to think public service broadcasters would do well to stop ridiculing anyone with even vaguely leftwing economic ideas?

[SweetBeadieRussell]

Since Ed Miliband became leader of the labour party the problem seems to be getting worse.

I can't switch on the Radio or TV without hearing 'unbiased'publicly funded broadcasters repeating endlessly 'And of course the press are already calling him 'Red Ed'' (Really? Well as i don't read the tabloids I would have been blissfully unaware of the fact if you hadn't just repeated it eight times during the Today programme!)

and 'Of course what he can't start doing is just opposing the spending cuts' or 'Is Ed Miliband going to lead Labour on a Lurch to the Left?' 'Is he in danger of driving away mainstream voters?' John Humphreys, i'm looking at you in particular.

I feel like yelling 'I'm a mainstream voter and i'd gladly vote for him, if only he'd promise to sell off the publicly owned banks now, while there's a profit to be made for us, and cover the bulk of the budget deficit that way, instead of selling off my dc's education to the highest bidder as the coalition insists!'

Last night took the biscuit, I couldn't even sit through 5 minutes of 'What's The Point of the Unions?' on Channel 4 - all grainy hidden cameras and 'Bob Crow and the unions have the power to hold the country to ransom through strikes, this is utterly undemocratic etc' Yes, like the utterly undemocratic banks held our country to ransom, and they weren't even doing it to demand fair pay, or rights for workers or anything remotely principled, why aren't you piping the scary music in their direction?

We may as well let Rupert Murdoch and his son get their way and force the BBC and C4 to be sold off because as far as I can see they're already setting the entire agenda.

Socialist principles are now publicly derided from every corner, whether or not the organisation deriding them was set up under those very socialist priniciples or not. Any debate about economic ideas must be conducted within such narrow principles in order to avoid being laughed off the airwaves it's almost not worth having.

huddspur - i accept that cuts are necessary in order to maintain our triple A rating - however, don't you worry that this merely perpetuates the cycle in the long term - just as individuals (and i'm no exception here) keep an eye on their credit rating with a view to future borrowing?

Sweetbeadie- I agree with most of what you're saying. I find the view that this way is the only way idiotic, I'm in economics at the moment and it is infuriating that Keynesian economics has been completely swept away, and simple models that have been successful onthe past are not being utilised.
One thing that pisses me off is that it's NOT the only way- I think what we need is to float the exchange rate (to make us more attractive to the rest of Europe) and be piling money into our export markets.
The trouble with these cuts is that it is suffocating business and entrepreneurship, raising the echange rate and rendering our goods and services null.
Have you looked into supply side policy? It's pretty intresting, although debatable whether the country is strong enough yet

Hedgeblunder - here's where i search blindly for the 'out of my depth' emoticon and confess that i am a philosophy grad with only a tenuos grip on economics!

I agree the Keynesian model has met with an untimely end but other than that I defer to your superior knowledge on this one. I havent heard of supply side policy, do explain...

It's basically targetted government spending to improve productivity and to increase aggregate supply. It is based on free Market rules (which the conservatives love) but also benefits from low inflation, low unemployment, stable economic growth, and a improvement in the balance of payments (the deficit) and trade.
It's Pro privatisation (selling back the banks), increased education, lowered barriers to trade And lowers welfare benefits (which is why most politicians are scared of it!)

but basically it achieves what needs to be done, but while boosting the cash flow, rather than the conservatives building a golden tomb and sealing us all in with them!

Hedgeblunder, this targeted government spending sounds interesting. Can you give us examples of what the money would be spent on with this model and how that would help reduce the deficit?

Going back to SBR's original post, I haven't noticed open ridicule of the left in the media, but I have heard many calls for labour to outline a credible alternative if they believe that the cuts are the wrong approach. Even within the party there is not consensus, with Alisdair Darling believing that cuts are required. Now that the IMF has endorsed the coalition's strategy it will become harder to convince the public that labour's alternatives are credible.

SBR, I think you make a good point about the value of the UK's credit rating. The assumption is that we have to have the AAA rating. I don't fully understand the consequences if it is withdrawn. Yes, it will become more expensive for the government to borrow, but what impact would this have on taxes and the wider economy? If the UK lost its credit rating, would cuts then be enforced because the credit supply would run out, so there would be no money for public services?

If it became more expensive for the UK to borrow we would have to raise taxes or cut pubic services to just pay the exra interest. If we tried to borrow even more to pay the interest so we could just keep spending and not raise taxes then eventually, like Greece and Ireland, the interest rate would become so high that no amount of taxes or cuts would ever balance the books. At that point the UK would default and be cut off from credit markets - unless the IMF came in to rescue us. That would involve severe austerity imposed on the UK by unelected IMF officials.

There is no escape. Once the interest rate that a country is paying exceeds its nominal rate of growth (i.e real GDP growth rate plus inflation) then debt begins to spiral ever upwards. That is where Keynsian policy always ends - it is called the Keynsian Endpoint where no more borrowing is possible to support public spending.

That is why public spending and increased taxes is essential - we either do it for ourselves or the IMF and bond markets impose it. There really is no alternative.

That's what I thought beenbeta, thanks for the clear explanation.