Question about New Labours record on economy/investment

[larus]

I struggle to understand how Labour supporters can carp on about the record of investment in public services under New Labour, and that the financial crisis was nothing to do with Blair/Brown, but due to the problems caused by the City Of London, yet they never complain about the fact the the city with all of its 'profits' was contributing 25% of all tax revenues.

If you take 25% of the tax revenues out from before the financial meltdown, then our finances would have been in a disasterous state.

Without this 25% of tax revenues, there would have been a lot less for Brown/Blair to waste (sorry, invest), in public services (btw, the sarcasm is because Labour voters always seem to assume that spending money is good, irrespective of the value achieved).

 

[HH Brighton]

I struggle to understand how Labour supporters can carp on about the record of investment in public services under New Labour, and that the financial crisis was nothing to do with Blair/Brown, but due to the problems caused by the City Of London, yet they never complain about the fact the the city with all of its 'profits' was contributing 25% of all tax revenues.

If you take 25% of the tax revenues out from before the financial meltdown, then our finances would have been in a disasterous state.

Without this 25% of tax revenues, there would have been a lot less for Brown/Blair to waste (sorry, invest), in public services (btw, the sarcasm is because Labour voters always seem to assume that spending money is good, irrespective of the value achieved).

Oh no not 'Tory Boy' again

 

[larus]

Oh no not 'Tory Boy' again

Usual in-depth response .

My thoughts were triggered by the thread about Blair - hit or shit?

Thank you for your intelligent contribution to the deabte though. Close the door quietly please.

 

[El Presidente]

Usual in-depth response .

My thoughts were triggered by the thread about Blair - hit or shit?

Thank you for your intelligent contribution to the deabte though. Close the door quietly please.

OK, under Blair New Labour took a liberal approach to financial regulation in order to attract city related investment and jobs.

He gave the City a degree of self regulation, but left the rest to the BofE and the FSA, people who in theory have greater experience of the finance world and so would be better suited to acting as watchdogs.

The lax approach to lending and risk assessment in the US, combined with the repackaging of toxic debt and the mis-selling of it as more highly rated thanks to the collusion of S&P and their cronies, led to a global crisis.

It would not have made a blind bit of difference as to which party was in charge, given the global nature of modern finance in the West.

 

[larus]

OK, under Blair New Labour took a liberal approach to financial regulation in order to attract city related investment and jobs.

He gave the City a degree of self regulation, but left the rest to the BofE and the FSA, people who in theory have greater experience of the finance world and so would be better suited to acting as watchdogs.

The lax approach to lending and risk assessment in the US, combined with the repackaging of toxic debt and the mis-selling of it as more highly rated thanks to the collusion of S&P and their cronies, led to a global crisis.

It would not have made a blind bit of difference as to which party was in charge, given the global nature of modern finance in the West.

But the point I'm trying to make is that New Labour supporters go on about the amount of money 'invested' in public services, but this was from tax receipts generated via an industry which was, according to them, out of control becuase of the regulation (lack of), which they implemented.

 

[HH Brighton]

Usual in-depth response .

My thoughts were triggered by the thread about Blair - hit or shit?

Thank you for your intelligent contribution to the deabte though. Close the door quietly please.

 

[Simster]

I struggle to understand how Labour supporters can carp on about the record of investment in public services under New Labour, and that the financial crisis was nothing to do with Blair/Brown, but due to the problems caused by the City Of London, yet they never complain about the fact the the city with all of its 'profits' was contributing 25% of all tax revenues.

I'm not really sure what your point is. Why would any government "complain" about any industry paying its due in taxes? How has that got anything to do with whose fault the financial crisis was?

Do you want Labour supporters to feel eternally grateful that the City paid taxes in the good years then?

 

[strings]

Interesting point, however I think it is worth noting that the Tories were against tighter regulation too. In fact only the one-man-show that is Vince cable wanted tighter regulation.

 

[beorhthelm]

He gave the City a degree of self regulation, but left the rest to the BofE and the FSA, people who in theory have greater experience of the finance world and so would be better suited to acting as watchdogs.

i think you'll find half the problem was taking regulation away from the BoE, who would indeed be knowledgable and better suited, and gave it to the FSA who didnt have the right personel or focus. they spent their time worrying about the output of financial journalists who might ramp a stock, rather than the real issues of the what the wider market was upto. to be fair, alot of people even in the banks didnt understand what everyone was upto either, so they couldnt self-regulate. the international nature of the market didnt help, but noone even asked questions about where all the money was coming from. Brown had created a new economic paradigm, no one want to rock the boat.

so essentially, Brown allowed lax regulation and took all the credit and spent all the procedes, but blamed it on a global crisis (which his policy underpinned) when it went pear shaped. we'll never know if would have occured under the Tories, would they have allowed the unequipped FSA to run so far, would they have understood the risks (mates in the banks etc) and reigned it in?

 

[El Presidente]

i think you'll find half the problem was taking regulation away from the BoE, who would indeed be knowledgable and better suited, and gave it to the FSA who didnt have the right personel or focus. they spent their time worrying about the output of financial journalists who might ramp a stock, rather than the real issues of the what the wider market was upto. to be fair, alot of people even in the banks didnt understand what everyone was upto either, so they couldnt self-regulate. the international nature of the market didnt help, but noone even asked questions about where all the money was coming from. Brown had created a new economic paradigm, no one want to rock the boat.

so essentially, Brown allowed lax regulation and took all the credit and spent all the procedes, but blamed it on a global crisis (which his policy underpinned) when it went pear shaped. we'll never know if would have occured under the Tories, would they have allowed the unequipped FSA to run so far, would they have understood the risks (mates in the banks etc) and reigned it in?

Agree with you to a degree, but not convinced the B of E had the inclination or the teeth to do anything about it.

Having taught at all the big banks, the question I was asked most frequently was 'how can I take this off balance sheet', and where there's a will, there's a way.....

 

[larus]

I'm not really sure what your point is. Why would any government "complain" about any industry paying its due in taxes? How has that got anything to do with whose fault the financial crisis was?

Do you want Labour supporters to feel eternally grateful that the City paid taxes in the good years then?

But the point is, if the city was reckless and, by implication, needs to be controlled better, then the profits which it will (would have), generated would have been a lot less. This 'dishonest/fraudulant' profit wouldn't have been made, therefore, the tax revenues wouldn't have been there.

G.B/T.B/New Labour supporters have claimed that so much was invested in public services which was all their good work because they were running such a strong eceonomy. Yet when this have been seen to be not such a good thing, it's a case of 'not my fault guv'.

Personally, I don't blame the city for the mess that we are in; however I do blame the government for the structural problem with the budget. Financial service have provided a lot more benefit to this country than problems IMO.

The city didn't force people to take out mortgages; the banks didn't force people to borrow excessively on credit cards; the bank didn't force up house prices.

 

[withdeanwombat]

Interesting point, however I think it is worth noting that the Tories were against tighter regulation too. In fact only the one-man-show that is Vince cable wanted tighter regulation.

Show?

You mean pantomime,surely?

 

[Simster]

But the point is, if the city was reckless and, by implication, needs to be controlled better, then the profits which it will (would have), generated would have been a lot less. This 'dishonest/fraudulant' profit wouldn't have been made, therefore, the tax revenues wouldn't have been there.

G.B/T.B/New Labour supporters have claimed that so much was invested in public services which was all their good work because they were running such a strong eceonomy. Yet when this have been seen to be not such a good thing, it's a case of 'not my fault guv'.

Personally, I don't blame the city for the mess that we are in; however I do blame the government for the structural problem with the budget. Financial service have provided a lot more benefit to this country than problems IMO.

The city didn't force people to take out mortgages; the banks didn't force people to borrow excessively on credit cards; the bank didn't force up house prices.

Oh right. Well I'm a left of centre voter and I do blame the Labour government for not regulating the city properly, and for not regulating the mortgage industry long before now, and for wreckless spending (I'm quite happy to run a borrowing deficit, as long as it's manageable. What Labour have done is wreckless and disgraceful).

I doubt there are many people who don't blame the government for something or other.

 

[Lord Bracknell]

... Brown/Blair to waste (sorry, invest), in public services (btw, the sarcasm is because Labour voters always seem to assume that spending money is good, irrespective of the value achieved).

I'm struggling to see what's automatically wasteful about spending money on new schools and hospitals, more nurses, better social care for older people or kitting out the armed forces.

 

[withdeanwombat]

I'm struggling to see what's automatically wasteful about spending money on new schools and hospitals, more nurses, better social care for older people or kitting out the armed forces.

Oh come on,stop being so bloody sensible.

Open your Daily Mail,read the truth and then come back on here and apologise.

 

[Chicken Runner61]

But the point is, if the city was reckless and, by implication, needs to be controlled better, then the profits which it will (would have), generated would have been a lot less. This 'dishonest/fraudulant' profit wouldn't have been made, therefore, the tax revenues wouldn't have been there.

G.B/T.B/New Labour supporters have claimed that so much was invested in public services which was all their good work because they were running such a strong eceonomy. Yet when this have been seen to be not such a good thing, it's a case of 'not my fault guv'.

Personally, I don't blame the city for the mess that we are in; however I do blame the government for the structural problem with the budget. Financial service have provided a lot more benefit to this country than problems IMO.

The city didn't force people to take out mortgages; the banks didn't force people to borrow excessively on credit cards; the bank didn't force up house prices.

Oh come of it Larus - Financial services is a broad church that can cover stock market penny share gambling to packaged up toxic loan books.

Even in the home banking sector there is a vast difference in how say a mutual society and a loan company can operate.

The banks sold loans as a life style they might not have forced people to take them but they sure went out of their way to make them as attractive and easy to get as they could - they still are doing it.

And if you somehow split out the city traders away from banks their actions in the whole sorry affair makes them complicit in what the banks were doing.

In the end a few people in the city and banks made a lot of money out of a lot of innocent people.

 

[larus]

I'm struggling to see what's automatically wasteful about spending money on new schools and hospitals, more nurses, better social care for older people or kitting out the armed forces.

And I struggle to understand why it is always assumed that throwing huge sums of money is always the right answer. As soon as anyone start to talk about accountability/value for money, the assumption is this is 'just wanting to cut public servies and give tax cuts to the rich'.

You seem to assume that spending lots of money is a good thing. For example, the PFI schemes (set-up by the Tories and expanded hugely under Labour), is a complete waste of tax-payers money. Private companies are going to make huge, guaranteed profits for years, due to the contracts signed. This is an example of throwing money at a problem, but not getting value for money.

I do not have an issue paying taxes; I don't have an issue with public services. I do have an issue with money being wasted.

 

[Castello]

And I struggle to understand why it is always assumed that throwing huge sums of money is always the right answer. As soon as anyone start to talk about accountability/value for money, the assumption is this is 'just wanting to cut public servies and give tax cuts to the rich'.

You seem to assume that spending lots of money is a good thing. For example, the PFI schemes (set-up by the Tories and expanded hugely under Labour), is a complete waste of tax-payers money. Private companies are going to make huge, guaranteed profits for years, due to the contracts signed. This is an example of throwing money at a problem, but not getting value for money.

I do not have an issue paying taxes; I don't have an issue with public services. I do have an issue with money being wasted.

It seems that the only person who thinks anyone thinks this is you.

I think most people would believe that giving an almost blank cheque to the banking industry to bail them out was incredibly foolish and wasteful.

 

[larus]

It seems that the only person who thinks anyone thinks this is you.

I think most people would believe that giving an almost blank cheque to the banking industry to bail them out was incredibly foolish and wasteful.

Totally missed my original point about the 25% tax revenues and 'investment' in public services.

Never mind; carry on.

 

[El Presidente]

Totally missed my original point about the 25% tax revenues and 'investment' in public services.

Never mind; carry on.

The reason why the financial services industry contributed such huge sums to the Treasury was that they were making far larger sums in profits.

I don't have an issue with it, so long as it is done honestly and ethically, words which are lacking in a banker's vocabulary.

As for government regulation, it is a non starter in reality, most bankers/lawyers/accountants are smarter than politicians, and can easily circumnavigate the rules, especially since the globalisation of the industry.