To think some posters need a "reality check" re. views on benefit changes

[lesley33]

I have some concerns about some of the proposed changes to benefits and how these may adversely affect people. So this is NOT a thread about that. But I am getting increasingly fed up at some of the frankly ridiculous reasons some posters are giving against the proposed changes. Examples include:

1. That children 12 and over will be traumatised if both parents work - even if second parent only works 20 hours a week.

1. That a parent with children 12 and over shouldn't have to commute up to 90 minutes each way to work. Far from ideal I know and if someone is on low wages this might not be affordable. But perfectly doable.

1. That childcare is impossible to get for teenagers. Ignoring the fact that many parents, myself included use a combination of kids home alone and afterschool activities.

AIBU to think some people need a reality check? Plenty of people with children already work, many with both parents working full time by the time their kids are teenagers. Plenty of people have long commutes, struggle with childcare, etc. Things might not be "ideal", but these are things that many many working parents already do.

we cannot run the same debt ratio as america. the dollar can functions at a higher debt ratio than any other currency because it is the global currency.

also they are much less affected by the euro crisis because they are not so dependant on europe.

Europe

Anyone want to hazard a guess how that's going to end?

part structured default, part QE, is my guess

maths sorry also www.bloomberg.com/markets/rates-bonds/government-bonds/us/ if you flip between the tabs for UK & US you can see how much cheaper US borrowing is

alouisee it will be shit for all of us for a few years but we will get thought it, hopefully with a better, stronger economy & a welfare system to help people who need it.

Where the GDP:national debt ratio stands depends on what debts are included in the calculations. Bailouts to banks and/or public sector pension liability, for instance, are not included in every index.

More on the US economy, from 2011:
'If anything, the factors that restrained growth near the end of 2011 are expected to exert a bigger drag on the economy this year: Cuts in military and other federal spending. A slower pace of company restocking. Weak or flat pay increases. Sluggish growth in consumer spending.'

Indications are that the US economy grew at about a rate of 2.8% in 2011.

All pointing to the idea that government spending can be an engine of growth. Another assumption in that article is that unemployment is bad because it dampens consumer spending, a factor that accounts for 70% of American economic activity. If unemployment is bad for this reason (that economic activity depends heavily on demand and not because it is immoral to be unemployed and in receipt of welfare) then cutting the amount welfare recipients have available to spend is also not a good idea, unless there are employment opportunities available for the unemployed (maybe employment opportunities in the building sector when a huge public housing project gets under way?) and decent wages to boot.

Another assumption is that growth has to be the primary method of climbing out of recession. It can't be done simply by reducing government debt and cutting spending. The ratio can remain the same or even get worse if the economy slows no matter how much spending is cut, and cutting spending has a dampening effect on demand therefore on growth. Growth has to be the driver of recovery.

maths so i find a new story with a different opinion:

articles.businessinsider.com/2011-08-08/markets/30010404_1_stimulus-package-spending-cuts-debt
www.forbes.com/sites/steveschaefer/2012/01/27/u-s-economy-slow-but-growing-q4-gdp-up-2-8/

i dont think either of us quoting journalists with different opinions shows anything other than... different opinions.

i not think you can the compare two very different economies anyway.

if we spent the same money, it would cost more, & cost us our rating, so any refinancing of existing debt would also cost more.

European demand has a large impact on the US economic outlook. If Europe and the Eurozone sink then US exports will too. Oil prices and the European outlook are major factors affecting US prospects for growth.

Japanese paradox -- Japan functions at a debt ratio that is mind boggling, and the FT thinks that the way forward is more of what it has done to deal with a crisis period, i.e. more debt.
Japanese GDP to debt ratio is about 194%, and the removal of AAA rating makes no difference to the popularity of Japanese debt with foreign investors.

'Our version of capitalism (on a macro level) is based on credit and ever expanding growth. The model is that growth in the economy combined with inflation will outstrip the interest rates on government borrowing.' True Sinica.

The moralising about keeping your house in order, etc., doesn't really have any place in today's crisis.

The basic idea that government cuts mean the economy will contract unless there is massive growth remains true no matter what economy you look at.

If spending cuts result in lower growth then tax revenues from all sources will also end up falling, and expenditure on unemployment/welfare will increase. A budget deficit is not the only element of the economy, anywhere, that will affect prospects. It affects borrowing costs, but without growth borrowing costs are going to be affected anyway.

If this is to be a long term reshaping of how government money is spent it might be smarter to try to accomplish it at a time when the economy is not so bleak, when people are not so desperate and fearful, and when debate can be measured and not reduced to images of falling into an abyss, etc. If cuts are supposed to be a means of climbing out of the current crisis, then I do think the government needs to think again.

UK exports to eurozone - over 50%
US exports to eurozone - 21%

www.ey.com/Publication/vwLUAssets/ITEM_Club_special_report_02_2011_-_Exports/$FILE/EY_ITEM_Exports_Feb_2011.pdf chart on page 3

www.ustr.gov/countries-regions/europe-middle-east/europe/european-union "U.S. exports to the EU accounted for 21 percent of overall U.S. exports in 2008. "

so again i dont think the two economies compare.

UK exports to eurozone - over 50% of total UK export
US exports to eurozone - 21% of total US export

The moralising about keeping your house in order, etc., doesn't really have any place in today's crisis.

i dont see it as moralising - i see it as not making a bad situation worse.

SinecalSanta 100% agree your comments on capitalism

If you think anyone's economy could absorb the hit that a 20% reduction in exports would represent and keep on rolling then I think you are mistaken. Just because the numbers do not match exactly does not mean there would be a negligible impact. The prospect of European recovery or recession is a major factor in US economic outlook as it directly affects the trend in employment.

A bad situation would be made infinitely worse if government spending was cut too drastically, because growth would be affected. If you agree with Sinica's comments on capitalism then you really have to agree with the idea that growth is essential, and understand that contraction that would follow drastic cuts would be making a bad situation worse. 'Our version of capitalism (on a macro level) is based on credit and ever expanding growth. The model is that growth in the economy combined with inflation will outstrip the interest rates on government borrowing' - posted by Sinica. A fall in government spending accompanied by a very predictable fall in growth will not put the house in order. The ratio will remain the same even if the numbers are lower. The whole idea is to keep the wheels of the economy at least spinning if not accelerating.

maths if you think over 50% and 21% are similar, i need to just agree to disagree with you on this topic. And i cannot imagine anyone else thinks this debate is intersting.

Sinical's comments i was interested in: Our present model of capitalism isn't the one envisaged by Smith though, with roughly equal craftsmen and farmers selling surpluses and buying what they couldn't produce

'fair pricing' required and infinite number of sellers and an infinite number of buyers. what have have for food and banking, pretty vital:

a small number of sellers (tesco, sainburys etc...... HSBC, Lloyds). large numbers of buys us. they win.

typos: a small number of sellers (tesco, sainburys etc...... HSBC, Lloyds). large numbers of buyers, us. they win

large number of farmers supplying tesco et al. the supermarkets win.

how did we let this happen?

Hello. We're going to move this thread to Politics now - we think that's where it rightly belongs.

Or because Pag told you to?

I don't see how turning the clock back to the 18th C would be helpful, pleasant and all though nostalgia may be. Moving forward involves dealing with reality.

Here is what Timothy Geithner, US Treasury Secretary, had to say about the US economy and the European economy:
'The rate of growth depended on two fundamental factors, he said - what happens in Europe and the Gulf, which determines the oil price, and "whether Republicans in Congress decide they want to legislate things that are good for growth in the short term".' From www.bbc.co.uk/news/business-16760575

Obviously he has a party line to follow wrt the Republicans, but I don't think a Treasury Secretary appointed by a Republican president would argue with his take on Europe or on oil prices as huge factors that affect the US economy.

HQ I assume you are going to move all the 'tories are twats' threads too? Hmmm.

What with you being representative of all political views and not over run by noth london middle class SAHMs.

All the shooting and disembowelling threads could all be moved to...to...to...

The Wild West section!

I live in South London
I work full time from home
HTH

I live in east london
Work part time
Wouldnt tick a single Middle Class box. Wouldnt want to.

HTH too

Ah then, since we are such a broad and catholic church, we can expect consistency from HQ then.

Am middle class and not ashamed of it!

I'm from Essex, it's completely classless, you're either heavily in debt extremely rich or heavily in debt to the wrong people extremely poor.

You can't distinguish us though, we're all orange with very long fingernails.

I'm proud of being middle class
My working class parents worked very, very hard to make me so

I probably tick a lot of middle class boxes

including posting on Mumsnet

Yes and I am proud of being working class!
Nothing wrong with be middle class but I am not and I dont have any urge to be.
If thats ok