Austerity Backfires On UK's Conservative Party

[Star]

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Moody’s Downgrade of U.K. - Bloomberg


By Megan Greene
Feb 23, 2013


Most of the focus on Moody’s downgrade of U.K. debt to Aa1 from Aaa yesterday has been on the potential negative repercussions -- and there are some. But it also creates an enormous opportunity in the chance to ease front-loaded austerity.

The downgrade should change the government’s calculus when putting together the budget, which it will publish on March 20. Until now, the Prime Minister David Cameron and Chancellor of the Exchequer George Osborne have clung to their austerity plans in the 2012-2013 and 2013-2014 fiscal years, partly in an effort to stabilize the U.K.'s public debt burden and maintain the Aaa rating. Now that the top rating is no longer there to protect, the government might be more inclined to loosen its short-term fiscal targets.


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[EdwardBaiamonte]

Austerity Backfires On UK's Conservative Party

of course austerity cant backfire: if the government spends $100 less, the people have $100 more to spend so net spending stays the same.

Econ 101 that a liberal lacks the IQ to understand

 

[Star]

Austerity Backfires On UK's Conservative Party

of course austerity cant backfire: if the government spends $100 less, the people have $100 more to spend so net spending stays the same.

Econ 101 that a liberal lacks the IQ to understand

In order for the Government to keep those $100's coming into the peoples coffers there has to be $100's in the circular flow and-----and there has to be a marginal propensity to consume and-----and when consumers consume those $100's will multiply through the economy and-----and so on...


Economics Online: "The size of the multiplier depends upon household’s marginal decisions to spend, called the marginal propensity to consume (mpc), or to save, called the marginal propensity to save (mps). It is important to remember that when income is spent, this spending becomes someone else’s income, and so on."


I don't want to say your response is idiotic but-----but your response doesn't exist in the real world.

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[Star]

Prime Minister David Cameron and Chancellor of the Exchequer George Osborne sold their austerity to the U.K. for the express reason to keep their AAA rating. Obviously-----obviously it didn't work, removing Cameron's and Osborne's AAA 'shield' is:

This is what the U.K. needs if it is to return to robust economic growth any time soon, because there is little sign of a rescue from external demand. The same day that Moody’s downgraded the U.K., the European Commission released its forecasts for the euro area, indicating that the currency union will contract yet again this year. Around 40 percent of the U.K. exports go to the euro area, so the economy will need to rely on domestic demand for growth. This can only happen if the government stops its front-loaded austerity measures.

There is no question that this will be a big political blow for Cameron, Osborne and the Conservative Party, who largely staked their election prospects on implementing the fiscal measures required to ensure that the U.K. kept its triple-A rating. There may also be sell-offs in the bond markets as a result of the downgrade, although the news was mostly priced in long ago. Still, Cameron and Osborne respond as they should, this downgrade could be good news for the U.K. economy in the short-term.
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[Avorysuds]

Great NEWS!!!!! Spending fails!!!! All the worlds economies failed without an ounce of Austerity, in fact they were all doing massive deficit spending!!!


I love how people change blame from overspending to not spending enough... Spending alone failed every countries economy on the planet simultaneously. But no no, please, blame "austerity."

 

[Avorysuds]

Think of an economy like eating. What we all were doing was massively overeating. Then all around the same time there was a flood of massive heart attacks... The doctor says you need to change your diet. Many countries (The US being one of them) keeps the course of over eating, in fact some countries (like the US) deiced to to eat even more.

Some countries, very very few try a diet, a new diet called "austerity." This diet is based on cutting calories and eating healthy. Now there are many different ways that this new diet is followed, in some cases the diet is so vaguely followed that the reduction in calories (spending) is hardly even measurable, and in those cases the same health problems prosiest.

Now, some countries do an actual amount of calorie (spending) cutting and they feel hungry..... Ooofff...
Now, their option was to kill themselves off with more eating (spending) or feel starved by eating (spending) less... Now the addicted fatties (progressives) bitch about how watching what you eat (spend) sucks and does not work because you feel hungry as a case to make everyone go back to overeating (spending) so they don't feel chitty about being morbidly obese with an array of health problems... otherwise known as bankrupt.

 

[EdwardBaiamonte]

Austerity Backfires On UK's Conservative Party

of course austerity cant backfire: if the government spends $100 less, the people have $100 more to spend so net spending stays the same.

Econ 101 that a liberal lacks the IQ to understand

In order for the Government to keep those $100's coming into the peoples coffers there has to be $100's in the circular flow and-----and there has to be a marginal propensity to consume and-----and when consumers consume those $100's will multiply through the economy and-----and so on...


Economics Online: "The size of the multiplier depends upon household’s marginal decisions to spend, called the marginal propensity to consume (mpc), or to save, called the marginal propensity to save (mps). It is important to remember that when income is spent, this spending becomes someone else’s income, and so on."


I don't want to say your response is idiotic but-----but your response doesn't exist in the real world.

.

of course austerity cant backfire: if the government spends $100 less, the people have $100 more to spend so net spending stays the same.

Econ 101 that a liberal lacks the IQ to understand

 

[EdwardBaiamonte]

Austerity Backfires On UK's Conservative Party

of course austerity cant backfire: if the government spends $100 less, the people have $100 more to spend so net spending stays the same.

Econ 101 that a liberal lacks the IQ to understand

In order for the Government to keep those $100's coming into the peoples coffers there has to be $100's in the circular flow and-----and there has to be a marginal propensity to consume and-----and when consumers consume those $100's will multiply through the economy and-----and so on...


Economics Online: "The size of the multiplier depends upon household’s marginal decisions to spend, called the marginal propensity to consume (mpc), or to save, called the marginal propensity to save (mps). It is important to remember that when income is spent, this spending becomes someone else’s income, and so on."


I don't want to say your response is idiotic but-----but your response doesn't exist in the real world.

.

you mean if the governemnt spends $100 less the people don't have their $100 to spend???????????????????????????????????????
PLease explain or admit as a liberal you lack the IQ to do so.

 

[boedicca]

Austerity Backfires On UK's Conservative Party

of course austerity cant backfire: if the government spends $100 less, the people have $100 more to spend so net spending stays the same.

Econ 101 that a liberal lacks the IQ to understand

In order for the Government to keep those $100's coming into the peoples coffers there has to be $100's in the circular flow and-----and there has to be a marginal propensity to consume and-----and when consumers consume those $100's will multiply through the economy and-----and so on...


Economics Online: "The size of the multiplier depends upon household’s marginal decisions to spend, called the marginal propensity to consume (mpc), or to save, called the marginal propensity to save (mps). It is important to remember that when income is spent, this spending becomes someone else’s income, and so on."


I don't want to say your response is idiotic but-----but your response doesn't exist in the real world.

.

You are sorely mistaken if you believe that government spending has a positive, or even a neutral impact on an economy. Moonbats such as yourself always neglect what is Unseen. IOW, what could that capital have accomplished if the government didn't seize it in order to transfer it to a crony?

Bastiat's parable may help you understand, although I'm doubtful you'll grok it.

Have you ever witnessed the anger of the good shopkeeper, James Goodfellow, when his careless son has happened to break a pane of glass? If you have been present at such a scene, you will most assuredly bear witness to the fact that every one of the spectators, were there even thirty of them, by common consent apparently, offered the unfortunate owner this invariable consolation – "It is an ill wind that blows nobody good. Everybody must live, and what would become of the glaziers if panes of glass were never broken?"

Now, this form of condolence contains an entire theory, which it will be well to show up in this simple case, seeing that it is precisely the same as that which, unhappily, regulates the greater part of our economical institutions.

Suppose it cost six francs to repair the damage, and you say that the accident brings six francs to the glazier's trade – that it encourages that trade to the amount of six francs – I grant it; I have not a word to say against it; you reason justly. The glazier comes, performs his task, receives his six francs, rubs his hands, and, in his heart, blesses the careless child. All this is that which is seen.

But if, on the other hand, you come to the conclusion, as is too often the case, that it is a good thing to break windows, that it causes money to circulate, and that the encouragement of industry in general will be the result of it, you will oblige me to call out, "Stop there! Your theory is confined to that which is seen; it takes no account of that which is not seen."

It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way, which this accident has prevented.

http://en.wikipedia.org/wiki/Parable_of_the_broken_window

 

[EdwardBaiamonte]

You are sorely mistaken if you believe that government spending has a positive, or even a neutral impact on an economy.

This is the great liberal lie that would have made Joseph Goebballs proud. The liberals would have us believe that when government spends our money it magicially multiplies but when we spend it it does not!!

They apparently have a special fairy dust they sprinkle on the money.

 

[boedicca]

Yes - in plain English, it's called printing money.

 

[Star]

of course austerity cant backfire: if the government spends $100 less, the people have $100 more to spend so net spending stays the same.

Econ 101 that a liberal lacks the IQ to understand

In order for the Government to keep those $100's coming into the peoples coffers there has to be $100's in the circular flow and-----and there has to be a marginal propensity to consume and-----and when consumers consume those $100's will multiply through the economy and-----and so on...


Economics Online: "The size of the multiplier depends upon household’s marginal decisions to spend, called the marginal propensity to consume (mpc), or to save, called the marginal propensity to save (mps). It is important to remember that when income is spent, this spending becomes someone else’s income, and so on."


I don't want to say your response is idiotic but-----but your response doesn't exist in the real world.

.

You are sorely mistaken if you believe that government spending has a positive, or even a neutral impact on an economy. Moonbats such as yourself always neglect what is Unseen. IOW, what could that capital have accomplished if the government didn't seize it in order to transfer it to a crony?

Bastiat's parable may help you understand, although I'm doubtful you'll grok it.

Have you ever witnessed the anger of the good shopkeeper, James Goodfellow, when his careless son has happened to break a pane of glass? If you have been present at such a scene, you will most assuredly bear witness to the fact that every one of the spectators, were there even thirty of them, by common consent apparently, offered the unfortunate owner this invariable consolation – "It is an ill wind that blows nobody good. Everybody must live, and what would become of the glaziers if panes of glass were never broken?"

Now, this form of condolence contains an entire theory, which it will be well to show up in this simple case, seeing that it is precisely the same as that which, unhappily, regulates the greater part of our economical institutions.

Suppose it cost six francs to repair the damage, and you say that the accident brings six francs to the glazier's trade – that it encourages that trade to the amount of six francs – I grant it; I have not a word to say against it; you reason justly. The glazier comes, performs his task, receives his six francs, rubs his hands, and, in his heart, blesses the careless child. All this is that which is seen.

But if, on the other hand, you come to the conclusion, as is too often the case, that it is a good thing to break windows, that it causes money to circulate, and that the encouragement of industry in general will be the result of it, you will oblige me to call out, "Stop there! Your theory is confined to that which is seen; it takes no account of that which is not seen."

It is not seen that as our shopkeeper has spent six francs upon one thing, he cannot spend them upon another. It is not seen that if he had not had a window to replace, he would, perhaps, have replaced his old shoes, or added another book to his library. In short, he would have employed his six francs in some way, which this accident has prevented.

http://en.wikipedia.org/wiki/Parable_of_the_broken_window

Ayn Rand/Frédéric Bastiat/Bastiat/Rand/Rand/Bastiat -pewsh!-

Grok this -

Frédéric Bastiat and Ayn Rand agree

December 10, 2012
By admin

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[EdwardBaiamonte]

In order for the Government to keep those $100's coming into the peoples coffers

a liberal will be so slow as to not know that money flows from the people's coffers to the government, not the other way around.