Austerity - how long now?

Author
Discussion

crankedup

Original Poster:

25,764 posts

244 months

Monday 27th February 2012
quotequote all
Anyone care to have a stab at predicting just how many years the U.K. will be under the austerity program, assume until deficit is acceptably down at sensible levels. I'm going for 2021 for no other reason then gut instinct.

Odie

4,187 posts

183 months

Monday 27th February 2012
quotequote all
2016 id say

tomw2000

2,508 posts

196 months

Monday 27th February 2012
quotequote all
2019.

but all the figures will be massaged to make it look better before then imo...

P-Jay

10,579 posts

192 months

Monday 27th February 2012
quotequote all
How long it should go on for, and how long it will go on for are two different things I think.

I fancy once the recovery is stronger and more sustainable the political will to continue will fall away and whichever party is in charge will start talking about driving down the deficit through growth.

I would imagine tax cuts will come about 6 months before the next election, and the ConDems will be preaching 'mission accomplished'.

12gauge

1,274 posts

175 months

Monday 27th February 2012
quotequote all
I heard lots of bonds will mature around 2015; that is we will be in the position Greece is in today (our debt position really is no better than theirs). We will have trouble repaying the principal on those, having to sell vast issues of new debt to cover the old ones. That obviously wont happen, so we'll print a trillion of so of new money, the pounds value will plummet.

My guess is the whole house of cards comes crashing down around then. Austerity will be the last thing on peoples minds. Just getting a tin of beans will be most peoples main concern. The public sector wont get their darned pensions, the civil service will start getting paid in Gherkins and Toilet rolls, like the Russian Civil service did in 1998, and it will all be blamed on the tories.

DSM2

3,624 posts

201 months

Monday 27th February 2012
quotequote all
It will go on until we get a government that will stop wasting taxes on public services and the non contributors to the economy, and starts to incentivise those who can make a difference.

I.e. it will go on indefinitely.

Ozzie Osmond

21,189 posts

247 months

Monday 27th February 2012
quotequote all
It will go on until Mr Average gets bored with going around with a long fce and moaning all the time. Once confidence picks up things will move very quickly.

I'll suggest significant improvement in 2013.

ralphrj

3,533 posts

192 months

Monday 27th February 2012
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Despite having the handicap of being a member of the labour party even this bloke understands the reality.

Alan Milburn said:
The truth is this: the era of big public spending is over. Austerity is the new normal. It is not a temporary phenomenon. Fiscal conservatism is the order of the day.

MilnerR

8,273 posts

259 months

Monday 27th February 2012
quotequote all
12gauge said:
I heard lots of bonds will mature around 2015; that is we will be in the position Greece is in today (our debt position really is no better than theirs). We will have trouble repaying the principal on those, having to sell vast issues of new debt to cover the old ones. That obviously wont happen, so we'll print a trillion of so of new money, the pounds value will plummet.

My guess is the whole house of cards comes crashing down around then. Austerity will be the last thing on peoples minds. Just getting a tin of beans will be most peoples main concern. The public sector wont get their darned pensions, the civil service will start getting paid in Gherkins and Toilet rolls, like the Russian Civil service did in 1998, and it will all be blamed on the tories.
The average life of a UK bond is 14 years, according to the Debt Management office the UK government issued £23.7 billion between 2000 and 2002. £23.7 billion sounds like a lot, but the company I work for turns over more than that, to a government it's chicken feed. The above situation is very unlikely to happen, our gilt exposure is mainly long term up to 50 years or more at very low interest rates. The bonds maturing now are for relatively small sums of money as they too are relatively long term (in 1997 all issued government bonds were worth about £250 billion).

In 2015 beans will still be plentiful and we'll all be on PH doom mongering about the next threat to civilisation.

p.s. My estimate is that austerity, in terms of a trimmed public sector and higher taxes, will last until Labour regain power and then the cycle of cock-up followed by repair will continue. So 2015 or 2020. If it's 2020 then Labour will inherit an economy growing it's way out of austerity, they'll ride the growth until about 2030 it'll all go tits up and we'll start again biggrin

nelly1

5,630 posts

232 months

Monday 27th February 2012
quotequote all
crankedup said:
Anyone care to have a stab at predicting just how many years the U.K. will be under the austerity program?
Until Labour gets back into power?

Going on 'popular opinion' (polls), not long then rolleyes

God help us all!

hornet

6,333 posts

251 months

Monday 27th February 2012
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Can't really answer the question without first defining what we mean by "austerity". I was under the impression overall public spending was still increasing, just not as quickly as previously? I'd hardly call that austere.

PugwasHDJ80

7,529 posts

222 months

Monday 27th February 2012
quotequote all
indeed- we haven't had any "austerity" yet- nothing more than a brief tug on the financial reins to try and slow the racing horses of doom.

austerity would be a 40% haircut in spending and even that wouldn't be too bad.

nelly1

5,630 posts

232 months

Monday 27th February 2012
quotequote all
PugwasHDJ80 said:
indeed- we haven't had any "austerity" yet- nothing more than a brief tug on the financial reins to try and slow the racing horses of doom.

austerity would be a 40% haircut in spending and even that wouldn't be too bad.
What he said ^ ^ ^

If you want to see 'austerity', look at Greece at the moment.

[Basil Fawlty]I haven't started yet![/Basil Fawlty]

heppers75

3,135 posts

218 months

Monday 27th February 2012
quotequote all
hornet said:
Can't really answer the question without first defining what we mean by "austerity". I was under the impression overall public spending was still increasing, just not as quickly as previously? I'd hardly call that austere.
^^^ This....

You have to be a very special kind of tit to think that we are enduring anything remotely resembling austerity! It is all but laughable, we need an ENORMOUS cull in spending and mostly in the public sector and social servies area and you know what it will be very very hard when it happens I think the likes of student protest and poll tax riots will seem like convivial dinner disagreements!

When you grant people the ability to feather their nest from the largesse of the public purse they and their followers who were granted such largesse to keep those in power who granted it will revolt and it will be bloody!


Edited by heppers75 on Monday 27th February 21:39

rsv gone!

11,288 posts

242 months

Monday 27th February 2012
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Ever since it started I thought it would be ten years so my guess is 2018 at the earliest. Depressing, as my employers have precious few projects on as it is.

Bing o

15,184 posts

220 months

Monday 27th February 2012
quotequote all
crankedup said:
Anyone care to have a stab at predicting just how many years the U.K. will be under the austerity program, assume until deficit is acceptably down at sensible levels. I'm going for 2021 for no other reason then gut instinct.
As said, it's not started yet. Hopefully the UK economy gets a boost from not being in the Euro and works out that it needs to be a trading partner with the US and Asia, not the EU commies, and they can cut public spending when the private sector starts to grow.

12gauge said:
I heard lots of bonds will mature around 2015; that is we will be in the position Greece is in today (our debt position really is no better than theirs). We will have trouble repaying the principal on those, having to sell vast issues of new debt to cover the old ones. That obviously wont happen, so we'll print a trillion of so of new money, the pounds value will plummet.

My guess is the whole house of cards comes crashing down around then. Austerity will be the last thing on peoples minds. Just getting a tin of beans will be most peoples main concern. The public sector wont get their darned pensions, the civil service will start getting paid in Gherkins and Toilet rolls, like the Russian Civil service did in 1998, and it will all be blamed on the tories.
As long as we repay the interest, and investors think we will repay the interest, then you roll the bond principal into a new tranche. Everyone does this.

don4l

10,058 posts

177 months

Monday 27th February 2012
quotequote all
crankedup said:
Anyone care to have a stab at predicting just how many years the U.K. will be under the austerity program, assume until deficit is acceptably down at sensible levels. I'm going for 2021 for no other reason then gut instinct.
Sounds about right.

We have precedent. Ten years is how long it took after the 1970's Labour government.

Don
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Robsti

12,241 posts

207 months

Monday 27th February 2012
quotequote all
The papers today telling us the country has turned the corner!

Try telling that to the man on the street!

OdramaSwimLaden

1,971 posts

170 months

Monday 27th February 2012
quotequote all
2017. Based ofd the balance of F all.

Bing o

15,184 posts

220 months

Tuesday 28th February 2012
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Robsti said:
The papers today telling us the country has turned the corner!

Try telling that to the man on the street!
Is this the man on the street who is realinsing that 25k a year wage for paper shuffling is not enough to support 2 foreign holidays a year, Sky, a plasma telly and a new car every 3 years?