The state of the economy?
Discussion
So we've had a credit crunch followed by a banking crisis, followed by a severe recession. A million or so people in the UK lost their jobs. Many millions more had pay cuts. Millions more had pay freezes. House prices crashed something like 20%. We briefly entered a period of deflation. Major corporates names went bust - Woolworths, Zavvi, Lehman Bros.
2008-09 was horrible.
In comparison we now have upcoming austerity measures and the potential problems of sovereign debt in Europe and slugglish growth in world trade. It can't be as bad - can it?
Why then, do the media (and I am not just talking about the Guardian and BBC) refer as if the upcoming austerity cuts will send us into freefall?
Lots of talk about how job fears will dent consumer confidence.
But hang on - RBS and Lloyds are back in the black. HSBC, Barclays, Vodafone, BT, Tesco - profits are up. Hays recruitment announced massive revenue growth on the back of very busy recruitment.
Is it just because public sector types are more vocal about their potential job losses than the private sector? Or is the media just biased?
2008-09 was horrible.
In comparison we now have upcoming austerity measures and the potential problems of sovereign debt in Europe and slugglish growth in world trade. It can't be as bad - can it?
Why then, do the media (and I am not just talking about the Guardian and BBC) refer as if the upcoming austerity cuts will send us into freefall?
Lots of talk about how job fears will dent consumer confidence.
But hang on - RBS and Lloyds are back in the black. HSBC, Barclays, Vodafone, BT, Tesco - profits are up. Hays recruitment announced massive revenue growth on the back of very busy recruitment.
Is it just because public sector types are more vocal about their potential job losses than the private sector? Or is the media just biased?
Zavvi went bust?Continued spending by all the massively overpaid public-sector workers (like me) undoubtedly contributed to reducing the depth of the recession.
Start getting rid of us, in the hundreds of thousands being suggested, and that's a massive chunk of spending that will disappear from the economy. And no, there is no way the private sector will be able to expand and employ us all because a) The money saved on our wages is going straight into paying off the national debt and b) We're all useless and incapable of doing 'real' work anyway.
I can't understand why anyone would think we are heading for anything other than a seriously difficult few years. And I remain baffled by those in the private sector who express glee and joy at public sector job cuts. Necessary they may be, but they are going to bite everyone.
Start getting rid of us, in the hundreds of thousands being suggested, and that's a massive chunk of spending that will disappear from the economy. And no, there is no way the private sector will be able to expand and employ us all because a) The money saved on our wages is going straight into paying off the national debt and b) We're all useless and incapable of doing 'real' work anyway.
I can't understand why anyone would think we are heading for anything other than a seriously difficult few years. And I remain baffled by those in the private sector who express glee and joy at public sector job cuts. Necessary they may be, but they are going to bite everyone.
OK it seems everyone has so far missed the point I so badly made!
I am not saying things are rosy. I am simply wondering why all the media attention is on how bad things are going to get in the next few months/years, when surely the really bad stuff has already happened.
It's almost as if they don't consider a private sector recession as that bad, but a public sector cull is somehow worse.
Remember 2001? If it wasn't for public spending we would have had an official recession. Many in the private sector suffered badly but this wasn't particularly noticed by the media or the public in general. If some diversity workers get made redundant though, suddenly we have a depression. Wierd.
I am not saying things are rosy. I am simply wondering why all the media attention is on how bad things are going to get in the next few months/years, when surely the really bad stuff has already happened.
It's almost as if they don't consider a private sector recession as that bad, but a public sector cull is somehow worse.
Remember 2001? If it wasn't for public spending we would have had an official recession. Many in the private sector suffered badly but this wasn't particularly noticed by the media or the public in general. If some diversity workers get made redundant though, suddenly we have a depression. Wierd.
oyster said:
I am not saying things are rosy. I am simply wondering why all the media attention is on how bad things are going to get in the next few months/years, when surely the really bad stuff has already happened.
It's almost as if they don't consider a private sector recession as that bad, but a public sector cull is somehow worse.
I don't think I made my point clearly either. It's almost as if they don't consider a private sector recession as that bad, but a public sector cull is somehow worse.
What I was attempting to say was that in my view (and I guess, much of the press) the really bad stuff hasn't yet happened. Why? Because during the recession we've just had, public sector spending kept going, and much of that money ended up in our shops and businesses. Of course there were many casualties, but there were fewer than there would have been without the public sector carrying on spending. Next time, that won't be the case.
Basically, I think a 'public sector cull' on the scale being proposed will result in another 'private sector recession'. I don't think they are as separable as you do.
I dont see how a more efficient allocation of resources can make things worse.
Money is a claim on labour, inefficient allocation of that labour is wrong.
For too many years this has been the case.
So dumping inefficiency and reallocating resources more effectively has to be good in the long run.
To bad if there is some pain in the short term. The savers might get to pick up some bargains for a change instead of seeing all their savings wasted on bailing out failed resource allocation recipients.
Money is a claim on labour, inefficient allocation of that labour is wrong.
For too many years this has been the case.
So dumping inefficiency and reallocating resources more effectively has to be good in the long run.
To bad if there is some pain in the short term. The savers might get to pick up some bargains for a change instead of seeing all their savings wasted on bailing out failed resource allocation recipients.
Ten Ninety said:
Continued spending by all the massively overpaid public-sector workers (like me) undoubtedly contributed to reducing the depth of the recession.
Start getting rid of us, in the hundreds of thousands being suggested, and that's a massive chunk of spending that will disappear from the economy. And no, there is no way the private sector will be able to expand and employ us all because a) The money saved on our wages is going straight into paying off the national debt and b) We're all useless and incapable of doing 'real' work anyway.
I can't understand why anyone would think we are heading for anything other than a seriously difficult few years. And I remain baffled by those in the private sector who express glee and joy at public sector job cuts. Necessary they may be, but they are going to bite everyone.
Can you explain where the money to pay for public sector wages comes from please?Start getting rid of us, in the hundreds of thousands being suggested, and that's a massive chunk of spending that will disappear from the economy. And no, there is no way the private sector will be able to expand and employ us all because a) The money saved on our wages is going straight into paying off the national debt and b) We're all useless and incapable of doing 'real' work anyway.
I can't understand why anyone would think we are heading for anything other than a seriously difficult few years. And I remain baffled by those in the private sector who express glee and joy at public sector job cuts. Necessary they may be, but they are going to bite everyone.
NoelWatson said:
Can you explain where the money to pay for public sector wages comes from please?
Yes, although fbrs has kindly done it for me.fbrs said:
oh dear. where does the money come from for this spending? i'll give you a clue; tax, more government borrowing, or quantitative easing all of which, in the end, comes from the private sector.
Of course it does. But that's irrelevant because for the next few years, the money saved from cutting public sector spending is not going to go back to you wealth-generating chaps in the private sector is it? It's all going to disappear in the black hole that is our multi-billion pound debt.
Of course, we have to scale back the public sector - it's completely unsustainable and a massive drain on the economy. Nobody could suggest otherwise. And for the sake of the long term, the cuts are necessary. But if you can't see that in the next 2-3 years there is going to be a whole world of pain for many, many hard working folk in the private sector, as a direct result of public sector cuts then I would respectfully suggest that you're deluding yourself.
As our illustrious leader is so fond of saying - "We're all in this together".
Ten Ninety said:
But if you can't see that in the next 2-3 years there is going to be a whole world of pain for many, many hard working folk in the private sector, as a direct result of public sector cuts then I would respectfully suggest that you're deluding yourself.
Please explain how cuts in the public sector will cause such pain for those in the private sector, because I honestly don't get it.NoelWatson said:
And that's under 'day long observation' so we can guess what unobserved everyday real world productivity is.Ten Ninety said:
Continued spending by all the massively overpaid public-sector workers (like me) undoubtedly contributed to reducing the depth of the recession.
Start getting rid of us, in the hundreds of thousands being suggested, and that's a massive chunk of spending that will disappear from the economy. And no, there is no way the private sector will be able to expand and employ us all because a) The money saved on our wages is going straight into paying off the national debt and b) We're all useless and incapable of doing 'real' work anyway.
I can't understand why anyone would think we are heading for anything other than a seriously difficult few years. And I remain baffled by those in the private sector who express glee and joy at public sector job cuts. Necessary they may be, but they are going to bite everyone.
I understand your point here and it is valid. But what you are forgetting is that over the last 2 years the private sector which reacted immediately to the recession cut back numbers and reduced pay, not just stopped taking year % increases, but actually took pay cuts in many cases.Start getting rid of us, in the hundreds of thousands being suggested, and that's a massive chunk of spending that will disappear from the economy. And no, there is no way the private sector will be able to expand and employ us all because a) The money saved on our wages is going straight into paying off the national debt and b) We're all useless and incapable of doing 'real' work anyway.
I can't understand why anyone would think we are heading for anything other than a seriously difficult few years. And I remain baffled by those in the private sector who express glee and joy at public sector job cuts. Necessary they may be, but they are going to bite everyone.
So whilst the public sector carried on as though nothing was happening the private sector tightened it's belt. Now it's getting to the public sector, the private sector is coming though it.
So I'm not sure that the drop in public employees spending will make so much difference compared to the reduced private sector employee spending of the last 2 years.
Most private companies that weathered the storm are now returning to normal and the increasing private spending will offset the reduced public spending.
About time too
turbobloke said:
NoelWatson said:
And that's under 'day long observation' so we can guess what unobserved everyday real world productivity is.Ask most council employees whether they prefer an 'in house' service or the private sector and they will mainly prefer 'in house'
Private sector = maximise profit, do as little hours on the job as possible
Public sector = You have the same amount of hours/cost that the private sector tendered on, do what you need to do and carry out the job in the timeframe given.
Do you see the difference?
jules_s said:
turbobloke said:
NoelWatson said:
And that's under 'day long observation' so we can guess what unobserved everyday real world productivity is.Ask most council employees whether they prefer an 'in house' service or the private sector and they will mainly prefer 'in house'
Private sector = maximise profit, do as little hours on the job as possible
Public sector = You have the same amount of hours/cost that the private sector tendered on, do what you need to do and carry out the job in the timeframe given.
Do you see the difference?
It's not about whether there are any very capable and hard-working employees in the public sector or whether there are any underwhelming slackers in the private sector. It's about the fact that most of the underwhelming slackers in the private sector will be fired, whereas most of their equivalents in the public sector will stay there until they're virtually unsackable on either a cost or custom and practice basis, or both.
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