Coffee House

The autumn statement was the antithesis of the Budget

5 December 2012

6:36 PM

5 December 2012

6:36 PM

George Osborne was in good spirits when he turned up to address the 1922 Committee of Conservative backbenchers. He received a warm reception. The sense was that the autumn statement had avoided the last Budget’s mistakes. As one senior Tory MP said to me afterwards, ‘it shows what he can do when he puts his mind to the job.’ This backhanded compliment sums up the mood among Tories tonight.

In his speech, Osborne stressed the importance of cancelling the 3p rise in fuel duty. He told them that they should tell voters that this shows that the government understands how hard family budgets are being squeezed right now and is trying to help.

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Tory MPs are also pleased with the politics of a Commons vote on limiting the increases in working age benefits to 1% for the next three years. They are convinced that if Labour oppose this move, it will help the Tories win votes.

Take today’s statement alongside Cameron’s sure-footed response to Leveson and one can make the case that the Tory leadership is showing grip at the moment.

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  • The_Missing_Think

    I presume our European bureaucrats across the English channel have taken note of the austere one percent increment for public sector workers and benefit claiments being implemented here.

    Let’s just pray our EU friends wanting five percent, calmly agree it’s not really worth getting worked up about, and definitely not worth falling out over… ohhh no… and any Westminster vote on a two percent or greater rise, shouldn’t be too tricky a problem, with no opportunistic rebellions to worry about… hopefully.

  • dalai guevara

    When not raising a tax (that is already ludicrously high) is hailed as a great leap forward deserving a warm reception, then for all we know, another senior Tory MP might think we are just treading water.

    • HooksLaw

      You mean cancelling a socialist tax rise surely?

      • dalai guevara

        A socialist tax in nature introduced by socialists surely?

      • TomTom

        Oh you mean beer duty which has risen 42% since 2008 on the Beer Escalator or the fact that taxes on Wine and Beer are 11 times German levels and second only to Finland ?

  • Tarka the Rotter

    If 72% of the average income is paid now to the state via income tax, NI, VAT and all the taxes and levels attached to practically everything, what’s the % going to be when Commissar Balls returns? Why the hell do we put up with this?

    • HJ777

      From where did you get your 72% figure?

      I strongly suspect that you are confusing effective marginal rates (including benefit withdrawal) with the overall tax take (which is somewhat lower, albeit still too high).

      • TomTom

        On average 40% income disappears to the state then add VAT, Council Tax, Alcohol Duties, and pretty soon you are up to 80% never mind 72%.

        • HJ777

          I accept that taxes are too high, but the facts don’t support the assertion that 72% or more of the average income goes to the state.

          • TomTom

            Work it out – taxpayer and all taxes on spending and goods purchased. You could do it for yourself and tell us

            • Daniel Maris

              Probably true if you drink, smoke and have a car.

    • TomTom

      It is over. It is these puppets in Westminster that cannot shake off the TV lights and makeup. Their show is finished. What lies ahead will dispense with these puppets as life takes a turn round a sharp bend and violence becomes more prevalent.

  • Colonel Mustard

    For those who were saving themselves, starry-eyed, for the charisma of Ed Balls:-

    “The main betting market response to today’s autumn statement has been an easing in the price of Ed Balls in the next chancellor market. Ladbrokes had him as 6/4 favourite which has now moved out to 2/1.”

  • Daniel Maris

    Why are you talking up someone who, by your own admission, is managing to double the national debt in the space of 5 years, at a time when the debt was already at record levels, whilst at the same time impoverishing the lower middle classes, driving down wroking conditions and encouraging mass immigration?

    • HooksLaw

      Because, you thick idiot, the running deficit inherited in 2010 was so huge that even if Labour were in power the debt would have doubled – unless you wanted to pursue an economic policy consistent with slaughtering the firstborn.
      Only the thickest of arseholes would come out with that argument.

      Furthermore Mr Dipstick In 2001 the debt was £312 billion in but in 2008 it was £525 billion; that was under Labour. This was when we had growth and not faced with an economy 7% smaller than in 2007.
      As a socialist cheerleader I would suggest you STFU about immigration.

      • HellforLeather

        I have no time for Balls, Labour or other socialist tribes.

        But, you really are poison. I think that in modern parlance, you’d fall into the “Troll” tribe.

      • Daniel Maris

        Not sure what all the abuse is about…a sign that you feel a little discomfited about supporting a government committed to borrowing an additional £27,000 per household – or something like that?

        If I felt this government were travelling in the right direction, I might accept some of the risks inherent in this policy but it seems to me they are badly wrong on just about everything.

        I would describe myself as a populist, not a socialist. I am fully entitled to raise my concerns about mass immigration – a policy which very few people (including people living here as a result of recent immigration) approve of. Like the debt, it is a high risk strategy that is NOT sustainable in the long term – well not in the sense of preserving our per capita GDP, which has been going down steadily for the last five years.

      • TomTom

        You may find that the Policy does NOT work. ZIRP is socialising the economy and acts as a form of crushing Deflation on the Private Sector. Watch the bankruptcies mount over the next 18 months. The Government Deficit is only a major problem because Osborne made it one in February 2010…………….http://www.telegraph.co.uk/news/election-2010/7309703/George-Osborne-cut-debt-now-or-face-economic-disaster.html………………….. The whole policy of switching to Private Sector Growth has proven as big a failure as Blair’s 1997 Pledge to switch resources from Benefits to People In Work. It has shown just how ineffectual British Goverbment is and how dangerously off-the -rails the whole political system has become. …………….All this rubbish about Deficits is fatuous simply because the measurements are flawed anyway. It is the BANKS that are extracting REAL resources from the Taxpayer PLUS from Households with Usurious rates of Interest and Credit Rationing……………The Deficit that matters is the BIG BLACK HOLE in the Balance Sheets of Banks who have fake accounts and will not reveal just how much gambling debt they are carrying. There is no way the Government will ever get out of this mess in the next 40 years if the Banks are not restructured completely and some of their debt repudiated. Much of the debt is simply daisy-chain derivatives. The real problem in the Sovereign Gold Reserves that London has loaned out to these Banks and which Germany and Austria now want to have checked physically – and of course like Gordon Brown in 1999 they do not actually have their gold

    • HJ777

      Given that Osborne inherited a record deficit of around 12% of GDP, it would be very interesting to hear your explanation of what he could have done to avoid doubling the debt over the following five years.

      Could you enlighten us please?

      • TomTom

        Well he could have slashed DfID Budgets making them stay in budget hotels and fly economy so they did not emarrass expats with their affluence abroad. He could have issued a Clawback on PFI deals and demanded Banks in receipt of Government Welfare Support turn over PFI deals to The State and write them off. It would have been very easy to have all Housing Benefit Landlords audited by HMRC. It did not need VAT to rise from 15% to 20% in the space of 12 months unless it wanted to crash the economy.

        • HJ777

          TomTom – I wasn’t claiming that Osborne couldn’t have done anything about cutting the deficit faster (and thus limiting the rise in debt). I certainly would advocate doing more with far more drastic cuts in spending, for example.

          I was asking Daniel Maris what HE would do, given that he is so critical of Osborne (and as he has previously criticised spending cuts).

          • TomTom

            Fair enough

          • Dimoto

            Dan Maris would advise Osborne to use his magic wand – the same wand that will render wind-mills and cold fusion (to name but two) our ‘economic salvation’.

            • Daniel Maris

              Well, wind turbines are definitely part of our national economic salvation . On cold fusion the jury is still out, but there is a lot of activity. It’s just the MSM aren’t reporting it I’m afraid. But expect some key announcements very soon.

              I was interested to note that the gas fracking technology came to fruition as a result of a public sector governmental initiative under Jimmy Carter’s Presidency in the USA. What a marvellous example!

              I would love us to apply a similar approach to cold fusion. I think there is indeed “gold in them thar hills”. We will see shortly if I am right. It would be great for the UK to be in on the ground floor of this new technology but I doubt we will be. It looks like the USA, Canada and Italy are most likely to be in the forefront of the technology.

              As with wind turbines, where we handed it all over to Denmark, it looks we are losing out on the chance to make billions from a new energy industry.

            • Daniel Maris

              Just to show I’m not making up the growing interest in cold fusion (aka as LENR – low energy nuclear reactions):

              *ttps://reportingtheworldover.wordpress.com/2011/12/18/royal-dutch-shell-looking-at-lenr-as-game-changer/

          • Daniel Maris

            Well, of course I am not Chancellor, but I did warn you all that Osborne was striking terror into families across Britain thinking their breadwinners were going to lose their jobs (the whole of the public sector just about and a large chunk of the private sector working on or with the public sector). So firstly, I wouldn’t have done that. I would have brought in a managed recruitment freeze into the public sector to realise savings on wages. That would have been less of a dent in consumer confidence.

            As to what I would do more generally I would suggest:

            1. Greater taxation, mostly focussed on higher earners. When you cut their disposable income they very often cut back on things like foreign holidays and second homes abroad. I would certainly have gone for a Mansions Tax but with regional banding. There are lots of people in the provinces who have a lot of disposable income but don’t have two million pound houses. You’d probably want to start the tax around £500,000 in the poorer parts of the country.

            2. I think I would have been looking to stop the huge rise in the debt. I don’t have the exact figures but I guess if the Tories/Lib Dems are adding £600 billion to the debt over 5 years, I think we ought to really be looking to add only £200 billion over 3 years and then start paying down the debt. We would need to increase our tax take substantially – by something like 10%-15% I would think. It may well take us into another recession, but I think the country could cope with that if it knew the government was in practice looking to treat people fairly. Allowing CEOs 27% increases while there is a public sector freeze and benefits are being cut is not an exercise in fairness.

            3. I would look to cut the NHS budget, probably the most unproductive part of our public expenditure.

            4. I would have used QE for direct stimulation of the economy e.g. through distribution of “gift tokens” (as the Japanese did). I think that would have a strong effect in the UK, much stronger than among the cautious Japanese, in encouraging more consumer confidence.

            5. I would focus on the real economy – so would pump more money into supporting manufacturing in lots of ways (not necessarily through direct subsidy), establish a national enterprise agency to help grow manufacturing, create a stronger framework for university-business co-operation, to develop products, and do much more to market products abroad. I would be inclined as far as possible to let the financial sector look after itself.

            6. I would introduce a 2-5 year moratorium on mass immigration and naturalisation. As the ONS have pointed out mass immigration has been eroding per capita GDP. We need to focus on per capita as a wealth measure, not gross GDP.

            I think that’s enough for this forum!

  • Wilhelm

    Moving the coffins around the crypt, when really, the important thing is the demographics.

    • HooksLaw

      Ah – you have invented a new word for your perversion. Quite commendable really.

  • Wilhelm

    i saw Forsyth on television, he looks about 14, is there anyone on the Spectator who’s over 35 ? and don’t say Rod Liddle, he’s the exception to the rule.

    • Daniel Maris

      As long as they are under 18 they don’t have to pay the full minimum wage.

    • HooksLaw

      That is still double your mental age you racist moron.

      • Christian Jones

        Wacist wacist wacist! Yawn…….

      • Dan

        Whereas you are an angry moron HooksLaw, get a grip of yourself

    • TomTom

      Winchester and Jesus, Cantab. so he fits the mould – connected and clueless

  • Daniel Maris

    There’s a point at which, in any disastrous campaign led by a grandiose and deluded figure that a kind of giddy self-confidence and assurance in destiny sets in. All completely misplaced of course. Call it denial if you like.

    So it is now. All that matters really is that Osborne is planning to double the national debt by 2015; that people’s living standards are being eroded tremendously; that Osborne is continuing to pursue an ideological war on the public sector; and that the (related) policies of mass immigration and fawning on our financial sector are doing immense damage to our country.

    • HooksLaw

      ‘Denial’ – go look that world up before you bother posting again.

      • Dan

        Are you tired HooksLaw, or are you always this angry?

        • Daniel Maris

          He gets angry when he sees the key figures in the metropolitan elite completely screw up on the economy. Managerial competence is supposed to be the light that blinds the plebs. If they are shown to be incompetent, the game is up.

  • http://twitter.com/LoganDon don logan

    To be fair after Osborne’s car crash of a budget, the bar had been set very, very low.

    • telemachus

      today was OK he cancelled the 3p petrol hike
      1922 happy
      It doesn’t take much
      Reality will dawn as we slouch into the triple dip

      • Colonel Mustard

        Look at the way this creep telemachus operates. Hooking onto the first comment like a tapeworm rather than posting his own comment.

        What a creepy little creepoid from the planet Creepo.

        • telemachus

          What about the triple dip

          • Colonel Mustard

            Is that the new buzz phrase from Labour HQ that you were given in your troll briefing?

            • http://www.coffeehousewall.co.uk/ Coffeehousewall

              It is reasonable to conclude that telemachus is paid by the Spectator or is known to staff or represents the views of the owners. No site would allow his poisonous posturing unless it benefitted from it or agreed with it. The Spectator may well feel that all traffic is good even if it is faux-Marxist.

        • Swiss Bob

          It makes you wonder why the Spectator allows his trolling given he destroys threads with his verbal diarrhea.

      • Dimoto

        And didn’t your friend, the “charismatic one” do well ?
        The whole Labour front-bench looked embarrassed, a real ‘face-palm’ moment !

        • telemachus

          Charisma does not depend on victory at every turn
          Remember Thatcher in 1981
          Remember the Munich Putch
          Remember Wilson in June 1970

          • TomTom

            or Sheffield 1992

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