Coalition?

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Comment by Rebekah Gronowski on July 14, 2010 at 17:44

Sorry - I meant the "I agree with Nick" group ;(

Comment by Rebekah Gronowski on July 14, 2010 at 17:43

Steve - I believe we have taken a seat in the Mendips, thus blocking any overall control by the opposition party there - I think other seats have been taken too. Take a look at Jennifer's posting on 2nd July in 'I Support Nick Clegg' which will give you the details.

Comment by Andrea Gill on July 2, 2010 at 12:34

@Doug Anderson "we must ensure that the answer does not become the Liberal Party!"

The Liberal Party would be rather confused about that... Did you mean the Liberal Democrats by any chance? ;-)

Comment by Steve T on July 2, 2010 at 10:59

Another interesting question to ask is what is the impact on the poll ratings for us? I think we've gone down and the Tories haven't.

Comment by Anthony Binder on June 29, 2010 at 11:06

The Lib Dem´s had in the manifesto a fully funded budget, one that was very realistic taking the current circumstances in account. I am aware that any assets realised have an impact that of course is limited in time, e.g. fund budget in one or a few years, but the assets actually generate revenue that is not accounted for even if they are not sold off.

The assets also make any credit rating of the UK on the credit market more positive than what the government says.

The underlying growth assumed in order to make the budget realistic is in reality driven by demand, and in the case of the UK essentially in public consumption demand. I see no stimulus of the public demand, and further I see no real stimulus of the industrial investment and B2B demand either.

The stimulus proposed in the manifesto towards green economic development is lacking in this budget

As growth stimulus to the corporate area the budget has a 10.5% increase Capital fund towards SME´s, and a 'green central bank' that is not so far financed at all.

With lower private consumption levels I can´t see the revenues rise as stated in the budget.

I can also see that a 20% rise in the unemployment which is very likely to happen will slow any growth driven by demand.

Also any inflation higher than 2%, we have an inflation more than double that, will increase the cost for inflation pegged spending.

I still think that there is ways to implement a balanced budget, It can actually be done by looking through the Lib Dem manifesto, can´t be that hard.

I also anticipate increased spending in stimuli of the arms trade, and of course this announcement will be made by a Lib Dem MP.

Comment by Liz W on June 29, 2010 at 6:41

Anthony: selling off the bank shareholdings would reduce the deficit for one year, but it would do nothing in future years, so it would just be a sticking-plaster. £155bn is the annual shortfall, not the total debt. Using capital gains to offset a running deficit is a mug's game - unsustainable by definition.

Comment by Doug Anderson on June 28, 2010 at 22:55

Within the comments it is stated 'there is nothing left to pawn' but we are already selling publicly funded assets - HS1 the high speed rail link is being sold for £1.5 billion and I have no doubt that our partners in the coalition will sell the bank assets at some point to 'further balance the books' when market conditions are suitable. This again will be used to pay for the future give away budget that the tory's will need to ensure the next election does not result in a coalition government.

The attack on the welfare state continues and gathers pace. 'Move people in council houses who do not have jobs to areas where the jobs are' seems to be the idea of the moment. Cut all benefits to 'encourage people back into work'. Where are all these jobs that the tory's seem to think exist? How are companies supposed to become established when no bank is lending and support from regional development agencies and back to work schemes are to be scrapped?

Now I read that the tory idea of having a 'Green Investment Bank' is going to happen and will take over existing organisations remits including the Technolgy Strategy Board, The Carbon Council and several others (WRAP?). The 'bank' will be encouraged to invest and loan money to renewable energy companies but if it is set up like most banks it will be there to make a profit and will be 'risk adverse which with new technologies becomes an oxy-moron? Who supports organisations that are recycling materials?

I acknowledge all of the proposed benefits of the coalition and will even accept that our MP's have tempered this emergency budget. I will even accept that the VAT rise is actually a progressive tax although it will have a major negative impact on inflation and investment that could stunt growth.

My concerns remain the same, we will be 'assumed' by the tory party and become an 'irrelevance', there to accept blame for all things left of centre and left by the labour government and when and if the good news comes it will be tory ministers that will deliver the news and benefit from the surge of public gratitude and ensure that the next election delivers them the result they wanted this time. Remember David Cameron's statement when asked about his favourite joke - his answer was Nick Clegg - we must ensure that the answer does not become the Liberal Party!

Comment by Anthony Binder on June 28, 2010 at 19:28

The government holds after the 'bank bail out scheme' shares in Lloyds TSB and RBS at a total market value of today at about £54.7 bln (27.6bln shares LLOY, 90.6bln shares RBS so you all can figure out the assets yourself), the realisation of these assets would of course significantly change the budget deficit (estimated today at about £ 155 bln.

If by any chance the country would see a GDP growth the value of these shares would of course increase and therefore decrease the budget deficit. Any creditors calculate the credibility of a governments marketable assets, and so does the OECD and the EU when they rate the UK, it´s only our government that doesn´t account these assets, because it would significantly change the grim picture painted.

As far as I understand no MP were opposed to this recapitalisation of the banks back in November 2008.

The calculations in the budget is also based on an inflation of 2% (really unrealistic), unemployment of 2.5mln (unrealistic) and a growth of 1.3% this year and 2.3% next year (also too optimistic)

So in my views the budget is completely unreal, and the economics used is only a way to argue for tory policies.

Some investment done in the public sector was agreed by Labour and LIb Dem´s in order to keep the unemployment down, in order to stimulate demand, which is the motor of growth.

Lib Dem´s went even further and wanted an investment in infrastructure in order to stimulate growth in 'green economy' something I fully support, but now the growth in this sector is expeted to happen without any investment.

Bear in mind that unemployment only leads to higher public spending and lower public revenue. So I see no economic way that the budget can result in any deficit cuts. Cost cuts yes, but not deficit cuts since the revenues will decrease due to lack of growth because the demand will be low.

To frighten then people about the greek situation and tell everyone that the cuts is necessary and that Labour ruined the economy is just sad. The economy is in a seriously unhealthy state, but not critical, but since we now have shut down all the treatment and sending the patient home with a band aid makes me really worried (maybe we should spell that Band Aid and call for Bob Geldof and Midge Ure to bail us out?)

Comment by Rebekah Gronowski on June 28, 2010 at 19:13

Coalition Politics, whilst not being ideal, are what we have and what we need to deal with in finding a way to move forward. Coalition is about compromise, bargaining, consultation and prioritisation of need for the good of all.

At the moment, from where I am sitting, there is compromise on the part of the Lib Dems, bargaining by both parties and the Lib Dems losing, consultation but the loudest voices getting heard (Conservative ones) and prioritisation in which the priorities which have been laid down are all the wrong ones.

You are right, Ron - we do have to trust our MPs but I don't want to have to stand by and watch them all subsumed by the Conservative MPs. We have seen this before in the Scottish coalition - I am getting a feeling of deja vu already!

Comment by Ron Spencer on June 28, 2010 at 17:25

I think we have to trust our people at the sharp end in Westminster but hold them to account at conference.
As to the economic problems we face, it seems to me that the country, under Labour, had been financing its spending via the pawnbroker the loan-shark and the bookie.
Well, we've run out of things to pawn and the loan-sharks and bookies want their debts paid 'or else'.

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