Right I get it, the nation is in debt and we need to claw the money back but really

[NearlyMrsCustardsHardHat]

Do they need to keep hitting us as individuals and families? Why on earth are they not hitting businesses and corporations and taxing them properly? They won't ALL go abroad if taxes rise will they? Surely there's always some business to be done in the UK even if they did?

I don't as a general rule object to being taxed because there is a need for it but I am getting increasingly angry with Labour for their reckless spending and increasingly angry with the Con-Dems for their ruthless unfair clawing back of funds.

Julia, I'm off to look at the coalition for resistance. I like Tony Ben

Fine, whatever Mini. Given I quoted from your previous post, that would be a small suggestion that I read your posts, even if I disagree. But by all means, you don't need to engage me at all. Lefties rarely engage with those with an opposing point of view because their position only works in theory and never in practice.

Julia, I've looked at the PCS link. The first graph showing the debt as a percentage of GDP has no dates or sources on it at all. A quick google and I find these two:

2008 and 2010

Both seem vastly different to the one quoted in the PCS article and both have dates and the sources the author used. Both show the UK is way behind France & Germany.

Public spending is an investment To a point that is certainly correct. But there does come a point where putting more money into public services becomes inefficient. And our current public sector is too large compared to our private sector.

The deficit is due to the recession Nope. We've always had a deficit, well practically always. The recession just magnified it. A more true statement would be "The deficit was increased due to the recession" And when we borrow money, we have to pay it back. Economic flatearthers will deny this but anyone with an ounce of common sense will understand that. The only question is when.

"Just to be clear: Osborne expects that households will increase their borrowing to spend money, just so the economy can limp on at a slow rate"

Osborne believed that capital investment from the private sector would increase 10% 2012. In 2011 it feel by 2%. Businesses are not investing and employing at the rate we need to stimulate the economy and there is no uptake in consumer demand. So Osborne is now relying on people to spend.

How can we stop borrowing when we are being relied upon to spend to drive growth in the economy. (if employers don't employ or don't agree to pay higher wages)

There are two simple steps that could cut government borrowing and stimulate demand in the private sector.

Capital investment into jobs, the private sector must employ and produce, even where there seems to be little demand, it will stimulate demand.

Government must focus attention on it's social responsibility by cutting tax credits and other in work benefits which subsidise business and they must compel the private sector to pay decent wages.

At the moment we are socialising risk and privatising profit. The state is not too large in relation to private business, it is too expensive in relation to the social benefits that business provide. Cost of maintaining the state is too high because business pay too little in tax, people pay too little in tax (low wages) and because of lower living standards and high unemployment the deficit will increase, the economy will stall and the wealthy are not investing in areas that grow the economy, rather they invest only in assets that have no direct impact in the real economy.

And how does the UK government....any UK government compel private businesses to pay higher wages? Raise the minimum wage again? What to? The mythical "living wage"?

Someone will now say "Ah well....Germany manages it". Well yes....they have a fantastically strong manufacturing industry, backed by a first class education system and a government which believes in prudence.

We have no strong manufacturing industry, our education is pretty damn shoddy and a budget deficit which makes a grown man weep. And somehow you expect the government to wave some sort of magic wand and make wages higher? Really?

If you have the answer I suggest you tell No 10 right away and I'm sure they'd get rid of gideon in a heartbeat for a costed, alternative proposal which doesnt cause pain to those most needy or cripple the economy.

Sorry I was terse earlier

We are the third largest economy behind Germany and France. Germany & France have something in common, they both have strong unions. We have relied too heavily on the finance sector.
(historically the first nation to have a national bank, one ex) our debt is to this institution and it controls the issue of money which it charges interest on. We are indebted to the very same people we bailed out, so why did we bail them out?

The German economy is strong on manufacturing and they have local agreements/laws with factories that penalise them if they off-shore or move their manufacturing else where, even within Germany. This would take years to institute similar here, plus we don't have a strong manufacturing sector but we did once.

We need to examine ways in which we can create loyalty and just as with Germany it doesn't have to be done through low corporate taxation or low wages. In 2012 the effective corporate tax rate, including trade tax and solidarity tax is about 30%-33% in Germany.

If we insist upon attracting businesses to stay here, come here or set up just through the supply of low waged labour and low taxes we might compete with china on their terms but bear in mind, this low waged labour will not have buying power and we can't export to regions who similarly have lower living standards.

Susan George states that America no longer manufactures and exports, mainly because the Fed, IMF and world banks prevent nations from paying down debt, prospering and increasing living standards. This leaves the USA and indeed us, with few options for increasing exports.

I completely agree that we relied (and continue to rely) too much on the finance sector. Unfortunately right now it is a necessary evil which the powers that be didn't forsee.

But to change the basis of our economy will take years. It's not a quick fix. I've said before we need to invest heavily in high tech manufacturing and those companies will take years, even decades to grow into powerhouses. So from that point of view we must take a long term view. And in my opinion, raising taxes now puts off investment.

If we HAD a brilliant manufacturing sector which counter balanced our financial sector and we were doing fantastic in the world economies then yes....we could get away with raising corporation tax. But if we were doing that well, we wouldn't need to would we? Our coffers would be overrunning.

Funnily enough I am from Hong Kong where the government have been the model of frugal public spending for decades. They have one of the lowest tax regimes in the world, no VAT and a incredibly basic welfare system by our standards. Do you know what problem they had recently? They had too much money. Yes that's right, too much. So their solution? Every citizen gets £500 back.

My point is that much can be done with a low tax regime too. We just need a sensible government whom spends only what we can afford and not make us think they can perform miracles like increase public spending without raising taxes.

I agree, we can not increase public spending mainly because to do so will result in borrowing from the world banks who are the root cause of the problem I agree, it will take years to build up high tech manufacturing. We are good on design and management but weak on the ground in terms of manufacturing capability. This is driven in part also by the world banks, we need massive capital/private investment into the means of production, this won't happen because we don't own or control investment either as a government or as a people, the means of production.

When investors seek to increase profit and have no national loyalty (the shareholders) they will seek out areas of high skill and low wages. ie china and India. What no one is prepared to tackle is the fact that capital chases over the globe, shows no loyalty and no social conscience.

We allow the world banks to print money, not based on the gold held but through a system which allows them to conjure up mickey mouse money, print it and then charge interest. It is this interest that makes uber wealthy investors very rich and governments afraid. Tax is rising and governments are finding ways of raising taxes that are less transparent, not to pay for their social responsibilities but to meet interest payment.

Governments are not in control of the situation and they need to fess up. We need fundamental change, why do governments not try to reform the banking system? Why are we indebted, not by how much........ but why?

Excellent film here, history of money and the World banks & explains George's inability to manage our economy.