The black hole is the lie to justify the diminishing returns of wealth redistribution, envy and taxing aspiration/success. The public services need reform, throwing endless money without will just lead to more waste.
It’s good to know there are so many financial experts out there offering advice to the new Labour chancellor but remained silent for the 14 year when the economy was being trashed under the Tories. High inflation and crippling interest rates didn’t happen overnight and the inherited black hole would have to be filled no matter which party gained power.
I'm currently just into the 40% tax band, if the limit doesn't raise in april and I get a pay rise I'll be taking advantage of flexible working and going down to 4 days per week because it's simply not worth it to me to work that extra day.
I am one of the fortunate generation born in the early 1950s. I have two final salary pensions (career change in 40s), a state pension and more savings than I ever had in my working life. It is time for those of my generation to contribute more, if we're financially able to do so (that's the important caveat). I could pay an extra £100 per month or so in taxes, and would still be able to lead a very comfortable existence. It is time for us of the boomer generation who are doing well financially, to put a little bit more into the pot. A contribution towards the extra we consume in NHS treatment or future care perhaps. Unpalatable yes, but if there simply isn't enough in the national kitty to pay for adequate services, then the money will need to come from somewhere. If my partner and I can afford to spend thousands on cruises, then we can put a bit more into the pot to help those less fortunate than ourselves.
We are very poorly served by the politicians running this country. The standards shown by our parliamentarians is shockingly low. In the private sector the amount of incompetence shown by both Conservatives and Labour would have resulted in the sack. The Houses of Parliament needs refurbishment in to a modern arena that can cater for the number of MPs on the floor. The method of debate is not fit for purpose and is archaic. Should the chamber be required to stay true to its historical state because of the building's listed status then a new fit-for-purpose building should be erected in the midlands with the Houses of Parliament turned into a museum. The way the country's financials are debated is a complete farce with little visibility granted of the numbers banded about. How on earth the OBR, IFS and Labour party did not know about the £22bn is beyond a joke. How Labour could mention them without detail is amazing. The low point came during the Brexit negotiations when Michel Barnier turned up with a stack of papers and our lot turned up without even a BIC Biro or some A4 to write on. Everything here needs fixing, lets start at HQ.
Adding inheritance tax on agricultural business would make it impossible for most children to take over their parents farm. That would cause increase in food prices and even food shortage. Very shortsighted.
@@guystrong7218 you are correct and those who buy that land could end up putting solar farms on it or turbines and take that land out of food production and as the comment above says lead to food shortages and higher prices and screw farms and farmers over who know how to look after that land
So basically lies and dodgy projections from government. No one wants to talk about dept and physical responsibility. How can they talk of 22 billion black hole and in the next breath talk about spending 22 billion on carbon capture technology? People have been casually stating that “taxes have to rise” but if the government is not being seen to spend wisely and save where they can, this house of cards will come crashing down. I thought Ben made some cracking points.
Andrew Marr has really been taken in by Labour's narrative. He's an intelligent man and it's about time he questioned his own incredible bias towards Labour.
Though it is quite useful to have someone making these reasoned arguments in defence of Labour. Because most journalists are currently being very tough on the government. (As of course they should be.)
How can there still be no public discussion of money creation? Ten years ago at least a few MPs were interested in the subject and the possibility that the current system doesn't work. Money created mostly via commercial bank lending, i.e. with interest attached... a school of thought claims it's mathmetically unsustainable, but the monetary system is so complex, so many interlinked vehicles, no-one has a empirical grasp of what's going on. There's a real chance that the process taking place is the slow strangulation of major economies because of that monetary disfunction, raising taxes while the government has to borrow in order inject money from outside the commercial credit creation process.
Congratulations to Ben for demystifying a lot of the jargon and hype around government and political financing decisions. It’s the first time I’ve understood even half of it. Well done. Let’s hear more from Ben!
We need productive taxes that not only raise money but also saves money in the future. Like taxing crap food (bringing down NHS costs) and taxing carbon emissions and air/water pollution.
TFL is criminally inflating their major projects, all of which are paid for by central government. Silvertown Tunnel costs £180 Million to build, yet we are paying £2.2 Billion for that project.
@@davidwebb4904 I was trying to be positive ! a tunnel (while dark and dank) at least has an exit... we agree it is dismal finance either way. NS and NR should bone-up on the concept of "dismal finance" in a high debt MMT environment.
Borrowing is fine is you can afford to pay it back. If the market thinks we are borrowing too much they deem it more risky and put interest rates up on the debt , so can make it self defeating.
Just want to commend the new statesman for their analysis of this labour government. Fair, balanced, thoughtful. We could do with much more of this in the political discourse.
I saw someone say this on Twitter. It's incorrect. She did work for the Bank of England as well as having a degree in PPE from Oxford and a master's economics degree from LSE. She's definitely qualified whether or not you agree with her economics.
The concept of a “black hole” is Orwellian: it’s overwhelmingly Labour choosing to spend big money rather than avoid speding - as always it’s Labour tax-and-spend. It’s in their blood. Spend, spend spend, tax, tax, tax
The UK economy is in bad shape. You can cut spending or increase taxes or both. Alternativly increase your debt even more adding future stronger need for cuts, taxes and/or loans...
Yeah maybe taxes are higher in Europe but salaries are also higher, pensions are higher, services is a better and prices are generally lower because basic things such as energy and transport are nationalised. I’m sorry but I can’t justify paying more taxes for the services I am getting here.
Some European countries have higher income taxes but they don't have council tax and they provide affordable childcare and housing. It's comparing apples to oranges.
@nicksimmons7234 Exactly but people in UK are constantly manipulated into thinking they pay less tax then other European countries which is absolutely not true. And in other countries there is great infrastructure, affordable childcare, paid sick leave etc.
@@Ami-zo7mo yes and the problem in this country is our journalism. Only Labour get asked ‘how will you pay for it’. IFS have been off the TV and my podcasts for the last 12 months where have they been the last 14 years, on the news the day of the budget that’s it.
Regarding income tax thresholds, they should unfreeze the peronal allowance, which affects the poor, but I wouldn't object to them freezing the higher rate threshold (doing so is likely to affect me during the next few years - you could introduce a rate in between if you want to tax me now). I think they should harmonise the capital gains rate. If this was announced as something that would take place in stages over the next five years it might encourage some extra cash this year, whilst waiting for growth to take place.
No black hole but let’s borrow more money anyway! Changing the anti bankruptcy rules so we can go bankrupt, great plan! Financial credibility reputation on the floor. Recession here we come.
It's always taxes that is spoke about but never about increasing resources. How much money we have will never make a difference as the market always settles at the max price people are willing to pay regardless of how much money they have. If theres 1 house and 2 families want it then 1 goes without no matter how much money they all have.
I find it incredibly offensive to see the IFS on the program. Three letters masquerading as knowledgeable about the economy. Who provides their funding, please?
They have details on their website if you click ”about” and then “How we are funded”. I’m surprised you seem so bothered by this when it is so easy to find.
@nicksimmons7234 There are super rich people advocating this. Politically, the right wing hangers on of those super rich will make a lot of noise, bleating about tax and spend.
@@TootlinGeoff I just give up watching the news now, it's all gloom and doom. Get away from the rubbish spouted by the msm, and enjoy life. Embrace nature ,and your friends, and family.
Failure to invest in sustainable infrastructure - cancelling public transport schemes, insulation, energy saving - will leave us simply rearranging the deckchairs on the Titanic. The tough choice is to raise the money using the obvious sources - income tax, corporation tax and VAT, beside which the other taxes (CGT, IHT and others) pale into insignificance. By the way we don't need a single yard of more road building - the climate crisis should be directing us elsewhere.
I remember when Andrew Marr couldn't wait for Labour to get elected. I wonder if any members of his family have had their winter fuel allowance stopped?.
People were saying for ages the Tories were setting Labour up with poor finances and that's why Rishi called the election when he did. The Tories have completely screwed the public finances. Don't forget the highlights we got from them were stagnation
Surly increasing the minimum wage which has a knock on effect on wages as a whole but leaving the tax threshold of £12500 where it is would raise quite a lot in taxes without raising taxes as such.
Is this not what labour always has to do; borrow to invest to make up for the rape of the economy by the tories? And then when it is all on an even keel with the investment the tories come back in to skim the benefits of the investment (and sacrifice), so the cycle starts over again. And the tories obviously come back in and complain about the borrowing to invest. The system is basically a broken pendulum, interupted every 5 years for a reset of its swing. No equilibrium, which is the danger of a two party system.
She will see the destruction of industry and commerce. There is NO black hole. Labour re just committed to overspending as usual. Debt, debt and more debt. Wait for the Standard and Poors credit rating! That will put everyone’s mortgage and loans up! Thanks Starmer!
IFS have been very vocal and all over the TV and podcasts over the last 12 months. Can I ask where the IFS have been over the last 14 as the Tories screwed the country. As always double standards.
New Statesmen - stop referring to the balck hole - this is technically impossible for a Gov and keeps the false narrative about Gov finaces is just a bigger houshold budget. You should know better.
