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Labour Leader: Keir Starmer VI

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Just because 2 things are disarticulated to some extent does not mean they are entirely independent.

The lie is that government spending is wholly dependent on tax receipts. This is a crucial lie which causes untold damage when effectively weaponised in public discourse/the public's minds. But opposing the perpetuation of the lie does not amount to a claim that tax and government spending are completely irrelevant to one another.
 
ks.234 said:
But what you haven’t done is show your evidence for your own thinking behind your belief that tax does in fact fund our government’s spending
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I can’t because any economy is a complex structure that relies on multiple inputs and outputs being within range to function in a stable manner. Taxation is one key part of the picture. I am no economist so very much the wrong person to get into an argument here, but I am absolutely certain you can’t reduce it to the statements you seem to desire. This can never be anything other than a highly complex interaction between growth, inflation, taxation, public sector deficit/surplus, private sector deficit/surplus, employment, productivity, currency valuation, international investment, imports, exports and many, many other factors. MMT seems to need very precise pre-existing conditions to be theoretically viable and I’d love to see it tested somewhere.

PS I apologise if I come over as patronising. It is really not my intent. I have no education of any value, certainly no qualification or expertise in this field. I just see enough to grasp this is an extraordinarily complex multi-factored system.
 
Cav said:
Something from OBR: A brief guide to the UK public finances (obr.uk)

Now, this does not actually say that tax is used directly fund Government spending, but it does say it reduces the need for borrowing (or if revenue exceeds expenditure) to form a surplus.

It might be that the Government borrows all the money it uses to run the country and tax revenue is used to pay some of the interest on that.

Does not really matter does it?

Happy not to pay tax if it is not needed.
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The government does have a duty to balance the books, so that tax (and borrowing) will be used to offset spending on the various spreadsheets.

It does matter because notion that our government’s spending is constrained tax revenue is what is used to strangle spending on public services like Health and Education.

It should also be noted that if government were to run a surplus then there would a deficit in the private sector that could only be overcome by commercial banks creating money from debts. It was the expansion of private debt that was one of the causes of the 2008 crash

Unfortunately, while your tax does not fund government spending, it will still be needed for other purposes
 
notaclue said:
He's closing in at 1 point a day. 20 points ahead by the end of the month, at this rate...

LAB: 40% (+2)
CON: 29% (+1)
LDEM: 11% (-2)
GRN: 6% (-1)
REFUK: 6% (+2)

via @YouGov

Prime Minister Starmer? Could be.
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Never mind the end of the month, he'll be 20 points ahead by the end of tomorrow. Now 14 points ahead, according to one poll https://twitter.com/Direthoughts/status/1482079893919838208

And all it took was for Johnson to throw a party to celebrate the Queen's husband dying. Or something like that.
 
Doh! No wonder he's always getting Covid.

"He's just like all the rest," the fickle public will say.

FJGAcSkX0AUzO53
 
Tony L said:
I can’t because any economy is a complex structure that relies on multiple inputs and outputs being within range to function in a stable manner. Taxation is one key part of the picture. I am no economist so very much the wrong person to get into an argument here, but I am absolutely certain you can’t reduce it to the statements you seem to desire. This can never be anything other than a highly complex interaction between growth, inflation, taxation, public sector deficit/surplus, private sector deficit/surplus, employment, productivity, currency valuation, international investment, imports, exports and many, many other factors. MMT seems to need very precise pre-existing conditions to be theoretically viable and I’d love to see it tested somewhere.

PS I apologise if I come over as patronising. It is really not my intent. I have no education of any value, certainly no qualification or expertise in this field. I just see enough to grasp this is an extraordinarily complex multi-factored system.
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Sorry, but while the economy is indeed complex (and a lot more complex than it need be) the question is very simple. You said the notion that tax does not fund spending was “ridiculous”. If it is ridiculous it should be simple to say why. Hiding behind a fog of complexity does not add clarity to your thoughts. If you ridicule an idea but then can’t point to the evidential basis for your ridicule, then perhaps the foundations of your belief are not as solid as you presume.

I thank you for your apology, and will not push the question further at this point, but I would ask that you at least consider that the idea tax does not fund our government spending is not “ridiculous” and as a minimum warrants further investigation because the consequences are as far reaching as understanding that the earth is not actually going around the sun!
 
ks.234 said:
Sorry, but while the economy is indeed complex (and a lot more complex than it need be) the question is very simple. You said the notion that tax does not fund spending was “ridiculous”. If it is ridiculous it should be simple to say why. Hiding behind a fog of complexity does not add clarity to your thoughts. If you ridicule an idea but then can’t point to the evidential basis for your ridicule, then perhaps the foundations of your belief are not as solid as you presume.
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The Wikipedia entry on tax might be worth your reading. Here’s the first paragraph:

“A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures (regional, local, or national).”

And from further down the entry:

“The purpose of taxation is to provide for government spending without inflation. The provision of public goods such as roads and other infrastructure, schools, a social safety net, public health systems, national defense, law enforcement, and a courts system increases the economic welfare of society if the benefit outweighs the costs involved.”

To my mind this places the burden of responsibility 100% on you to prove tax is whatever you seem to think it is. I’ll happily take this definition as a reference.
 
Did you update that wiki entry Tony? After all that's all wiki is, the last person to go on there can alter it, we've had fun here when people have amended wiki to call tories crooks.
 
Enfield boy said:
Did you update that wiki entry Tony? After all that's all wiki is, the last person to go on there can alter it, we've had fun here when people have amended wiki to call tories crooks.
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Wikipedia is a remarkably good reference point IMO, arguably the best single repository of knowledge on the planet. Sure, some very minor entries can be tampered-with temporarily on occasion for political or egotistical reasons, but major entries are vastly more robust, well cited, and peer reviewed. I’d argue you had to be way out on the extreme fringes of politics to argue with the definitions I pasted here.

None of that entry is in conflict with MMT or Keynes to my eyes. The moment of creation is not the whole lifecycle of spending. It is not the whole picture and not even Stephanie Kelton would claim it was. I am not arguing with her at all.

PS Suck Here is giving a speech on Sky News now.
 
Tony L said:
The Wikipedia entry on tax might be worth your reading. Here’s the first paragraph:

“A tax is a compulsory financial charge or some other type of levy imposed on a taxpayer (an individual or legal entity) by a governmental organization in order to fund government spending and various public expenditures (regional, local, or national).”

And from further down the entry:

“The purpose of taxation is to provide for government spending without inflation. The provision of public goods such as roads and other infrastructure, schools, a social safety net, public health systems, national defense, law enforcement, and a courts system increases the economic welfare of society if the benefit outweighs the costs involved.”

To my mind this places the burden of responsibility 100% on you to prove tax is whatever you seem to think it is. I’ll happily take this definition as a reference.
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Yes, there will be any number of sources that back up the government line. It would be rather surprising if there weren’t. Just a bit surprising it took you so long to find one. But all they do is repeat the line with no evidence or explanation to back it up, and what I’ve been asking for all this time is the evidence to back up the claim.

I have provided a great deal of evidence that tax does not fund government spending; evidence from prominent economists, the Bank of England, and cold hard logic. But you are essentially asking me to prove a negative, which is rather like trying to prove that God does not exist to the true devotee.

If our government issues money, then as a matter of simple logic, Tax cannot be the necessary source of money. If government has the capacity to issue money, it does not have to use tax. The fact that the government chooses to say that the taxpayer has to pay for expenditure is a political choice, not an operational necessity. If Government is the issuer of money then it obviously cannot run out of the thing it issues. There are very real constraints on issuing money (like inflation) but precisely because government issues money, another pot of money called tax is not one of them.

The idea that our government issues money into the economy, takes some back in tax and then claims it’s issuance is limited to what it takes back is clearly nonsensical.

But hey, as you’ve indicated that you are not interested reading any of the voluminous evidence that questions your belief and seem determined to cling to that belief without an evidential basis beyond mere assertion, then I’ll leave it there for now
 
Tony L said:
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None of that entry is in conflict with MMT or Keynes to my eyes..
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That is bizarre. The starting point of MMT is that tax does not fund spending, and as I keep being told the MMT and Keynes are one and the same, I presume Keynesians believe that tax does not fund spending too.

The Wiki piece you quoted is in conflict with MMT and Kelton, and fundamentally so
 
ks.234 said:
I have provided a great deal of evidence that tax does not fund government spending; evidence from prominent economists, the Bank of England, and cold hard logic. But you are essentially asking me to prove a negative, which is rather like trying to prove that God does not exist to the true devotee.
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You haven’t proved anything at all as you are way out on a limb apparently confused by the way government spending is created and blind to the long term effects and balancing. To put it another way you are arguing with Stephanie Kelton, Keynesian economics and the whole of academic theory, not with me. I politely suggest you rewatch the YouTube videos as I’m sorry, and I don’t mean to be rude, but you haven’t understood this.

As I understand it what Kelton is saying is by using inflation and employment as the key metrics in a Keynesian economy it is largely possible to offset government spending against the taxation raised by the employment it creates, i.e. ‘free shit’! This makes a lot of sense and has its roots way back in FDR’s America (Hoover Dam etc). The fact a government can create money gives enough of a time-delay to allow this approach without the inevitable spiralling inflation that comes from money printing. MMT is not magic money tree economics (which always leads to inflation and currency devaluation). To my understanding you are entirely missing this time-delay aspect as well as not grasping the critical impact of pubic and private sector deficits/surpluses, imports, exports, internal investment etc etc. Again, I am not arguing with Kelton etc, she fully understands and articulates all these factors and never once argues to remove taxation! Basically you need at least one more axis on your mental graph.
 
ks.234 said:
That is bizarre. The starting point of MMT is that tax does not fund spending, and as I keep being told the MMT and Keynes are one and the same, I presume Keynesians believe that tax does not fund spending too.

The Wiki piece you quoted is in conflict with MMT and Kelton, and fundamentally so
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So what does the Government do with the annual £850b it gets in revenue? Genuinely interested.
 
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