Tag Archives: economy

Michael Moore

Michael Moore MP’s Westminster Notes

By Michael Moore | Thu 26th July 2012 - 8:55 am

Every week Liberal Democrat Secretary of State for Scotland writes a column for newspapers in his Borders constituency. Here is the latest edition.

Advice surgeries

Last week I began my annual summer advice surgeries during which I will visit around 40 towns and villages across the Borders. These surgeries are a fantastic opportunity for me to hear the concerns of my constituents and discuss how I can support them in my role as MP. I have already held nearly 30 of these surgeries and discussed issues as wide-ranging as wind farms, housing, local roads and jobs.

Residents’ survey

As part of my work as …

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Stephen Tall

As economy shrinks again, Oakeshott calls for Osborne to be moved to make way for “our A team at the treasury”

By Stephen Tall | Wed 25th July 2012 - 1:35 pm

Here’s how The Guardian reports the call by Lord (Matthew) Oakeshott for George Osborne to be moved from Number 11 in the wake of today’s fresh dire news on the economy:

A senior Liberal Democrat peer has called on George Osborne to be sacked as the chancellor continued to insist the government was on the right economic path, despite “disappointing” official

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Ed Davey

Edward Davey MP writes: The greenest government ever – at an affordable price

By Ed Davey | Wed 25th July 2012 - 11:58 am

The announcement I made today of the levels of support for renewable generation for the period 2013-17 will unlock generation and network capital investment worth £20-25 billion between 2013 and 2017 This is the kind of sustainable long run growth and green jobs we need to get the economy moving again. This is further evidence that pursuing green policies can bring real economic benefits. The CBI recognised this  in their report earlier this month stressing the need for a stable climate for green investment. I just wish that some of the critics of green growth policies would pay heed …

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Stephen Tall

What the IMF says about the UK and global economy

By Stephen Tall | Tue 17th July 2012 - 8:25 am

The economic headlines have been dominated by the IMF’s latest forecast, with seemingly grim news: UK economic growth forecasts slashed by worried IMF.

The Guardian contrasts the IMF’s downgraded prospects for UK growth with the more stable picture for other countries:

The IMF said in its latest World Economic Outlook that GDP across the UK – which is currently in recession – will increase by 1.4% in 2013 – a 0.6 percentage point cut from its previous 2% forecast. Only Spain has a bigger downgrade next year after the IMF said it will lose 0.7 percentage points and maintain its

…

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Stephen Tall

Why the Lib Dems cannot end the Coalition. And what we should do to try and rescue it.

By Stephen Tall | Sun 15th July 2012 - 8:55 am

How do we revitalise the Coalition? I realise that for many Lib Dems that’s the very last question on your minds. After a week in which Tory rebel MPs forced the Government to delay a key plank of the Coalition Agreement — House of Lords reform — rather more Lib Dems, and not just the ‘usual suspects’, are turning to the question: how quickly can we be shot of the Tories?

After all, didn’t enough of our MPs walk the plank on the Coalition’s behalf on tuition fees, a policy directly counter to the Lib Dem manifesto? Meanwhile David Cameron cannot even persuade his party to back a reform that’s featured in the last three Tory manifestos. So what’s the purpose of the Coalition any more?

I get the emotional pull of the argument… but it doesn’t persuade me.

Coalition matters more to the Lib Dems than the Tories

The simple truth is that it’s more important for the Lib Dems to try and make this coalition work than it is for the Tories.

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Stephen Tall

Barclays and the Bank of England: BAD rate-rigging and GOOD rate-rigging

By Stephen Tall | Wed 4th July 2012 - 11:15 am

The Barclays rate-rigging scandal has conflated a number of issues — Bob Diamond’s bonus, ‘casino’ banking, failed regulators — making it hard to get behind the media’s shouty headlines to understand the issues which should really concern us. Here’s my brief show-your-working attempt, starting with what Barclays.

What Barclays did right: ‘fess up

LIBOR (London Inter Bank Offered Rate) is the rate at which banks in London lend money to each other for the short-term. It’s used as a proxy measure of market confidence in individual banks, as well as a benchmark for setting mortgage interest rates.

Barclays has admitted filing misleading …

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David Thorpe

Opinion: More QE is not the solution to Britain’s economic challenges

By David Thorpe | Mon 25th June 2012 - 12:23 pm

With the predictability of a partner changing ‘our’ plans at the last minute, the announcement that UK inflation has fallen to its lowest level for two and a half years has been greeted with calls for more Quantitative Easing (QE) to stimulate growth.

Much of the media presentation of the facts of this latest inflation data has focused on the fall being a ‘surprise’. In reality most of the drop was predictable enough, as the article I link to above states, the VAT increase in 2011 fell off the index for the first time in May, while the situation in Iran has stabilised, causing oil prices to fall.

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Stephen Tall

David Laws: let’s cut taxes and spending. For once, I’m unconvinced. Here’s why…

By Stephen Tall | Sun 24th June 2012 - 2:45 pm

David Laws has earned himself a generous write-up in today’s Telegraph, with the paper which triggered his resignation from the cabinet two years ago hailing his ‘radical vision of a liberal state’, and lamenting with crocodile tears that his downfall was ‘a great loss to the Cabinet’.

The cause is an interview David has given to the paper in which he makes the case for further public spending cuts and lower taxes — a case he has outlined in greater depth in an article in the current Institute of Economic Affairs journal, highlighted last week on LibDemVoice. Here’s …

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Nick T

A longer read for the weekend: Baroness Kramer on how to kick-start economic growth

By Nick T | Sun 24th June 2012 - 9:45 am

Earlier this week, Baroness (Susan) Kramer moved a debate in the House of Lords on UK economic growth. Her speech covered the  background to the UK’s current economic position as well as a number of suggestions of what the government can do to encourage growth. Below is a slightly edited version of the speech.

In 2010 the coalition inherited a badly damaged economy. The previous Government had built their boom on the back of tax revenues pumped up by false profits from the banks – …

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David Freeborn

Three more myths about the UK economy

By David Freeborn | Fri 22nd June 2012 - 2:21 pm

A few days ago, Stephen Tall posted his Five Myths About the UK Economy. But in fact understanding what is really going on in the economy is much harder than it first looks. One thing he was definitely right about was that the economy is the big issue and trying to get behind the political rhetoric to discover the economic reality is surprisingly tricky. I decided to post my own three myths about the UK economy.

Myth 1: Cuts aren’t really taking place

The latest fashion for conservative commentators is to deny that real cuts are even taking place. This government, …

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Mark Pack

Can you tell the heroes from the villains in the sub-prime mortgage disaster?

By Mark Pack | Thu 21st June 2012 - 10:25 am

Michael Lewis’s highly readable account of the collapse of the US sub-prime mortgage market and the worldwide financial crisis it triggered focuses on a small number of characters. People with iconoclastic views determined not to be constrained by the old conventional rules. People who created new financial investments. People who put money into places their investors did not really understand on a good day and did not even know what had been done with their money on a bad day. People who made huge profits …

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Mark Pack

Vince Cable on “one of the great acts of economic vandalism in modern times”

By Mark Pack | Tue 19th June 2012 - 10:25 am

Yesterday Vince Cable gave a sweeping speech about the current state of the economy, lessons from the 1930s and the way forward.

The parallels with the 1930s are in some ways obvious, but as Cable pointed out there are important differences. In particular, in the 1930s there was no similar financial crash in Britain to mirror what happened this time. However, in another major respect this time round looks somewhat better than the 1930s as unemployment has not soared in a similar way, helped by the double-edged flexibility of wages. This time round, real wages have suffered, spreading the pain more widely but keeping more people in work. 

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Mark Pack

The New Depression: Richard Duncan’s prognosis of our economic ills and the answer to them

By Mark Pack | Mon 18th June 2012 - 1:54 pm

A slight change from the usual in my day job at MHP Communications has come courtesy of our client Richard Duncan and his new book, The New Depression, which is primarily about the US but with lessons that are very applicable to the UK.

In a nutshell, his case is half-Austrian. Or indeed half-Keynesian. That is because whilst Duncan’s diagnosis of the current economic ills is very much in the Austrian school of economics, with its emphasis on the role of credit, his prescription for fixing the economy is large-scale borrowing to fund infrastructure work, all of which sounds rather Keynesian.

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Stephen Tall

The 5 myths about the UK economy which it suits everyone to perpetuate

By Stephen Tall | Mon 18th June 2012 - 8:11 am

The economy is the big issue: it was at the last general election, it has dominated and will dominate this parliament, and it will be the big issue at the 2015 general election. Yet trying to get behind the political rhetoric to discover the economic reality is surprisingly tricky. The purpose of this post is to look at what I see as the top five myths currently being perpetuated about the economy, and to explain why I think our current debate is misleading the public and diverting us from finding proper answers.

Myth 1: UK public spending is reducing

So keen has been the Coalition and Labour (for their own different reasons) to talk up the extent of the Government’s spending cuts that the reality has been forgotten. Public spending is going up year-on-year under the Coalition, rising from £690bn in 2010-11 to £744bn (+8%) by 2014-15. If we allow for inflation, there will be a modest reduction: from £690bn to £668bn (-3%) by 2014-15.

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Stephen Tall

LDV poll: More than half Lib Dem members back ‘new approach’ to boost economic growth

By Stephen Tall | Tue 12th June 2012 - 3:05 pm

Lib Dem Voice has polled our members-only forum to discover what Lib Dem members think of various political issues, the Coalition, and the performance of key party figures. Some 560 party members responded, and we’re publishing the full results.

54% of Lib Dems back ‘new approach’; but 27% say ‘stick with Plan A’

LDV asked: Thinking about the government’s economic policies, which of the following best reflects your view?

    27% – Borrowing more at a time when we already owe so much will simply make matters worse, as the country will have to pay back even more money in the longer term. We have

…

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Paul Reynolds

Opinion: ‘Economic growth you can believe in’ – towards The British Growth Model.

By Paul Reynolds | Mon 11th June 2012 - 2:23 pm

Economic growth still eludes the Coalition. The development of a convincing analysis and programme for (fiscally sustainable) growth is essential for the second half of the Coalition’s life up to 2015. The Lib Dems must take a lead role in developing it.

Before the economic crisis started in 2007 the signs of ‘systemic financial sector failure’ were all around us. Few spotted them, however. Several simplistic economic tenets have since been jettisoned, as politicians have learned about the economic concept of ‘systemic financial failure’.

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Mark Pack

Government’s search for an alternative to PFI takes another twist with growth bonds

By Mark Pack | Thu 7th June 2012 - 7:55 am

Labour’s PFI and PPP schemes turned out badly in so many ways, it is easy to forget quite why they were so popular to begin with, both with politicians very much of the central government public spending school (e.g. John Prescott) and also with senior public sector managers wanting to get funding for their areas (e.g. at Transport for London).

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Bill le Breton

Opinion: It’s time for a change in monetary policy

By Bill le Breton | Wed 30th May 2012 - 8:55 am

A few years ago my son got a clock for Christmas. It functions anti-clockwise. One o’clock is on the left of twelve. Five to one is really five past one. Are you with me?

The thing is, you have to change completely the way you read and interpret the data on the clock face.

The Coalition leadership is proud of its management of the economy because it sees the interest rates on gilts historically low and continuing to fall. It reads this as a sign that ‘the markets’ have confidence in its stewardship of UK plc.

But suppose they are reading the clock …

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David Thorpe

Opinion: You can’t have ‘growth’ without ‘austerity’

By David Thorpe | Mon 28th May 2012 - 12:54 pm

Amid the current maelstrom of gossip, speculation and forecasting concerning the British economy, a number of myths have developed.

Principal among them is that the coalition’s economic plans for this parliament contained ‘only’ cuts, with no concern for achieving growth.

The issue of whether fiscal consolidation itself can be a driver of growth is one I aim to address further below, but first I want to debunk that myth.

The economic plans, outlined by the coalition in 2010, made clear that the first half of the parliament would contain the bulk of the …

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Prateek Buch

Clegg’s economic gear shift must be driven by Plan C

By Prateek Buch | Sun 27th May 2012 - 8:45 am

With the UK’s double-dip recession biting harder than previously thought, growing unease at the economy’s failure to recover appears to have elicited something of a change of emphasis at the heart of government. If Nick Clegg’s Financial Times interview (£) signifies a genuine change of direction in economic policy, and it would be welcome if so, we should ask in which direction we’re now facing. The Social Liberal Forum recently published Plan C, our approach to achieving a fair, sustainable economy, so it pays to benchmark Clegg’s call to “shift up a gear” against the values

…

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Stephen Tall

Clegg calls for Coalition to “shift up a gear” on the economy

By Stephen Tall | Fri 25th May 2012 - 7:45 am

Nick Clegg has said the Coalition Government’s economic policy needs to “shift up a gear”, following news yesterday that the UK economy shrank by 0.3% in the first three months of the year, down on the initial estimate from the Office for National Statistics (ONS) showing a contraction of 0.2%. Here’s Nick speaking on BBC2’s Newsnight last night:

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Caron Lindsay

Nick Clegg: Europe’s future is our future

By Caron Lindsay | Thu 24th May 2012 - 7:28 pm

Nick Clegg has been in Berlin today, along with Vince Cable. to meet with German ministers and launch the Queen Elizabeth Prize for Engineering, a £1 million reward for an invention that’s changed the world and benefitted humanity.

He took the opportunity to talk about the economic crisis engulfing Europe, making the point that Europe has to work together to sort it. There were no diplomatic niceties in his language as he criticised the failure to find a solution so far:

…our response to this brewing crisis has been woefully fragmented. We have failed on a number of fronts. We have

…

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Lev Eakins

Opinion: The government is in real trouble and needs a new chancellor

By Lev Eakins | Mon 21st May 2012 - 10:24 am

In the last two months, the government has been presented with four major problems:

1. The Economy – It’s not growing, despite good signs in manufacturing and a recent drop in unemployment, we’re back in recession and could even face another almighty shock if the Euro crisis deepens.

2. Ministers mucking things up – May, Hunt and Osborne have provided the government with a fatal combination of not getting the basics right (Abu Qatada and airport queues), the smell of sleaze (Murdoch) and the fallout from …

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Nick T

“We are not planning for a Greek exit” – Verhofstadt

By Nick T | Thu 17th May 2012 - 2:56 pm

Guy Verhofstadt, the former Belgian prime minister and current leader of the liberal grouping in the European Parliament, has rejected talk of Greece leaving the Eurozone. Interviewed on the Today programme yesterday he said such speculation was aimed more at influencing public opinion in Greece than it was a prediction of the likely outcome of the current crisis.

Verhofstadt warned that the EU is unprepared for the contagion that would result from a Greek Euro exit, saying:

There is no real firewall around the other economies of Europe, we only have a few fire extinguishers.

You can hear the full interview – including …

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Bill le Breton

Opinion: Austerity and defying the Laws of gravity

By Bill le Breton | Wed 9th May 2012 - 10:58 am

“It’s ideology, stupid.” – a subtext to the Queen’s Speech

On Five Live a bond trader says that austerity isn’t working and the government should be more expansionary. In Wake Up to Money a fund manger says that austerity has been overdone and it’s time for countries like Germany and Britain to borrow more.

Yet on Tuesday’s Today programme, David Laws continued to advocate austerity.

It is more and more apparent that ‘economics’ is being used to serve the ideology of a smaller State, damning the idea that the State should have different responsibilities at different times, especially when the private sector is …

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Michael Moore

Michael Moore MP’s Westminster Notes

By Michael Moore | Wed 2nd May 2012 - 4:55 pm

Liberal Democrat Secretary of State for Scotland writes a regular column for newspapers in his constituency. Here’s this week’s edition.

Scotland Bill

 Last week the Scotland Bill completed its passage through the House of Commons and received Royal Assent today (1st May). As a Liberal Democrat I have always supported devolution and Home Rule and as Secretary of State for Scotland I am proud to have piloted this Bill through Westminster to deepen devolution even further. Despite their initial opposition, I am pleased that the SNP have also come round to supporting the Bill which will bring about the biggest ever transfer …

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Mark Pack

Nick Clegg trashes Liam Fox’s economic policy demands

By Mark Pack | Wed 2nd May 2012 - 9:55 am

During yesterday’s Radio 4 interview with Nick Clegg there was a feisty exchange over why so much time in the interview was being taken up with the details of when and to who Jeremy Hunt should next answer questions to about his conduct, rather than issues such as the state of the economy.

Certainly the media loves investigatory process stories. Not only the Clegg interview but the subsequent coverage of it neglected the economy, even though Clegg had some choice words to say about former minister Liam Fox:

Martha Kearney: Liam Fox recently accused the Liberal Democrats of being a brake on

…

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Simon Holbrook

Opinion: Vince for No.11 – for growth and investment

By Simon Holbrook | Mon 30th April 2012 - 11:54 am

Coming after several weeks of self-inflicted damage, the news that the UK economy has gone back into recession risks further undermining public confidence in the Government’s ability to deal with the problems the country faces.

Nick Clegg says the principles of the coalition’s economic strategy remain sound – repairing the public finances, reforming the financial system and rebalancing the economy – and I agree. The problem is that we are only making progress on the first one of these …

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Stephen Tall

Nick Clegg on the double-dip recession: “our answers are the right ones to repair the damage done”

By Stephen Tall | Wed 25th April 2012 - 1:45 pm

Nick Clegg spoke this morning to the Institute of Directors, shortly after the announcement that the Office of National Statistics estimates that the economy contracted by 0.2% in the first three months of 2012 — a second quarter of shrinkage that officially means the UK is once again in recession. Here’s what he had to say:

As you may have heard, the first set of GDP figures for this year have just been released. And so, if I may, I would like to start by addressing what is disappointing news. The ONS’s preliminary estimate for Q1 GDP has

…

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Joe Bourke

Opinion: Getting radical with the money supply

By Joe Bourke | Tue 3rd April 2012 - 1:34 pm

Last week the OECD forecast that Britain was about to experience a double-dip recession, for the first time since 1975. Vince Cable in his Centreforum paper Moving from the financial crisis to sustainable growth asks “How far should monetary policy now be expanded further in the UK to boost demand and head off a period of poor growth?

He goes on to say “There is no possibility for further meaningful interest rate cuts – real short term rates are now minus 4 percent. That means further recourse to quantitative easing.

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  • Tristan Ward
    @ Peter Wrigley "Most of us could live very comfortably even if the government did take, say another 5%-10% of our incomes to repair the public realm" I p...
  • Tristan Ward
    @ Peter Wrigley "Somebody has to tell the truth: that we are not over-taxed, and that Inteligently directed taxation will not impede growth." That is not ...
  • Peter Wrigley
    Thank you Sir Vince for a useful survey of the history of "austerity" and the political difficulty of implementing the simple solution to our present social an...
  • Nonconformistradical
    "Their overall bills may well be high because electric heating is expensive" I live in an (almost) all-electric home. I do have a wood burner stove but I've ...
  • Peter Davies
    Another group for whom this does not work are those in all-electric homes including many poor tenants in blocks of flats. Their overall bills may well be high b...