracy, how they would sell sovereignty to banking, to multi-nationals. they hate the prospect of ordinary people controlling fiscal procedures, political procedures. this is how the right operates in the post-fascist era.

"Oh, and introduce international financial regulation that would put all the speculators out of business. And strip the investment banks down to size. And reassert the power of central banks."

at what point should we invite the IMF in?

I agree that Greece should withdraw from the Euro. Why they don't let the currency take a large part of the pain, instead of the people - just for the sake of a failed European political project, is beyond me.

If it defaults, though, no-one will lend to it, at least for a few years.

Not good when spending is more than tax take.

"we should tax the rich"
but will Tony and Cherie, Ruth Kelly and the union bosses on their £200,000 salaries accept being taxed higher?

Oh, and introduce international financial regulation that would put all the speculators out of business. And strip the investment banks down to size. And reassert the power of central banks.

"So you think we should just keep borrowing and spending at exactly the same rate, change nothing and watch as the country disappears down the toilet? Isn't that cutting off your nose to spite your face?"

Chil1234, that's an excellent summation of Labour party policy

Greece can withdraw from the Euro and default. And if it did, everyone who believes in proper democracy - rather than the pus-riddled plutocracy that's been developed by Thatcherites over the last 30 years - will laugh like drains.

As to what we should do - why, we should tax the rich! While reforming the electoral system. Simples.

Unfortunately, sound money - not going on borrowing binges - is a fundamentally conservative principle, not a socialist one.

So you think we should just keep borrowing and spending at exactly the same rate, change nothing and watch as the country disappears down the toilet? Isn't that cutting off your nose to spite your face?