Autumn Statement

[GeoffF100]

"There's one important chart that wasn't in the autumn statement - and it's a depressing one":

https://news.sky.com/story/the-dire-dis ... t-13013667

If you have a political system where elections are won by lies and false promises, you have a mess. Voters want to be told that there is an easy solution and vote for politicians who tell them that there is. Reality is not like that. A better future means pain now, and that does not win many votes.

[ADrunkenMarcus]

Lots to chew over and it’s pretty grim.

I do like permanent full expensing because we do have an underinvestment problem.

The reduction in national insurance for employees will apply to people all over the UK (Scottish income taxes are different) and it benefits the younger, working population.

Best wishes


Mark

[swill453]

The reduction in national insurance for employees will apply to people all over the UK (Scottish income taxes are different) and it benefits the younger, working population.

The Scottish Government can't change the standard personal allowance of £12,570, it's UK wide. And the major cause of the "fiscal drag" tax burden.

Scott.

[Nimrod103]

The reduction in national insurance for employees will apply to people all over the UK (Scottish income taxes are different) and it benefits the younger, working population.

The Scottish Government can't change the standard personal allowance of £12,570, it's UK wide. And the major cause of the "fiscal drag" tax burden.

Scott.

As a matter of interest, is the SNP Govt going to uprate their tax bands in line with inflation, or will they rely on fiscal drag like the UK Govt? (there are two more Scottish tax bands compared to England, and the higher rate is higher as well).

[swill453]

The Scottish Government can't change the standard personal allowance of £12,570, it's UK wide. And the major cause of the "fiscal drag" tax burden.

As a matter of interest, is the SNP Govt going to uprate their tax bands in line with inflation, or will they rely on fiscal drag like the UK Govt? (there are two more Scottish tax bands compared to England, and the higher rate is higher as well).

You'd have to Google it. I don't know off the top of my head as the only that affects is the personal allowance.

Scott.

[TUK020]

You mean more referendums? Now you're talking my language!

Yep, California holds a referendum (more accurately, a voter proposition or initiative) on most kinds of local tax increases including bond measures and property tax increases. To win they need 50% plus 1 for a general revenue bond, and 2/3rds for a tax for a specific purpose. Some pass and some do not.

Otherwise a tax like property tax can only go up by 2% a year.

Prop 13 is still wildly popular after 45 years. Politicians hate it of course, which is how and why we know it is working well.

Have you read about what is happening on the streets of San Francisco? Not sure I would call that 'working well'

[Lootman]

Yep, California holds a referendum (more accurately, a voter proposition or initiative) on most kinds of local tax increases including bond measures and property tax increases. To win they need 50% plus 1 for a general revenue bond, and 2/3rds for a tax for a specific purpose. Some pass and some do not.

Otherwise a tax like property tax can only go up by 2% a year.

Prop 13 is still wildly popular after 45 years. Politicians hate it of course, which is how and why we know it is working well.

Have you read about what is happening on the streets of San Francisco? Not sure I would call that 'working well'

If you are referring there to the homeless encampments on the city streets, then I can construct an argument that that is the result not of too little spending by the city, but rather of too much spending.

San Francisco spends about $200 million a year on "homeless services" (shelters, food, healthcare services etc.). This is high by the standard of most cities in the US, with the result that homeless people gravitate towards SF, or are even bussed there by other cities.

That and the mild weather makes SF a mecca for the homeless.

[Hallucigenia]

Joining the EU single market! I'm not sure they will let us, well not without paying a (too) high price or going against the voters wishes.

The European single market isn't confined to the EU, it includes countries like Norway that aren't members of the EU. So it's nothing to do with the voters' wishes - out of the EU but in the Single Market was the second choice of ~70% of voters, it was the one option with enough of a majority support to be stable, and arguably staying in the Single Market was what was promised when people voted to Leave. See eg "Absolutely nobody is talking about threatening our place in the Single Market" (Dan Hannan, 12 May 2015), "Increasingly the Norway option looks the best for the UK" (Arron Banks, 30 Dec 2015) and so on.

As for whether "they will let us" - broadly they want us back, but they just can't be doing with the drama of us flip-flopping. I suspect it would be "Non" to full membership unless the principle was broadly accepted across all parties likely to form a government. The Tories may or may not be included in that grouping after the next election. If nothing else, it's going to be very hard for the ERG to make political capital out of immigration when the riposte will now be - "you were in power, you had your hardest of hard Brexits, and yet net immigration still went over 700k - what else are you going to do - send them to Mars or that big iceberg that's now heading for South Georgia?"

Maybe Putin will invade and make us I suppose.

Putin is currently failing to invade a country on his border, how is he going to invade the UK? And why would he make us rejoin, when peeling apart the UK and EU to the detriment of both is perhaps his greatest triumph of foreign policy?

It conveniently erodes our national debt and increases the tax take. Inflation around 4% is quite comfy in govt terms.
They can give us back odd dribs and drabs of our money whilst continuing to steal it wholesale.

It's worse than that, because of the election. I've seen this AS described as taking £20bn of extra tax that came from inflation and spending it on bread and circuses, whilst doing nothing to fund the extra £20bn of costs that arise from inflation which then becomes a landmine for the next Parliament.

To take one example - universities are in a really bad place at the moment as CPI has gone up nearly 40% since student fees were last increased in 2012. But after what happened to the Libdems, nobody in politics has the guts to touch fees, let alone in the run-up to an election. So higher education is really stuffed - you're already seeing departments getting closed down and it could get worse.

[Lootman]

It conveniently erodes our national debt and increases the tax take. Inflation around 4% is quite comfy in govt terms.
They can give us back odd dribs and drabs of our money whilst continuing to steal it wholesale.

It's worse than that, because of the election. I've seen this AS described as taking £20bn of extra tax that came from inflation and spending it on bread and circuses, whilst doing nothing to fund the extra £20bn of costs that arise from inflation which then becomes a landmine for the next Parliament.

To take one example - universities are in a really bad place at the moment as CPI has gone up nearly 40% since student fees were last increased in 2012. But after what happened to the Libdems, nobody in politics has the guts to touch fees, let alone in the run-up to an election. So higher education is really stuffed - you're already seeing departments getting closed down and it could get worse.

But shouldn't Starmer absolutely be compelled in such a way to quickly jump off the fence?

Right now Starmer is walking this tightrope where he is simultaneously both criticising the Tories for an all-time high tax rate AND complaining that the government is not investing enough.

He is being oh so sensible and restrained about taxes, whilst allowing all the usual suspects to think they are going to get bailed out (universities, LAs, welfare recipients, public sector staff and so on).

It does not add up and Starmer should be forced to quickly decide if he is an old-school tax, borrow and spend leftie, or not? He cannot be all things to all special interest groups but that is his current position.

[Nimrod103]

It's worse than that, because of the election. I've seen this AS described as taking £20bn of extra tax that came from inflation and spending it on bread and circuses, whilst doing nothing to fund the extra £20bn of costs that arise from inflation which then becomes a landmine for the next Parliament.

To take one example - universities are in a really bad place at the moment as CPI has gone up nearly 40% since student fees were last increased in 2012. But after what happened to the Libdems, nobody in politics has the guts to touch fees, let alone in the run-up to an election. So higher education is really stuffed - you're already seeing departments getting closed down and it could get worse.

I haven't notced any bread and circuses type expenditure, so I'm not sure what you can be referring to.

Regarding university economics, perhaps vice-chancellors could look at their own exhorbitant pay levels before demanding more from students. Especially considering the extent to which students have been short changed by the lecturers strikes. Perhaps they could also do their jobs properly by ensuring free speech and thought on and off campus.
Anyway the whole university system needs bringing up to date. Advanced education now requires little actual lecture time, since so much can be done online. We still produce far too many humanities graduates, and far too few STEM graduates. And I was reading that UK medical schools are turning away far too many UK students. On another discussion board (but I have no reason to doubt the correspondent) somebody claimed that a relative who had sufficient qualifications but had failed to get entry was told the instituion had resorted to a lottery to award places.

[Gerry557]

Joining the EU single market! I'm not sure they will let us, well not without paying a (too) high price or going against the voters wishes.

The European single market isn't confined to the EU, it includes countries like Norway that aren't members of the EU. So it's nothing to do with the voters' wishes - out of the EU but in the Single Market was the second choice of ~70% of voters, it was the one option with enough of a majority support to be stable, and arguably staying in the Single Market was what was promised when people voted to Leave. See eg "Absolutely nobody is talking about threatening our place in the Single Market" (Dan Hannan, 12 May 2015), "Increasingly the Norway option looks the best for the UK" (Arron Banks, 30 Dec 2015) and so on.

As for whether "they will let us" - broadly they want us back, but they just can't be doing with the drama of us flip-flopping. I suspect it would be "Non" to full membership unless the principle was broadly accepted across all parties likely to form a government. The Tories may or may not be included in that grouping after the next election. If nothing else, it's going to be very hard for the ERG to make political capital out of immigration when the riposte will now be - "you were in power, you had your hardest of hard Brexits, and yet net immigration still went over 700k - what else are you going to do - send them to Mars or that big iceberg that's now heading for South Georgia?"

Maybe Putin will invade and make us I suppose.

Putin is currently failing to invade a country on his border, how is he going to invade the UK? And why would he make us rejoin, when peeling apart the UK and EU to the detriment of both is perhaps his greatest triumph of foreign policy?

It conveniently erodes our national debt and increases the tax take. Inflation around 4% is quite comfy in govt terms.
They can give us back odd dribs and drabs of our money whilst continuing to steal it wholesale.

It's worse than that, because of the election. I've seen this AS described as taking £20bn of extra tax that came from inflation and spending it on bread and circuses, whilst doing nothing to fund the extra £20bn of costs that arise from inflation which then becomes a landmine for the next Parliament.

To take one example - universities are in a really bad place at the moment as CPI has gone up nearly 40% since student fees were last increased in 2012. But after what happened to the Libdems, nobody in politics has the guts to touch fees, let alone in the run-up to an election. So higher education is really stuffed - you're already seeing departments getting closed down and it could get worse.

I've just checked back and noticed I forgot the post a smiley. I wasn't being serious about a UK invasion.

As for the EU, yes there could be a common sense solution but unfortunately politics on both sides seem to get in the way.

[spasmodicus]

It's worse than that, because of the election. I've seen this AS described as taking £20bn of extra tax that came from inflation and spending it on bread and circuses, whilst doing nothing to fund the extra £20bn of costs that arise from inflation which then becomes a landmine for the next Parliament.

To take one example - universities are in a really bad place at the moment as CPI has gone up nearly 40% since student fees were last increased in 2012. But after what happened to the Libdems, nobody in politics has the guts to touch fees, let alone in the run-up to an election. So higher education is really stuffed - you're already seeing departments getting closed down and it could get worse.

I haven't notced any bread and circuses type expenditure, so I'm not sure what you can be referring to.

Regarding university economics, perhaps vice-chancellors could look at their own exhorbitant pay levels before demanding more from students. Especially considering the extent to which students have been short changed by the lecturers strikes. Perhaps they could also do their jobs properly by ensuring free speech and thought on and off campus.
Anyway the whole university system needs bringing up to date. Advanced education now requires little actual lecture time, since so much can be done online. We still produce far too many humanities graduates, and far too few STEM graduates. And I was reading that UK medical schools are turning away far too many UK students. On another discussion board (but I have no reason to doubt the correspondent) somebody claimed that a relative who had sufficient qualifications but had failed to get entry was told the instituion had resorted to a lottery to award places.

It's pretty simple really. Pay grades for Technical College and Poly teachers were way below those of university staff, so someone came up with the bright idea of converting vocational training institutes into universities (cf Tony Blair's crackpot ideas below)
https://www.spiked-online.com/2022/04/19/tony-blair-is-dead-wrong-about-universities-again/

His introduction of tuition fees to offset the cost of putting everybody through university did, I suppose, indroduce a market element into the choice of whether to go to university or not, but it seems that young folks are not deterred by the huge debts they build up by getting a degree in some useless and oversubscribed subject, a career in which will never pay these back.
Meanwhile, vocational traIning in how to do useful things like manufacturing things or doing building works properly, or looking after old folk seems to depend on immigrants, because our own population cannot be **sed to do it. Many kids' mathematical attainments are too poor to work out that they would be a lot better off training to be, say, a heat pump installer, preferring instead to spend three years and tens of grand on a media studies degree presumably in the hope that they may become rich and famous.

S
(although I have a Ph.D. myself, when I ran a service company I avoided hiring people thus afflicted)

[CliffEdge]

It's worse than that, because of the election. I've seen this AS described as taking £20bn of extra tax that came from inflation and spending it on bread and circuses, whilst doing nothing to fund the extra £20bn of costs that arise from inflation which then becomes a landmine for the next Parliament.

To take one example - universities are in a really bad place at the moment as CPI has gone up nearly 40% since student fees were last increased in 2012. But after what happened to the Libdems, nobody in politics has the guts to touch fees, let alone in the run-up to an election. So higher education is really stuffed - you're already seeing departments getting closed down and it could get worse.

I haven't notced any bread and circuses type expenditure, so I'm not sure what you can be referring to.

Regarding university economics, perhaps vice-chancellors could look at their own exhorbitant pay levels before demanding more from students. Especially considering the extent to which students have been short changed by the lecturers strikes. Perhaps they could also do their jobs properly by ensuring free speech and thought on and off campus.
Anyway the whole university system needs bringing up to date. Advanced education now requires little actual lecture time, since so much can be done online. We still produce far too many humanities graduates, and far too few STEM graduates. And I was reading that UK medical schools are turning away far too many UK students. On another discussion board (but I have no reason to doubt the correspondent) somebody claimed that a relative who had sufficient qualifications but had failed to get entry was told the instituion had resorted to a lottery to award places.

Lot of fat in university economics, as just about everywhere.

No sensible understanding of what the state needs to do and what it should not do. Depressing listening to the shadow Chancellor's response to the statement. Same old same old general spray money about. No clarity, no focus. We have a bunch of idiots in government and such intellectual poverty in opposition, I despair. Many people depend on the state for their shelter and health. Those are the things the state should get right not all this woke garbage.

Since voters rejected the European Socialist Economic model in 2016 the UK is up an anus without a compass.

[SebsCat]

Truss tried to shatter the earth, tax-wise, and people panicked. So now politicians are terrified of doing anything bold and imaginative, and all we get is tinkering. Starmer will be the same. Managed decline. Just don't frighten the horses.

Yes. Any politician nowadays who displeases the Office of Budget Responsibility gets singled out PDQ as the nail which sticks out and is to be hammered down at all costs (as Liz Truss discovered).

The OBR does not apply arbitrary rules, it provides non-political judgement of the outcome of government fiscal policies according to that own government's fiscal rules. They, rightfully, pointed out that Truss's batshit crazy (to use the idiom of the current foreign secretary) policies would lead the country to economic ruin. If Truss had an ounce of political judgement she could have adjusted the OBR's remit before announcing her changes. But she was so stupid that she didn't even think of it. Which should be enough for any rational individual to conclude that she was the problem, regardless of whether you agree or disagree with her policies.

[ursaminortaur]

I haven't notced any bread and circuses type expenditure, so I'm not sure what you can be referring to.

Regarding university economics, perhaps vice-chancellors could look at their own exhorbitant pay levels before demanding more from students. Especially considering the extent to which students have been short changed by the lecturers strikes. Perhaps they could also do their jobs properly by ensuring free speech and thought on and off campus.
Anyway the whole university system needs bringing up to date. Advanced education now requires little actual lecture time, since so much can be done online. We still produce far too many humanities graduates, and far too few STEM graduates. And I was reading that UK medical schools are turning away far too many UK students. On another discussion board (but I have no reason to doubt the correspondent) somebody claimed that a relative who had sufficient qualifications but had failed to get entry was told the instituion had resorted to a lottery to award places.

It's pretty simple really. Pay grades for Technical College and Poly teachers were way below those of university staff, so someone came up with the bright idea of converting vocational training institutes into universities (cf Tony Blair's crackpot ideas below)
https://www.spiked-online.com/2022/04/19/tony-blair-is-dead-wrong-about-universities-again/

The polytechnics were converted to Universities in 1992 long before Labour came to power and Tony Blair became PM in 1997.

[spasmodicus]

It's pretty simple really. Pay grades for Technical College and Poly teachers were way below those of university staff, so someone came up with the bright idea of converting vocational training institutes into universities (cf Tony Blair's crackpot ideas below)
https://www.spiked-online.com/2022/04/19/tony-blair-is-dead-wrong-about-universities-again/

The polytechnics were converted to Universities in 1992 long before Labour came to power and Tony Blair became PM in 1997.

Indeed, but I struggle to understand whether increasing university education is a stimulant of growth or whether it's a luxury fuelled by increased revenue from growth. e.g.
https://www.sciencedirect.com/science/article/pii/S0272775718300414

this article suggests an unambiguous link between number of educational institutions and growth and that
There are a number of channels through which universities may affect growth including (i) a greater supply of human capital; (ii) more innovation; (iii) support for democratic values; and (iv) demand effects. Firstly, and most obviously, universities are producers of human capital and skilled workers are more productive than unskilled workers.

Be that as it may, fig.2 in the article shows cross plots of growth rate versus which appear to be horribly skewed by the errant point on the top right of each graph (representing the USA I think). There then follow a whole bunch of statistical arguments to justify their conclusions, which could only be made by some expensively educated academic.

Nor do they define what they mean by "university". In the case of the UK, we magically increased our supply of universities by renaming technical colleges and polys etc., in 1992 as ursaminortaur kindly pointed out. But if you look at UK growth since 1949, it continues to head downwards pretty consistently (even someone with Boris Johnson's level of understanding of graphs could see this?)
https://www.ons.gov.uk/economy/grossdomesticproductgdp/timeseries/ihyp/pn2

Their time would have been perhaps better spent repairing some potholes or fixing some broken dishwashers, but while they can wield an impressive chi-squared test, they probably don't know one end of a shovel (or hammer for that matter) from the other.

S
(not a statistician, he hastens to add)

[Nimrod103]

Be that as it may, fig.2 in the article shows cross plots of growth rate versus which appear to be horribly skewed by the errant point on the top right of each graph (representing the USA I think). There then follow a whole bunch of statistical arguments to justify their conclusions, which could only be made by some expensively educated academic.

I have spent much of my career interpreting and re-interpreting graphed data. Emphasizing the isolated point at the top right of a graph defining a trend is a very common error, which I suspect many social "scientists" are prone to.

[ursaminortaur]

The polytechnics were converted to Universities in 1992 long before Labour came to power and Tony Blair became PM in 1997.

Indeed, but I struggle to understand whether increasing university education is a stimulant of growth or whether it's a luxury fuelled by increased revenue from growth. e.g.
https://www.sciencedirect.com/science/article/pii/S0272775718300414

this article suggests an unambiguous link between number of educational institutions and growth and that
There are a number of channels through which universities may affect growth including (i) a greater supply of human capital; (ii) more innovation; (iii) support for democratic values; and (iv) demand effects. Firstly, and most obviously, universities are producers of human capital and skilled workers are more productive than unskilled workers.

Be that as it may, fig.2 in the article shows cross plots of growth rate versus which appear to be horribly skewed by the errant point on the top right of each graph (representing the USA I think). There then follow a whole bunch of statistical arguments to justify their conclusions, which could only be made by some expensively educated academic.

Nor do they define what they mean by "university". In the case of the UK, we magically increased our supply of universities by renaming technical colleges and polys etc., in 1992 as ursaminortaur kindly pointed out. But if you look at UK growth since 1949, it continues to head downwards pretty consistently (even someone with Boris Johnson's level of understanding of graphs could see this?)
https://www.ons.gov.uk/economy/grossdomesticproductgdp/timeseries/ihyp/pn2

Their time would have been perhaps better spent repairing some potholes or fixing some broken dishwashers, but while they can wield an impressive chi-squared test, they probably don't know one end of a shovel (or hammer for that matter) from the other.

S
(not a statistician, he hastens to add)

The trend for decades had been computerisation of office tasks, automation of factory floors in heavy industries and car plants, and replacement of those heavy industries by newer industries involving computers. The old manual jobs were disappearing hence there was a need for a more highly educated workforce. Unfortunately just allowing more people to go to University without also boosting their pre-university educational attainments combined with leaving which courses the Universities offered to the market led to many students applying for humanity courses rather than STEM courses as they were seen to be easier (and even to the Universities creating new doddy courses). I worked for a polytechnic which became a University which whilst it was a polytechnic had a large engineering department within a few years of its becoming a University that had gone as it was cheaper to provide other courses.

[Lootman]

The trend for decades had been computerisation of office tasks, automation of factory floors in heavy industries and car plants, and replacement of those heavy industries by newer industries involving computers. The old manual jobs were disappearing hence there was a need for a more highly educated workforce. Unfortunately just allowing more people to go to University without also boosting their pre-university educational attainments combined with leaving which courses the Universities offered to the market led to many students applying for humanity courses rather than STEM courses as they were seen to be easier (and even to the Universities creating new doddy courses). I worked for a polytechnic which became a University which whilst it was a polytechnic had a large engineering department within a few years of its becoming a University that had gone as it was cheaper to provide other courses.

As a humanities graduate myself, I am not sure I would agree that such degrees are "easier". Nor that they are necessarily more useless.

Part of the problem is that you now need a degree for jobs that historically never needed one. For example one younger couple I know both have degrees. He is a nurse and she is a teacher. 40 years ago neither job required a degree. Now both do. But the job is the same.

And with 2 small kids they are really struggling financially. A degree used to be a passport to a well-paid job. Now it is not, although not having a degree just means you are seen as a bit of a thickie with prospects that are not good.

[CliffEdge]

Indeed, but I struggle to understand whether increasing university education is a stimulant of growth or whether it's a luxury fuelled by increased revenue from growth. e.g.
https://www.sciencedirect.com/science/article/pii/S0272775718300414

this article suggests an unambiguous link between number of educational institutions and growth and that
There are a number of channels through which universities may affect growth including (i) a greater supply of human capital; (ii) more innovation; (iii) support for democratic values; and (iv) demand effects. Firstly, and most obviously, universities are producers of human capital and skilled workers are more productive than unskilled workers.

Be that as it may, fig.2 in the article shows cross plots of growth rate versus which appear to be horribly skewed by the errant point on the top right of each graph (representing the USA I think). There then follow a whole bunch of statistical arguments to justify their conclusions, which could only be made by some expensively educated academic.

Nor do they define what they mean by "university". In the case of the UK, we magically increased our supply of universities by renaming technical colleges and polys etc., in 1992 as ursaminortaur kindly pointed out. But if you look at UK growth since 1949, it continues to head downwards pretty consistently (even someone with Boris Johnson's level of understanding of graphs could see this?)
https://www.ons.gov.uk/economy/grossdomesticproductgdp/timeseries/ihyp/pn2

Their time would have been perhaps better spent repairing some potholes or fixing some broken dishwashers, but while they can wield an impressive chi-squared test, they probably don't know one end of a shovel (or hammer for that matter) from the other.

S
(not a statistician, he hastens to add)

The trend for decades had been computerisation of office tasks, automation of factory floors in heavy industries and car plants, and replacement of those heavy industries by newer industries involving computers. The old manual jobs were disappearing hence there was a need for a more highly educated workforce. Unfortunately just allowing more people to go to University without also boosting their pre-university educational attainments combined with leaving which courses the Universities offered to the market led to many students applying for humanity courses rather than STEM courses as they were seen to be easier (and even to the Universities creating new doddy courses). I worked for a polytechnic which became a University which whilst it was a polytechnic had a large engineering department within a few years of its becoming a University that had gone as it was cheaper to provide other courses.

Happened all over the country regrettably. I bumped into one of my old Poly lecturers, he was lamenting the decline of the former poly.