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Labour Leader: Keir Starmer VII

MUTTY1 said:
Yer I know how PMQ’s works. What I am saying is Starmer isn’t very good at it. Look at it again, Sunak pointed out Starmer reads from a script. It’s a valid point. Everyone knows PMQ is a circus. But you still need to be good at it. It’s part of the basic toolkit of every leader unfortunately.
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You need to look beyond the circus, and realise that it’s two dogs fighting over the same bone.

We need a different bone.
 
ks.234 said:
http://bilbo.economicoutlook.net/blog/?p=33907
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Thank you for the providing the link.

The author is obviously being very selective with his choice of data to substantiate his arguments - so its economic history through a very particular lens - and ignores for example the large public subsidies given to nationalised industries at the time partly to ameliorate unemployment. The Labour government also had an industrial strategy which is the antithesis of the laissez-faire approach favoured by neoliberals and Callaghan's 1976 conference speech has an entire paragraph devoted to making the UK's industrial relations like Germany's - surely the quintessential social democratic model.
 
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I think the next GE is likely to be in May next year i.e. sixteen months away given the government won’t want to look desperate by waiting until the last opportunity which would be autumn 2024.
 
gavreid said:
This is a good piece on inflation - might as well put it here since where ever the US goes the UK will surely follow

How should you fight inflation? (Spoiler alert: not with interest rate rises)
Joseph Stiglitz

US inflation is mainly supply-side driven so further rate hikes will have little to no effect – and cause deep problems of their own

https://www.theguardian.com/busines...on-spoiler-alert-not-with-interest-rate-rises
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Apologies to @Mullardman and our recent discussion about ideology, but the fact that the only tool we have to fight inflation today is down to our half century old economic ideology

Our current ideology that still worships Milton Killer Friedman*, assumes that “inflation is always and everywhere a monetary phenomenon…produced only by an increase in the quantity of money than in output”, therefore the only solution is to suppress aggregate demand, by which such economists mean our spending power. The way they do this is to raise interest rates to depress wage demands and threaten more unemployment.

But as Stieglitz points out, inflation actually has different causes and continually suppressing money supply will only make things worse at a time when people need more money to meet rising prices.

Our current ideology tells us that we need this short term pain to enable long term growth and a high wage economy. But we have been told that for 50 year and it still hasn’t happened.

It has happened because the ideology is both demonstrably flawed and built on false assumptions, yet still current

Alternative ideologies are available.
 
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ks.234 said:
Our current ideology that still worships Milton Killer Friedman*, assumes that “inflation is always and everywhere a monetary phenomenon…produced only by an increase in the quantity of money than in output”, therefore the only solution is to suppress aggregate demand, by which such economists mean our spending power. The way they do this is to raise interest rates to depress wage demands and threaten more unemployment.
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In the case of the pandemic the money supply expanded AND the economic output contracted, so in that sense Friedman wasn't wrong - it's just that we don't usually see output contractions of the type we did during the pandemic.

I do agree with Stiglitz that, where inflation was caused by supply side issues the government should be helping to ease these - housing is a good example - a multi-decade missed opportunity in the UK. I think in the case of our current situation we needed a combination of more modest interest rate rises (because some inflation - notably services inflation - likely was in large part down to pent up demand - for example for vacations and travel) and government stimulus help for industries to improve supply.

I think also that it's not so much that the Fed and other central banks have done the wrong thing, but that they used the only tool at their disposal, because the politicians didn't do their bit on the supply side. The lack of political action is, as you mention, due to decades of anti-government, pro "free-market" propaganda.
 
sean99 said:
In the case of the pandemic the money supply expanded AND the economic output contracted, so in that sense Friedman wasn't wrong - it's just that we don't usually see output contractions of the type we did during the pandemic.

I do agree with Stiglitz that, where inflation was caused by supply side issues the government should be helping to ease these - housing is a good example - a multi-decade missed opportunity in the UK. I think in the case of our current situation we needed a combination of more modest interest rate rises (because some inflation - notably services inflation - likely was in large part down to pent up demand - for example for vacations and travel) and government stimulus help for industries to improve supply.

I think also that it's not so much that the Fed and other central banks have done the wrong thing, but that they used the only tool at their disposal, because the politicians didn't do their bit on the supply side. The lack of political action is, as you mention, due to decades of anti-government, pro "free-market" propaganda.
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I suspect we’re not disagreeing about very much, though I would like to pick up a couple of points.

First, the pandemic spending did not cause inflation as Friedman said ‘always and everywhere’ it would, and the drop in output was not a consequence of money supply, but people being unable to work due to Covid restrictions.

Second I would disagree that we need interest rate rises right now, a better way to control inflation would be to give everyone who wants one, a well paid job on a living wage with holidays, a pension and decent working conditions.

Agree totally that Central Banks are restricted to the one blunt and inappropriate tool of interest rates by the chosen economic ideology of government.

TINA has a lot to answer for!
 
ks.234 said:
First, the pandemic spending did not cause inflation as Friedman said ‘always and everywhere’ it would
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I think it caused SOME of the inflation because some of the pandemic spending accumulated in people's bank accounts and was used to fund post-pandemic (pent up demand) spending. The pandemic spending was necessary to prevent a depression, but I think the scale of the spending necessarily led to some inflation.

ks.234 said:
, and the drop in output was not a consequence of money supply, but people being unable to work due to Covid restrictions.
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I completely agree with this.

ks.234 said:
Second I would disagree that we need interest rate rises right now, a better way to control inflation would be to give everyone who wants one, a well paid job on a living wage with holidays, a pension and decent working conditions.
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I think whether that would be inflationary or not would depend on whether the output of those folks balanced the spending. For example if we gave everyone jobs sweeping the streets (which would make our environment nicer) it would put a lot more money into the economy without increasing the supply of houses, cars, food etc etc - which seems like it should be inflationary. If government created an environment where everyone had a job producing in-demand goods and services then things might balance out and not be inflationary.

ks.234 said:
Agree totally that Central Banks are restricted to the one blunt and inappropriate tool of interest rates by the chosen economic ideology of government.
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Agree. They couldn't sit by and do nothing with inflation approaching 10% so they did what they could.
 
ks.234 said:
Apologies to @Mullardman and our recent discussion about ideology, but the fact that the only tool we have to fight inflation today is down to our half century old economic ideology

Our current ideology that still worships Milton Killer Friedman*, assumes that “inflation is always and everywhere a monetary phenomenon…produced only by an increase in the quantity of money than in output”, therefore the only solution is to suppress aggregate demand, by which such economists mean our spending power. The way they do this is to raise interest rates to depress wage demands and threaten more unemployment.

But as Stieglitz points out, inflation actually has different causes and continually suppressing money supply will only make things worse at a time when people need more money to meet rising prices.

Our current ideology tells us that we need this short term pain to enable long term growth and a high wage economy. But we have been told that for 50 year and it still hasn’t happened.

It has happened because the ideology is both demonstrably flawed and built on false assumptions, yet still current

Alternative ideologies are available.
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As I said.. we are very close and in danger of descending into semantics. Maybe if I put it this way...

Yes, I know very well what Friedman's Monetarism means. I also understand the fundamentals of Keynsianism. I was at Uni as a very impoverished mature student just after Thatcher came to power and of course the Friedman v Keynes debate was very current. It featured very prominently in discussions surrounding the course 'The History of Economic Thought', which comprised 20% of my first year studies, though, as the name implies, the course was a pretty cursory one, covering economic thought from Plato, via Scholasticism, Feudalism, Bullionism, the rise of Capital(ism), the Marxist response, etc, etc.. to Keynes and Friedman.

So yes, I accept that sadly, the currently predominant ideology is Friedman/Thatcher/Monetarist based. But that's not really the point I'm making...

My point is, put simply, that even if I subscribed to the 'technical' premises and assumptions inherent in Friedman et. al., (which I don't) and even if I believed (which I don't) in say, Privatisation.. It would not follow that it is 'good thing', to achieve privatisation by flogging Children's Homes, Health Care, etc., etc., etc. to offshore interests, foreign govts, etc.,etc.,etc.

It is the fact that so much Privatisation has led to precisely those evils, and precisely that lack of oversight, regulation etc.. to keep even Privatised public services under control via strict UK ownership rules.. which makes it obvious to me that this is not really Friedman/Monetarism. That ideology is simply a convenient 'cloak of respectability' on which to hang wholesale theft.
And today's Fantasy Economics bollocks from Hunt, simply confirms that the ruling bastards have not finished yet, and still see sufficient Asset Stealing opportunity in the future, principally I suspect in and around the NHS, to keep them interested in 'Government', for the forseeable.
 
Mullardman said:
As I said.. we are very close and in danger of descending into semantics. Maybe if I put it this way...

Yes, I know very well what Friedman's Monetarism means. I also understand the fundamentals of Keynsianism. I was at Uni as a very impoverished mature student just after Thatcher came to power and of course the Friedman v Keynes debate was very current. It featured very prominently in discussions surrounding the course 'The History of Economic Thought', which comprised 20% of my first year studies, though, as the name implies, the course was a pretty cursory one, covering economic thought from Plato, via Scholasticism, Feudalism, Bullionism, the rise of Capital(ism), the Marxist response, etc, etc.. to Keynes and Friedman.

So yes, I accept that sadly, the currently predominant ideology is Friedman/Thatcher/Monetarist based. But that's not really the point I'm making...

My point is, put simply, that even if I subscribed to the 'technical' premises and assumptions inherent in Friedman et. al., (which I don't) and even if I believed (which I don't) in say, Privatisation.. It would not follow that it is 'good thing', to achieve privatisation by flogging Children's Homes, Health Care, etc., etc., etc. to offshore interests, foreign govts, etc.,etc.,etc.

It is the fact that so much Privatisation has led to precisely those evils, and precisely that lack of oversight, regulation etc.. to keep even Privatised public services under control via strict UK ownership rules.. which makes it obvious to me that this is not really Friedman/Monetarism. That ideology is simply a convenient 'cloak of respectability' on which to hang wholesale theft.
And today's Fantasy Economics bollocks from Hunt, simply confirms that the ruling bastards have not finished yet, and still see sufficient Asset Stealing opportunity in the future, principally I suspect in and around the NHS, to keep them interested in 'Government', for the forseeable.
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I don’t disagree with any of that.
 
gavreid said:
Another nothing speech from Starmer at London Labour Conference. I'm not sure if he's accepting blame for Labour's racist past here - I doubt it!

https://www.theguardian.com/politic...ur-is-party-of-sound-money-and-public-service
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The labour tactic of constantly attacking Corbyn is just handing a big stick to the Tories. The Tories don’t go in for self inflicted wounds by going on about Truss or May. The Labour Party I has decided to fracture itself.

Also, what is “sound money”? Are Labour proposing price controls?
 
ks.234 said:
The labour tactic of constantly attacking Corbyn is just handing a big stick to the Tories. The Tories don’t go in for self inflicted wounds by going on about Truss or May. The Labour Party I has decided to fracture itself.

Also, what is “sound money”? Are Labour proposing price controls?
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He means that he will continue to allow all of the bungs and loopholes that the City has come to expect.
 
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