What do Labour mean by a "growth strategy"?
Discussion
turbobloke said:
I won't be changing my view and I guess you won't either so we may have to agree to disagree 
Probably. I don't see any benefit in blanket incentives they never deliver what you need. My view is that if we want small firms that can expand then we target specifically those and in a way which only delivers the reward if they do what you want and grow and employ more. Wholesale discounts to everyone is too random an approach and doesn't work.
el stovey said:
1)The economy shrank 0.3 per cent in the final quarter of 2011 and another 0.2 per cent in the first quarter of 2012.
2)We're in a double-dip recession
3)The situation is unlikely to improve any time soon.
The key though is which businesses are falling and which are rising. 2)We're in a double-dip recession
3)The situation is unlikely to improve any time soon.
In practice we are in the middle of rebasing our model and many firms aren't solvent in the new model.
If we are cutting red tape and reducing the amount paid willy nilly in welfare etc then many firms which derive their revenue from the kind of spending we would call feckless on PH will be getting screwed.
Other firms which are exporting or just selling into a different market place will be doing well.
There is still enormous amounts of money in the hands of the UK population but where it has contracted is with those who were living off money they hadn't earned, whether debt or handouts.
Likewise firms selling into EU may be taking a hit but other firms selling into the BRICS are doing well.
It's important to recognise that part of any recession is an evolution.
cardigankid said:
Before we all go on a witch hunt, can I point out that Retail is not intrinsically bad. It drives technology among other things. Would you prefer to have techniology driven by something less tacky? A war for example? Then we can all benefit from the latest and wizziest developments in poison gas.
What was wrong was that we were all borrowing to borrow goods that we were not producing, a direct result of the Brown philosophy and that of the governments, including the Tories, who preceded them. Sort that. Keep shopping, particularly, I would say, for cars.
Buying goods that aren't made here isn't as big an issue as it looks. If you take clothing something that is sold for £20 in the shop probably sees less than £2 leaving to China in the grand scheme. What was wrong was that we were all borrowing to borrow goods that we were not producing, a direct result of the Brown philosophy and that of the governments, including the Tories, who preceded them. Sort that. Keep shopping, particularly, I would say, for cars.
As you say, the real problem was a false spending level that carried on for so long that myriad shops opened to cater for the demand. That demand has gone. The supply side must now contract.
As supply contracts then you would hope lease costs would fall as supply rose and then new businesses targeting the new economy requirements will grow.
One problem though is that so much commercial property is now linked to yielding bonds that the process of rebasing in this area is retarded.
But the simple reality at the moment is that there are too many shops chasing too low demand.
We could increase demand by growing non retail businesses to employ and pay more or the govt could employ and pay more. The latter needing even more debt as we saved nothing in the good times. As such we really are solely reliant on building private enterprise.
Two years after the Election and at long last the Government is on the brink of introducing a raft of growth policies. To imagine, as the Government did, that simple austerity plans would see off the overspend and private sector pick up the public sector job losses, lamentable.
Cameron siding up with Hollande shows the desperation now for a urgent injection of growth policies across Europe.
An energy policy resembling a steaming cow pat, unemployment numbers being manipulated alongside so called apprenticeships which for the most part offer no job at the end. Infrastructure unable to cope with demand and taxpayer heavy subsidies to the rail network now being extended to the energy companies.
Thanks politicians the last forty years have been good for you and now we pay the price for those short term re-elect me policies.
And breathe
Cameron siding up with Hollande shows the desperation now for a urgent injection of growth policies across Europe.
An energy policy resembling a steaming cow pat, unemployment numbers being manipulated alongside so called apprenticeships which for the most part offer no job at the end. Infrastructure unable to cope with demand and taxpayer heavy subsidies to the rail network now being extended to the energy companies.
Thanks politicians the last forty years have been good for you and now we pay the price for those short term re-elect me policies.
And breathe
DonkeyApple said:
turbobloke said:
I won't be changing my view and I guess you won't either so we may have to agree to disagree
Probably. I don't see any benefit in blanket incentives they never deliver what you need. Business success is a risky businesses and government must accept some degree of risk in terms of any strategy they adopt to support growth. The suggested menu has a hope of delivering growth, as opposed (for example) to the greater risk attached to inflating the public sector further when it needs more pruning.
turbobloke said:
But they do...the objection seems to be some lack of perfection in targeting. As a parallel, business start-up support as per the last Conservative administration, could be seen as 'not working' because some start-up businesses didn't survive, but it worked precisely because many others did survive and prosper.
Business success is a risky businesses and government must accept some degree of risk in terms of any strategy they adopt to support growth. The suggested menu has a hope of delivering growth, as opposed (for example) to the greater risk attached to inflating the public sector further when it needs more pruning.
I'm not in disagreement. Business success is a risky businesses and government must accept some degree of risk in terms of any strategy they adopt to support growth. The suggested menu has a hope of delivering growth, as opposed (for example) to the greater risk attached to inflating the public sector further when it needs more pruning.
Just don't consider CT of relevance to start ups and also see no need in blanket rewards.
Certainly if the govt wants to stimulate false growth they should cut taxes to workers not increase payments to benefit recipients. But the money isn't there for either to be done sensibly.
The govt were hoping private enterprise would have done better and I do agree with them that the absolute mess of Europe and its total failure to address their own problems has seriously impacted our commercial revenues. This dip back in can be laid firmly on the doorstep of the EU mess.
But the real key is to cut admin and costs for all small firms and start ups but only use tax incentives for those that can genuinely deliver on growth and employment and then only once they have done so.
DonkeyApple said:
turbobloke said:
But they do...the objection seems to be some lack of perfection in targeting. As a parallel, business start-up support as per the last Conservative administration, could be seen as 'not working' because some start-up businesses didn't survive, but it worked precisely because many others did survive and prosper.
Business success is a risky businesses and government must accept some degree of risk in terms of any strategy they adopt to support growth. The suggested menu has a hope of delivering growth, as opposed (for example) to the greater risk attached to inflating the public sector further when it needs more pruning.
I'm not in disagreement. Business success is a risky businesses and government must accept some degree of risk in terms of any strategy they adopt to support growth. The suggested menu has a hope of delivering growth, as opposed (for example) to the greater risk attached to inflating the public sector further when it needs more pruning.
Just don't consider CT of relevance to start ups and also see no need in blanket rewards.
Cutting corptax shouldn't be seen as a blanket a reward in my view but an incentive for new start-ups to proceed and a stimulus to further growth in successful businesses. Fortunately the Treasury seem to agree, for now.
turbobloke said:
We're back to agreeing, then moving on to agreeing to disagree
Cutting corptax shouldn't be seen as a blanket a reward in my view but an incentive for new start-ups to proceed and a stimulus to further growth in successful businesses. Fortunately the Treasury seem to agree, for now.
Cutting corptax shouldn't be seen as a blanket a reward in my view but an incentive for new start-ups to proceed and a stimulus to further growth in successful businesses. Fortunately the Treasury seem to agree, for now.
But a start up doesn't pay CT so cutting CT doesn't help.
There's already a lower rate for smaller companies.
But, we want to target very specific types of companies, mainly labour intensive so the best incentive is to reduce tax based on PAYE head count on minimum wage of higher full employment.
In regards to incentivising start ups I just dont see tax as a relevance. I would think that finance and red tape are the largest hurdles by a mile.
DonkeyApple said:
turbobloke said:
We're back to agreeing, then moving on to agreeing to disagree
Cutting corptax shouldn't be seen as a blanket a reward in my view but an incentive for new start-ups to proceed and a stimulus to further growth in successful businesses. Fortunately the Treasury seem to agree, for now.
Cutting corptax shouldn't be seen as a blanket a reward in my view but an incentive for new start-ups to proceed and a stimulus to further growth in successful businesses. Fortunately the Treasury seem to agree, for now.
But a start up doesn't pay CT so cutting CT doesn't help.
and with respect, it does help:- by way of incentive to those thinking of starting up a ltd co business
- by supporting growth in those ltd co start-ups that are profitable from the off
By no means all businesses manage to make a loss in the first year(s) of trading despite the best efforts of the owners
el stovey said:
turbobloke said:
el stovey said:
Derek Chevalier said:
What makes you think it isn't working?
1)The economy shrank 0.3 per cent in the final quarter of 2011 and another 0.2 per cent in the first quarter of 2012.2)We're in a double-dip recession
3)The situation is unlikely to improve any time soon.
Being in recession initially was certainly due to the previous government but a double dip recession is a result of this government's economic policy. For the UK, the recession is also deeper because of decades of concentration on financial services and an economy driven on debt (started with deregulation by Thatcher and continued by New Labour) and a lack of diversity in the UK economy.
I'm not basing my view on political ideology, I voted Conservative in the last election but at some point the government has to stop blaming Labour for every thing that's wrong. To me the governments slavish concentration on austerity is resulting in a lack of public confidence and spending, leaving us faced with the very real prospect of stagnation and inflation which will deepen the problem considerably.
turbobloke said:
Hmm. As I posted yesterday and with respect, it does help:
- by way of incentive to those thinking of starting up a ltd co business
- by supporting growth in those ltd co start-ups that are profitable from the off
By no means all businesses manage to make a loss in the first year(s) of trading despite the best efforts of the owners
If someone wants to start a business paying 20% or just 15% tax on profits isnt going to help or hinder. and with respect, it does help:- by way of incentive to those thinking of starting up a ltd co business
- by supporting growth in those ltd co start-ups that are profitable from the off
By no means all businesses manage to make a loss in the first year(s) of trading despite the best efforts of the owners
And very few start ups are troubled by CT.
I'm not buying it yet.
Making it easier to start up and to employ people is far smarter and much more powerful.
DonkeyApple said:
Making it easier to start up and to employ people is far smarter and much more powerful.
Ease of start-up...that's a construct with both emotional and practical aspects, and facing low/reducing corptax will help with at least one of those and probably both.Beyond that cut red tape further, stop hiking employer NI and the rest, so yes agreed (again).
turbobloke said:
Ease of start-up...that's a construct with both emotional and practical aspects, and facing low/reducing corptax will help with at least one of those and probably both.
Beyond that cut red tape further, stop hiking employer NI and the rest, so yes agreed (again).
Give all start ups 12 months of zero CT. Beyond that cut red tape further, stop hiking employer NI and the rest, so yes agreed (again).
That's a good incentive to attract loads of people who haven't got what it takes to win.
Plus, 99.9% of them were never going to be liable for the tax.
But can you imagine the mess that would cause and the repercussions?
If someone is so simple as to be suckered in on a discount on something they never had to pay its not likely they are good enough in business to survive whatever happens.
And then why give discounts to people who have proven they can succeed without them?
turbobloke said:
Why zero...just cut for all and aim for better than 4th place in the G20 corptax league tables by 2014
Max out business and entrepreneur relocations here.
Help profitable start-ups and existing employers.
I'm just saying that if someone needs a lower CT to encourage them to start up a business then as the CT from 99.9% of start ups is zero in the first year it doesn't matter whether you set it at 100% or zero. But from a marketing perspective to suck in as many punters as possible you'd set it to zero Max out business and entrepreneur relocations here.
Help profitable start-ups and existing employers.
CT at 20% isn't really stopping business. But it has enough fat in it to offer bespoke discounts to target key companies to deliver desired actions, ie primarily to employ more and expand.
Why give a discount to a firm which can't expand or doesn't want to. Let them be.
Would you give all of your customers a 25% automatically? What purpose would this serve other than to drop your revenues without any specific benefit. You'd want to target your discounts to achieve the growth that you want from the areas you know it is.
Scarily he may get his inspiration from this man ?
Telegraph said:
Britain can’t afford to fall for the charms of the false economics Messiah Paul Krugman
Superstar economist Paul Krugman wants us to change course, but his solutions are simplistic.
http://www.telegraph.co.uk/finance/economics/86478...Superstar economist Paul Krugman wants us to change course, but his solutions are simplistic.
RichardD said:
Scarily he may get his inspiration from this man ?
Two peas out the same pod. Notice how the neo-Keynesians like Balls, Krugman and most of the BoE MPC are always looking for ways to understate inflation. They love inflation because they think it can be used to fool wage earners into taking real terms pay cuts in order to sustain employment and they despise savers, just like Keynes did. They wouldn't recognise sound money if they were hit in the face with a gold bar. Telegraph said:
Britain can’t afford to fall for the charms of the false economics Messiah Paul Krugman
Superstar economist Paul Krugman wants us to change course, but his solutions are simplistic.
Superstar economist Paul Krugman wants us to change course, but his solutions are simplistic.
If the MPC had any interest in targeting inflation then interest rates would be higher and there would have been much less QE. Instead they talk about output gaps and weak growth and how they need to implement "stimulus". They honestly think QE drives down long term borrowing costs for industry. They are engaging in good old fashioned "demand management" and negative real interest rates - a strategy that gave us that wonderful golden era of the 1970s, falling productivity, stagflation and terylene shirts. If Balls ever gets back into power I suggest you dig out your old kipper ties...
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