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Mr Osborne should have also been candid enough to add that the opposition did not notice debt building up and, while wallowing in comfort-zone politics, were even subscribing to the governments projections on growth. Yet, this problem was clear for all to see. I well remember how myself and others were expressing our concerns about the build up of personal and private debt in the webcameron forums well over eighteen months ago.

The Conservative front bench team must take some brickbats for not being vocal about a debt timebomb that stealthy ticked away while all the discussion was about sharing the proceeds of growth.

Osborne was also pretty scathing about the dubious character the Government has chosen to look after billions of our money - the head of UK Financial Investments, Glen Moreno. Seems Moreno has strong links to a bank in Leichtenstein that is up to its neck in tax dogding and money laundering.

Brown rails against tax avoidance - and then appoints Moreno: is the PM a dunce or a hypocrit?

Sorry, my mistake: the PM is NOT a hypocrit.

He's a hypocrite.

He's certainly more open and straightforward then Darling , who's interview followed a while later. Eyebrows also indicated the budget date would be later rather than sooner. Something to hide chancellor?

dear editor, i was reading that mail article about sarkozy supporting blair for the EU president. maybe someone should look at how such an outcome would affect britains relationship with the eu, especially if the tories win the next election. might make for an interesting discussion.

I thought George Osborne came across very well, he put his case clearly and succinctly, so that anybody could understand. And he neither gabbled not talked down to his possible audience.

I say 'possible', because it is evident that even people that you would think might have a clearer knowledge than yourself, regarding the significance of WHO exactly owns the appropriated banks - don't! That became evident slightly earlier in Mr. Marr's programme, when the guests were discussing the current banking situation and the apparent stasis at the moment, up pipes Ms. Trenerman, of The Times and says, 'But WE own the bank/s', I can't remember whether she added 'so we should do something about it', but that was the implication! Unfortunately she didn't hear my reply to her, which was 'noooo, we may have put the money into the transaction, as taxpayers, but it is Mr. Brown who effectively owns them in terms of decisions as to what to do!!! And we all know - to our cost - how effective Mr. Brown is at 'taking action', making decisions - in fact DOING anything, apart from issuing sound-bites to the newspapers.

George - no more clap-trap about 'putting a price on carbon' please.

"Mr Osborne should have also been candid enough to add that the opposition did not notice debt building up and, while wallowing in comfort-zone politics, were even subscribing to the governments projections on growth."

You are quite right, Tony Makara, the Conservative Party were fast asleep on the job. As you write, their only economic “policy” involved “sharing the proceeds of growth.”

Cameron’s agenda seems to have been limited to being seen as “nice” and, even now, there has been no real will to tell the British people that we have been living well beyond our means for nearly a decade and the party is over, not for the semi-nationalised banks but also for the bloated public sector and those who thought they could live on credit, buying luxuries they did not need with money they had not earned.

Her Majesty’s Opposition has a vital part to play in our constitution, both to seek out and draw attention to flaws in the government policy and to be ready to take over as the alternative government. The Tory Party has yet to demonstrate that it is fit for government.

I think we're making a rod for our own backs by backing the bailouts and increased public spending whilst attacking them at the same time. The anti-Mandy ad will come back to bite us as we should be in favour of free trade and it makes us look opportunistic.

Clarity and simplicity of message is needed.

- The bailout has failed, so let's not throw more good money after bad.

- We've been living beyond our means for too long. Now we need to cut our cloth accordingly. This means spending cuts.

- Taxes are too high and take money out of strained family budgets. Taxes need to come down.

- Bosses of nationalised failed banks should not be getting bonuses. If they refuse to give their perks up, their banks should be abandoned to administration.

- Corporate greed and government greed are equally damaging. Government needs to set an example by cutting the pay and perks of MPs and senior civil servants.

We will only earn respect for our policies if we are honest with the British people and tell it like it is. There's no way of sugar-coating the fact that we are in a real mess.

"You are quite right, Tony Makara, the Conservative Party were fast asleep on the job. As you write, their only economic “policy” involved “sharing the proceeds of growth.” "

That's not 100% true, some Conservative commentators had been warning for some time that the Housing Bubble was going to burst.
This Old Bishop included. Sadly it tended to be fringe voices, and so was easily dismissed. There is a lesson here.

"The party is over for the banks... you can't go on paying yourself 20 times what a heart surgeon gets"

That really does put the problem in perspective and will have gone down well with the public.

" On so-called "moral capitalism", he said that whilst markets are "far better than other systems" when it comes to distributing resources and rewards, they are "a means to and ends" and not the "be-all and end-all" as government needs to address the unfairness created by markets."

In fact the Markets have been very bad at distributing rewards over the last 20-30yrs.Whilst productivity has increased by up to 80% in real terms, wages have stagnated for the vast majority of people in the western world. The exceptions seem to have been at board room and very senior management level, who have seen their rewards increase significantly.

"The Bank of England made mistakes over the last decade - not spotting the levels of debt building up in the economy, the asset boom, housing inflation"

Again this is not 100% true. There were people, sometimes very senior people at the Bank Of England, who were pointing out that the levels of debt and housing inflation was out of control, but they were ignored. Instead we had irresponsible BBC television programs encouraging their viewers to buy properties, give them a lick of paint, and sell them on for a vast profit.

"He wouldn't rule out printing money quantitative easing"

Neither should he have. It's the best way to counter deflation, but should be approached with extreme caution.

All in all a fairly sensible interview that will have appealed to middle England.
Of course there will be those who will criticize G.O. for not making any policy announcements, but as we have seen to often, Labour would only implement them badly, in an attempt to steal his thunder.

Bishop Swine you make too many excuses for the fact that until very recently the Tory party's economic policy has been 'populist' and 'behind the curve' lacking any intellectual analysis or leadership. It is only now that we starting to see some glimpses of common sense prevailing - e.g. we cannot borrow our way out of this recession, sadly the pain has to be taken and the quicker we get through it the quicker we can recover. Quantative easing is political expediency, debases the monetary system, penalises those who have been prudent and bails out the profligate. Sadly, the most logical and appropiate policy is to dramatically cut government expenditure is something that no political party will advocate i.e. to live within our means, so by definition it is the right way forward, particulary as the economic community would be against it(again so few of these 'supposed expert's predicted the risk and dangers that we faced a few years ago!) Tough times need tough decisions with people needing to be told they have lived beyond their means for the last 5 years plus and now it is sadly payback time. Sometimes people will react positively when confronted with the truth that the this last 8 years has been a period of 'fallacious' growth under this Labour administration. Finally, they may now see the reality of the 'Emperor's new clothes' re the banishment of boom and bust!

"Bishop Swine you make too many excuses for the fact that until very recently the Tory party's economic policy has been 'populist' and 'behind the curve' lacking any intellectual analysis or leadership"

Do I? I thought I tried to be positive about G.O. in the hope that he will yet rise to the occasion. In Fact I have been quite critical of the leadership when it has been appropriate and I did indeed back Ken Clarke's return to the shed cabinet, because I hope he will bring some of his experience and wisdom to the table.I do agree that we have been behind the curve, and have appeared wrong footed. Let's hope that the message gets through and we are rewarded shortly with some clear blue-water policies, and something more substantial to sell on the doorsteps. I do believe that we are in danger of talking ourselves, and the nation into an even deeper hole, and so must be careful about how bad we tell the public the situation really is. That we need to quickly respond to a worsening situation with sane answers is clear. However, the problems are complex, and the medicine will be very unplesant. Can you blame George for being warm and wholly under the circumstances. There is an tendany to kill the messager! Being popular has great importance if we hope to win.

Reading the blurb above, looks like a repeat performance. Nothing new, no fuirther analysis building upon previous statements. All rather obvious keeping the boat stable stuff. Not very exciting though, nor particularly illuminating either since Tory policy is so often defined by what it declares it will not be, rather than what it will...

Im nowhere near being an economist so quantitative easing for me is just a phrase.

And next Sunday morning??
Look forward to more dross.
The Vat cut was limited by EU diktat. Neither you nor Cameron will be permitted to to cut the rate below 15%.
Bonuses - unacceptable, were they morally acceptable pre nationalisation?
Printing money is a sensible monetary policy? I assure you that calling it "quantative easing" will not desguise the fact that this is fiscal suicide.
The bank of England made mistakes over the last decade and you were doing, what?
Capitalism is a means to an end and not the be-all and end-all. Are you really a Marxist in Tory clothing?

We are still waiting to hear what a Conservative government is going to do to sort this economy out, May 2010 isn't that far away, and none of us can see the Labour government improving things between now and then. So Messrs Osborne and Cameron need to have a plan in place, one they can present before the British people.

All We've heard so far are promises to manage affairs more soberly, but that will not be enough to put people back to work, to reduce the burden of taxation, to dismantle the huge public sector etc.

The entire economy has to be transformed with less emphasis on the small employers, the SMEs, services etc, in favour of hard industries, the people who can manufacture and produce large numbers of jobs. This can only be done by government making it profitable to produce in Britain, and a special-tax-status being awarded to manufacturers.

We need a plan, a willingness to recognize that the old economy is dead, and that it must be replaced with a new creative and productive model with manufacturing as the backbone of the economy.

I'm nowhere near being an economist so quantitative easing for me is just a phrase.

James - I hope this helps?!

The monetary and fiscal explosion -
Central banks are now using all means at their disposal to avert a deflationary debt spiral reminiscent of the 1930s by driving short interest rates close to zero. As they approach this level their efficacy wanes, rather like a junkie where increasing the dose has less and less of an incremental effect, so central banks are now beginning to target the supply of money, clumsily known as ‘quantitative easing’. In practice this is the biggest asset swap in history; central banks expand their balance sheets by taking on increasingly ‘dubious collateral’ to compensate for the rapid deceleration of credit availability to the private sector.

The party`s economic policy is just face both ways on everything, don`t commit on anything and hope people will go along with it beceause there fed up with Labour.
If the leadership thinks that come election time this will work they are in for a shock. People will not vote for change just on trust.

I do believe we were too slow to question Brown's economy, and I believe we have been to eager to buy into and accept some of the governments actions of late. I also believe that the consequencies of government policy in the last 3 months will be high inflation in 2 to 3 years, causing longer term higher interest rates, and all the pain associated with curing once again Labours inflation.
Bit then again I have been saying this for 16 months or more - see post below

We, as an opposition should be calculating the true scale of national debt in this country, and then looking again at his golden rules on borrowing, and his record on public finances in general.

After 12 years of growth, generated by Conservative policies of supply side reforms and painful economic medicine, that brought reality to British business and the economy, the golden legacy inherited by Brown has been wasted, and at a time when we should be in great surplus repaying debt, we are massively adding to it.

This country has a serious problem looming on public debt, and when reality bites, the government of the day will take the blame for Gordon's folly. That could well be the next Conservative government - and so we had better start challenging Brown's economic record now, and sew into the minds of the electorate where the blame really lies.

Attack, attack. attack - his economic record in the long run will be slated by economic historians.

Posted by: Andrew Langley | November 02, 2007 at 11:58 PM

Thanks robert. It helps a bit. Im only really understanding part of it though. Obviously money is going into the supply, but how is it created and how does the money actually get through to the people who would be spending it?


Basically the government print new notes and buy things with them.

Unfortunately this government is not competent to properly price anything, so they will pay far too much for far too little, inflation will go through the roof, and companies in the private sector will suffer as the state compete with them using their own money against them...

What is probably worse is that brown fundamentally misunderstand wealth creation.

Building (say) sea defences, or roads *creates* an asset that did not exist before, and the money paid for it is 'new' wealth for the people who did the work.

However buying shares or other financial assets (i.e. propping up banks) does not create anything, (except maybe profits for the banks, when the government gets its sums wrong again) - it just changes the ownership of existing 'assets'.

My site for the month is www.zopa.com - lending/borrowing without involving the failed banking orgnisations, at no cost to the taxpayer.

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