So what happens when the deficit is paid off?

[SpawnChorus]

Do you think any of the cuts (e.g. Child Benefit) will be reversed when the economy's out of crisis?

no - its idealogical
although, the timeframe brings us directly to the next gen election so they'll probably throw some sort of sweetner our way in the hope that we'll forget the utter destruction to our society that they will bring about.
when labour next get in, they will probably work to redress the issues but then will be accused of being a spending party again - same old cycle, same old nasty tories

We all go on vaycay and get free ice-cream ALL day long.

Doubt it. The welfare system needs to be reformed anyway, and an economic crisis is the perfect reason to do so. Same with a lot of the other cuts, particularly to the size of the public sector, as generaly those on the righty-wing HATE big government, so this is an excuse to take a giant ax to it. However, if the next government is lefty-wing, chances are they'll build it back up again and find a good excuse to do it.

I do hope CB gets reversed, can't say I'm overly bothered aboput things like the 26k cap etc. Hopefully it means more money for schools etc., I fear though this have given the tories a bad name and whoever gets in after will be wonderful and spend more, but only because of what the tories are doing now

The Labour party reversed very little that the previous administration achieved.... no renationalisation of industry, no increase in income tax, no repeal of the legislation on strike ballots. This despite having fought it tooth and nail at the time.

There will be room to give something back to the electorate one the economy gets in safer waters but it's going to be a long process. A Conservative/coalition government would traditionally give more back in the form of tax allowances than in benefits.

I seriously CANNOT imagine the Tories (or Lib Dems) being voted in again in the next election.

Someone once said that a week is a long time in politics. Five years is an eternity. A lot can change in that time which is why we're getting all the painful stuff first.

Yeah, but...but...they're such DICKS

Nothing ever gets changed back.

The current administration may well be 'dicks' but have you seen the alternative? Not a clue between them over there in Ed's sixth-form common room. All very quick to say 'that's not what we would have done' but not a dickiebird about what they would have done instead.

At least politics is interesting again. :)

"I seriously CANNOT imagine the Tories (or Lib Dems) being voted in again in the next election."

Yes, incoming Tory governments that engage in a programme of cutbacks and preside over a high level of unemployment tend to lose the following election. That's why Labour won their landslide victory in 1983.

It depends who is in power then and what their priorities are.

No. Once we have a surplus we will still have massive debt; we should pay off as much of the debt as we can.

Any money that can be spent should be spent on capital projects like transport and on tax cuts to improve our competitiveness.

No. But isn't it right that the deficit is the difference between what's coming in, in hte form of taxes etc, and what's going out, eg defence, education, benefits, debt repayments etc and right now that gap is huge. it' not about 'repaying' anything. We also have a pretty huge debt, but it's hard to repay that until the deficit is reduced. I think that's how it goes.

@ColdComfortFarm... you've got it right. The deficit is our ongoing overdraft, if you like. At the moment it's increasing the National Debt by some £180bn a year... we're spending £180bn more than we're getting in. It's too big a proportion of GDP to expect a natural upturn in the economy to deal with it. Hence spending cuts, tax rises and whatever else.

If we get the budget balanced then we still have a whopping great National Debt but at least it's not going up so fast.

Have been reading a history of the 70s lately, fascinating stuff, and much of it seemed very, very familiar right now. ('Worst economic crisis since the war' / 'We have to share the pain' / etc)

Interesting point which I had forgotten from the late 70s crisis when the IMF was called in, massive cuts had to be agreed on etc. Crisis was based on Treasury estimates for the PSBR. When the true figures came through, the actual PSBR was less than half the estimate, and indeed very little of the IMF loan was actually called in.

The author interviewed various treasury civil service bods from the time - and got a very telling quote, saying, essentially, that there is only an opportunity once every 10-20 years for the Treasury to really slam down on spending, so whenever they see the chance, they make the most of it.

IMO the whole scenario fits very closely with the current situation - and again, the opportunity for a one-off reining in of public spending is clearly being taken.

Regarding the OP - 'what happens when the deficit is paid off' - do you know the John Donne poem, can't remember his dates exactly, but maybe 1650s?

'As Princes do in times of action get
New taxes and remit them not in peace . . .'

I guess not much changes

Takver - ha!

'what happens when the deficit is paid off'

big party round mine.
Who's with me?

Wooooo! That's the kind of answer I was after Pag

Thank FREAKING goodness they're not reducing the deficit/debt like in the olden days. e.g. France (numerous times), England (1290) and Spain (1492) - expelling the Jewish population and taking all their property and money to spaff away on wars or funding exploration (it's no coincidence that Columbus sailed in 1492). Or, just inventing random taxes (windows, beards - actually, that was a religious discrimination-y type tax under the Russian tsars).

There is a very interesting (if you're boring and geeky, comme moi) book about economic crises called "this time is different" which looks at 8 centuries of economic crises. Interesting reading. Especially since the same things happen, over and over again (each time, with the government's going "this time is different! We're much cleverer/have a better understanding of economics/have ended the boom-bust cycle).

Oh lordy - am frightened by how many do not understand the difference between debt & deficit (opposition front bench included!).

I think a beard tax is a fantastic idea! Could we also have an exposed beer gut tax, a celtic band tattoo tax, an Ugg boot tax (though they are damn cosy) and a tax on slogan t-shirts that say 'I'm a little madam'? Please?

ColdComfort - I like your thinking

I propose

• g string hanging out tax
• spitting in street tax/fine of £1mn (I hate spitting in the street) and
• stupid commuters who refuse to move inside the carriage tax (though I don't know how'll that work).

I propose a Boden tax.

Middle class owners of dull souless clothes need to share the pain. In the interest of fairness, you understand.

Agree 'This Time is Different' well worth reading - should be compulsory reading for all (or is that too authoritarian?).

Fair point, AlpinePony - but perhaps poor wording rather than misunderstanding. Suspect few people actually wish to pay off the National debt in its entirety, but may still wish to understand what happens when the deficit back under control (at which point, if we are looking at historical trends and the 70s/80s we can probably solve our transport problems by hitching a lift on flying pigs as they travel past).