Britain’s statisticians fix a blunder and find a bigger economy(economist.com)
economist.com
Britain’s statisticians fix a blunder and find a bigger economy
https://www.economist.com/britain/2023/09/04/britains-statisticians-fix-a-blunder-and-find-a-bigger-economy
129 comments
https://archive.ph/kLEvd
Two economists are walking in a forest when they come across a pile of shit.
The first economist says to the other “I’ll pay you $100 to eat that pile of shit.” The second economist takes the $100 and eats the pile of shit.
They continue walking until they come across a second pile of shit. The second economist turns to the first and says “I’ll pay you $100 to eat that pile of shit.” The first economist takes the $100 and eats a pile of shit.
Walking a little more, the first economist looks at the second and says, "You know, I gave you $100 to eat shit, then you gave me back the same $100 to eat shit. I can't help but feel like we both just ate shit for nothing."
"That's not true", responded the second economist. "We increased the GDP by $200!"
The first economist says to the other “I’ll pay you $100 to eat that pile of shit.” The second economist takes the $100 and eats the pile of shit.
They continue walking until they come across a second pile of shit. The second economist turns to the first and says “I’ll pay you $100 to eat that pile of shit.” The first economist takes the $100 and eats a pile of shit.
Walking a little more, the first economist looks at the second and says, "You know, I gave you $100 to eat shit, then you gave me back the same $100 to eat shit. I can't help but feel like we both just ate shit for nothing."
"That's not true", responded the second economist. "We increased the GDP by $200!"
The revealed preferences in this story display that for these two individuals there is at least $100 of value in viewing this spectacle, and no more than $100 distaste in performing this spectacle. Sadly GDP does not measure how much surplus value was created by these two transactions, given that maximizing utility is a better normative goal than maximizing GDP, but GDP did indeed increase by $200 and it is accurate in indicating that at least total utility was increased (less unaccounted for externalities like unfertilized trees or whatever).
> value
In this case we have two approximately equal economists, but in general any discussion about revealed preferences, utility, and value is remiss without a parallel discussion on how value is wealth-weighted. Feeding a starving orphan creates 0 economic value because the orphan has no money, but figuring out how to merge companies into a monopoly creates extreme amounts of economic value by way of making rich investors even richer.
In this case we have two approximately equal economists, but in general any discussion about revealed preferences, utility, and value is remiss without a parallel discussion on how value is wealth-weighted. Feeding a starving orphan creates 0 economic value because the orphan has no money, but figuring out how to merge companies into a monopoly creates extreme amounts of economic value by way of making rich investors even richer.
> 0 economic value
Economic value is not only distinguished as economic measurement. This is why utility theory and revealed preference theory exist.
Economic value is not only distinguished as economic measurement. This is why utility theory and revealed preference theory exist.
I mean… yes. That is how this works. The problem with its implied understanding is that the economists don’t appear to have gained anything from the work they paid the other to do. GDP is generally a pretty decent stat because people tend to pay things to do things that provide them with some sort of value.
With notable exceptions for things like war.
With notable exceptions for things like war.
Right. Presumably in that scenario both economists thought it to be at least $100 worth of entertainment to watch the other eat shit, while both also thought $100 was enough compensation to eat it. Everyone is better off.
Just because you think you're better off doesn't mean you're better off though.
Why not? What we think is pretty much all that matters
Perhaps cumulatively, but in a particular moment? A infectious disease specialist may further raise GDP in this story, moments or years later.
> GDP is generally a pretty decent stat because people tend to pay things to do things that provide them with some sort of value.
Only if the net value is positive-sum.
Setting a city on fire, or giving cancer to a million people, or just going down the street, smashing every parked car's window with a tire iron will likely increase national GDP.
Liekwise, people pay a lot of money for net negative-sum industries - the health insurance industry in the US immediately springs to mind. We'd all be better off without that parasite.
Only if the net value is positive-sum.
Setting a city on fire, or giving cancer to a million people, or just going down the street, smashing every parked car's window with a tire iron will likely increase national GDP.
Liekwise, people pay a lot of money for net negative-sum industries - the health insurance industry in the US immediately springs to mind. We'd all be better off without that parasite.
We do have to assume that externalities are not so material as to render such stats misleading, yes.
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I mean, we have to pay someone to guarantee coverage in the event of catastrophic losses. You might even call them insurance companies.
If only there was a way to have just one of those insurance companies, maybe run as a government agency of sorts... Wait, I got one of those where I live, it's called the Ontario Health Insurance Plan. It is not amazing but it easily clears the extremely low bar of being better than the US health insurance setup.
Over in Manitoba they've got one of those for car insurance too. Amazingly, people continue driving there just the same, the government insurance plan never needs subsidies and Manitobans pay way less for insurance. Almost as if the concept of the free market being the best solution for market X needs to be tested once in a while just to be sure, and results may be surprising.
Over in Manitoba they've got one of those for car insurance too. Amazingly, people continue driving there just the same, the government insurance plan never needs subsidies and Manitobans pay way less for insurance. Almost as if the concept of the free market being the best solution for market X needs to be tested once in a while just to be sure, and results may be surprising.
It's possible for really motivated individuals to run a government department well, if you have people of excellent character, work ethic and competence doing so, but there's not a load of incentive for them to be run well outside of that unlikely combination.
Well, while we're on the topic of insinuations that totally don't give away underlying biases, it's possible for really ethical individuals to run a number of competing corporations well, though there's not a load of incentive for them to steer clear of regulatory capture, cartel-like collusion and various other forms of customer-screwing behaviour.
The larger point being: there are many areas of the economy in which the free market approach is clearly better, and there are many other areas of the economy in which the free market approach is clearly deficient and a government-run agency is superior. Insurance is in neither of these convenient buckets. "Unlikely" is an opinion on a hypothetical; it is not necessary when real-world examples abound.
The larger point being: there are many areas of the economy in which the free market approach is clearly better, and there are many other areas of the economy in which the free market approach is clearly deficient and a government-run agency is superior. Insurance is in neither of these convenient buckets. "Unlikely" is an opinion on a hypothetical; it is not necessary when real-world examples abound.
Any market is shaped by policy. It can be argued that the US health insurance market is not really free in significant ways and set up such that the net result is the mess we see. A government-run institution performing better than the private market is not necessarily a sign that the institution is good, it might just mean that the market is set up in a deficient way.
I mean, last time I looked, social security in France gave back 81€ for every 100€ invested. Swisslife (it was either 2018 or 2019) gave back the same year 67€ for every 100€. What's funny is that only 11€ went to shareholders that year, that mean that even w/o capitalists, sometimes public services are more efficient than private companies.
As I said a few comments above, it's possible for things to be run efficiently; there's just less of an incentive to do so.
In terms of this exact comparison - is this like for like? I don't understand it well enough to know.
In terms of this exact comparison - is this like for like? I don't understand it well enough to know.
I'm not insinuating anything; I'm just saying it. What do you think I was insinuating?
Too bad Manitoba guillotined its public telecom. How's Bhell treating you these days?
The risk pooling isn't the problem, its not why the industry is an unproductive leech on our society. The insane amounts of waste and bureaucracy it produces, and the price inflation it facilitates is.
(Not to mention suboptimal health outcomes arising from the perverse incentives it creates.)
(Not to mention suboptimal health outcomes arising from the perverse incentives it creates.)
Net negative sum would by definition lower GDP.
GDP is a proxy for 'amount of work done that people were paid for'.
If I pay Fat Tony to break your legs, and then you pay a doctor to put them back together, this whole adventure increased GDP, but is a net-negative-sum activity.
"People have to do more work to accomplish the same amount of results" isn't a worthy goal in itself.
If I pay Fat Tony to break your legs, and then you pay a doctor to put them back together, this whole adventure increased GDP, but is a net-negative-sum activity.
"People have to do more work to accomplish the same amount of results" isn't a worthy goal in itself.
And me not working due to broken legs is somehow not relevant to the GDP? My capital being misallocated is not relevant to GDP? I think your example is quite likely to lower GDP...
> My capital being misallocated is not relevant to GDP?
It's not. If I steal a million dollars from you, the net impact on GDP is ~0. Hell, if you were keeping it in your mattress, and I spend it on drugs and parties, GDP will actually go up.
GDP is a useful number, but it's not the only useful number.
It's not. If I steal a million dollars from you, the net impact on GDP is ~0. Hell, if you were keeping it in your mattress, and I spend it on drugs and parties, GDP will actually go up.
GDP is a useful number, but it's not the only useful number.
If you steal 1 million out of my payroll account, GDP might go down because I might close my shop, for example. It really is not so simple.
Could one carefully construct examples, sure, does that scale - not so much.
Could one carefully construct examples, sure, does that scale - not so much.
Unless you earn more than the 200k the doctor was paid plus the 50k Fat Tony rightfully earned, the GDP grew.
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But wouldn’t that be true of any kind of performance art? What value is created by me paying to watch a musician/movie/baseball? Fundamentally seems the same as watching someone eat shit for my amusement.
Your enjoying of it. The economists in the story don’t acknowledge enjoying making the other eat shit.
It is valuable to society to do things that create joy.
Shit eating may not hold up specifically.
It is valuable to society to do things that create joy.
Shit eating may not hold up specifically.
One of the advantages of money is that the enjoyment is implicit in the exchange, with no explicit acknowledgment necessary.
The enjoyment derived by the watcher must exceed that of having $100 and using that money in the future, or he wouldn’t have paid out. The disgust of the eater is more than compensated by the $100, or he wouldn’t accept that payment and do the job.
Both coprophages have thus derived utility from the exchange. From an economic standpoint, eating shit is just a form of working.
The enjoyment derived by the watcher must exceed that of having $100 and using that money in the future, or he wouldn’t have paid out. The disgust of the eater is more than compensated by the $100, or he wouldn’t accept that payment and do the job.
Both coprophages have thus derived utility from the exchange. From an economic standpoint, eating shit is just a form of working.
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Is that not the implicit agreement of capitalism? If I trade X dollars for a thing, I got something I value for it. Joy, revenge, boredom, or just a lighter load in the wallet. Something must have been gained. By definition, it seems that both economists gained the experience they wanted of watching the other debase themselves.
Yes. And GDP is a rough measurement of how much value is being created, in dollars.
A at-home dad get paid nothing to take care of his children.
He takes a 50k job, pays à baby-sitter 20k (said babysitter couldn't find a service job that could pay him 50k, weirdly), and voilà, 70k GDP.
He takes a 50k job, pays à baby-sitter 20k (said babysitter couldn't find a service job that could pay him 50k, weirdly), and voilà, 70k GDP.
I’m not going to argue that GDP is a perfect metric, because it clearly is not. But I feel obliged to point out that 5/7 of the GDP created in your own scenario is a guy doing presumably valuable work, and 2/7 is the baby sitter doing previously unaccounted for work; which is also based on wages, perhaps more fit to their skills.
It would be great if we could measure work done without exchange of goods however that is generally not so large as to totally distort the general numbers. To no discredit of the work parents do.
It would be great if we could measure work done without exchange of goods however that is generally not so large as to totally distort the general numbers. To no discredit of the work parents do.
> He takes a 50k job
so, he produces 50k value somewhere
so, he produces 50k value somewhere
Healthier gut biome, people pay for this stuff.
It’s supposed to go in the other end though. Stomach acid is unforgiving.
Just in case anyone ever needs to DIY a stool transplant, double encapsulation with inner gelatin and outer enteric coated capsules works. Do a colonoscopy prep the previous day and try to take repeat doses throughout several days and in between meals rather than all at once.
https://www.fda.gov/news-events/press-announcements/fda-appr....
"""
The administration of fecal microbiota is thought to facilitate restoration of the gut flora to prevent further episodes of CDI.
The dosing regimen of Vowst is four capsules taken once a day, orally, for three consecutive days. """
The dosing regimen of Vowst is four capsules taken once a day, orally, for three consecutive days. """
That’s the pharmaceutical version. When going organic, you gotta make compromises.
(I’m kidding. Obviously we don’t put probiotic foods up our butt, even though I do find yoghurt works great as a lubricant)
(I’m kidding. Obviously we don’t put probiotic foods up our butt, even though I do find yoghurt works great as a lubricant)
To be pedantic, if you ate it fast enough in large chunks as economists do, the inner core might survive as the outer core dissolves at some rate (faster rate but thicker shell to compensate compared to the pharmaceuticals).
In the real world, each would have had to declare $100 of income and pay the appropriate income tax. The more they eat, the more often money changes hands, the more tax income the government receives. Velocity of money. https://en.wikipedia.org/wiki/Velocity_of_money
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There are so many funny punch lines available after the second shit pile is eaten
"We earned 100$ each!"?
"We earned 60$ each and owe the state 40$!"
Or do you have a better suggestion? I will retell this story so please share.
"We earned 60$ each and owe the state 40$!"
Or do you have a better suggestion? I will retell this story so please share.
The first economist picks the shit from the ground and sells it to somebody with a box for 25$, which delivers it to another person for 50$, which wraps it in a film and sells it to another person for 75$, which finally hands it to the second economist for 100$. GDP 250$. Add more links to the supply chain as you please.
GDP is estimated on a value added basis to avoid complex supply chains being worth more than the final sale price, FWIW.
It's one of the reasons it's so easy to screw up the estimates when companies have bigger inventories than usual...
It's one of the reasons it's so easy to screw up the estimates when companies have bigger inventories than usual...
This sounds good and funny at first but how is this different from this scenario: A software engineer pays a dentist for servicing his teeth and he turns around to pay the software engineer to build an appointment system for him? Clearly lots of value was created so unless this is to illustrate that GDP calculations can't filter out bogus transactions (bogus according to whom), I can't really make sense of it...
Eating shit provides very little value to anyone.
This example points out that we also have to look out whether GDP is also tied to valuable activities.
Things that come to mind are gambling, buying lottery, trading arts / crypto / stocks, and generally entertainment.
Some activities offer very little value.
This means these low value activities should reflect a minor part of your total GDP.
If the majority of your GDP comes from people in your own country trading arts with each other, you are fucked.
This example points out that we also have to look out whether GDP is also tied to valuable activities.
Things that come to mind are gambling, buying lottery, trading arts / crypto / stocks, and generally entertainment.
Some activities offer very little value.
This means these low value activities should reflect a minor part of your total GDP.
If the majority of your GDP comes from people in your own country trading arts with each other, you are fucked.
[deleted]
Well, there's also $200 worth of shit no longer left on the ground, now that we have an established market rate of $100 per pile of shit.
and proved, yes, there is such as thing as a free lunch... it'll just taste like shit
Here is a less scatological parable about GDP.
Alice loves widgets. She would pay $100 for a widget. She goes on line and finds Bob offering widgets for sale for $100. Err, that is not really what she had in mind. She imagined paying $30 for a widget, and feeling $70 better off as a consequence. She emails Bob: How about $90?
Bob feels like giving up altogether. It takes him ten hours to hand craft a widget and the minimum wage where he lives is $10 an hour. He was offering widgets for $150. $100 is the absolute minimum. Bob replies: No.
While Alice is deciding whether to pay $100 for a widget that is only worth $100 to her, Carol puts the finishing touches to her widget making machine. At the press of a button Carol can produce a widget for only $10. She activates her website, offering widgets for $40. Alice orders one at once.
How would Eve the economist like to analyse this? She would like to identify a consumer surplus of 100 - 40 = 60 dollars, and a producer surplus of 40 - 10 = 30 dollars, for a total gain from trade of 60 + 30 = 90 dollars. But before she can do this she has to telephone Alice and Carol and find out the secret numbers, $100 and $10. Only the market price of $40 is overt.
Alice thinks Eve is spying for Carol. If Carol learns that Alice is willing to pay $100, she will up the price to $80. So Alice bullshits Eve: Yeh, I'm regretting my purchase, I've rushed to buy a widget, but what's it worth really? $35. I've over paid.
Carol thinks Eve is spying for Alice. If Alice learns that they only cost $10 to make, then she will bargain Carol down to $20. Carol bullshits Eve: Currently they cost me $45 to make, but if I can grow volumes I'll get a bulk discount on raw materials and I hope to be making them for $35 and be in profit by 2016.
Eve realises that she isn't going to be able to get the numbers she needs, so she values the trade at its market price and declares GDP to be $40. It is what economist do. It is the desperate expedient to which the opacity of business has reduced them.
Now for the twist in the tale. Carol presses the button on her widget making machine, which catches fire and is destroyed. Carol gives up widget making. Alice buys from Bob for $100. Neither is happy with the deal; the total of consumer surplus and producer surplus is zero. Alice is thinking that she would have been happier spending her $100 eating out. Bob is thinking that he would have had a nicer time earning his $100 waiting tables for 10 hours.
Eve revises her GDP estimate. She has committed herself to market prices, so it is up 150% at $100. Err, that is not what is supposed to happen. Vital machinery is lost in a fire, prices soar and goods are produced by tedious manual labour, the economy has gone to shit, producing no surplus instead of producing a $90 surplus. But Eve's figures make this look good.
Alice loves widgets. She would pay $100 for a widget. She goes on line and finds Bob offering widgets for sale for $100. Err, that is not really what she had in mind. She imagined paying $30 for a widget, and feeling $70 better off as a consequence. She emails Bob: How about $90?
Bob feels like giving up altogether. It takes him ten hours to hand craft a widget and the minimum wage where he lives is $10 an hour. He was offering widgets for $150. $100 is the absolute minimum. Bob replies: No.
While Alice is deciding whether to pay $100 for a widget that is only worth $100 to her, Carol puts the finishing touches to her widget making machine. At the press of a button Carol can produce a widget for only $10. She activates her website, offering widgets for $40. Alice orders one at once.
How would Eve the economist like to analyse this? She would like to identify a consumer surplus of 100 - 40 = 60 dollars, and a producer surplus of 40 - 10 = 30 dollars, for a total gain from trade of 60 + 30 = 90 dollars. But before she can do this she has to telephone Alice and Carol and find out the secret numbers, $100 and $10. Only the market price of $40 is overt.
Alice thinks Eve is spying for Carol. If Carol learns that Alice is willing to pay $100, she will up the price to $80. So Alice bullshits Eve: Yeh, I'm regretting my purchase, I've rushed to buy a widget, but what's it worth really? $35. I've over paid.
Carol thinks Eve is spying for Alice. If Alice learns that they only cost $10 to make, then she will bargain Carol down to $20. Carol bullshits Eve: Currently they cost me $45 to make, but if I can grow volumes I'll get a bulk discount on raw materials and I hope to be making them for $35 and be in profit by 2016.
Eve realises that she isn't going to be able to get the numbers she needs, so she values the trade at its market price and declares GDP to be $40. It is what economist do. It is the desperate expedient to which the opacity of business has reduced them.
Now for the twist in the tale. Carol presses the button on her widget making machine, which catches fire and is destroyed. Carol gives up widget making. Alice buys from Bob for $100. Neither is happy with the deal; the total of consumer surplus and producer surplus is zero. Alice is thinking that she would have been happier spending her $100 eating out. Bob is thinking that he would have had a nicer time earning his $100 waiting tables for 10 hours.
Eve revises her GDP estimate. She has committed herself to market prices, so it is up 150% at $100. Err, that is not what is supposed to happen. Vital machinery is lost in a fire, prices soar and goods are produced by tedious manual labour, the economy has gone to shit, producing no surplus instead of producing a $90 surplus. But Eve's figures make this look good.
If you zoom out and look at the aggregate widget contribution to the GDP (price * # sold), it is likely that the effect is either much reduced or goes away entirely. Fewer people will buy for $100, depending on price elasticity on demand the GDP number may in fact end up accurately reflecting that something shitty took place.
Thanks for the instructive example! Gives a much clearer understanding of GDP.
Anyone have recommendations for Economics books that explain such concepts with simple to understand examples?
Anyone have recommendations for Economics books that explain such concepts with simple to understand examples?
This story ... was really good. I feel funny stories like these are way to rare today. They used to be way more common.
Tangential, but your joke got a laugh from Elon Musk: https://twitter.com/elonmusk/status/1699289522167517475
The ONS, like Eurostat is a genuinely useful organization full of people who care about the accuracy of numbers. When the original data was released, they were clear that there were likely to be revisions. As it turns out the revisions are bigger than expected but the justification that during the Corona crisis, businesses didn't prioritize the form filling required by the ONS, is reasonable. There is also a change in methodology for many of the global stats agency in how GDP is calculated. The ONS is actually ahead of the game in getting that implemented. It's also had a positive effect, one that is likely to be replicated in other countries as they adopt the changes.
Anyone from Eurostat present here? I tried tot look for jobs a few times, but many (all?) their positions require you to be 'delegated' from somewhere else. What's up with that and how does it work?
It means you're a civil servant in your own country (eg in the national statistical office) and you're sent to work at Eurostat for a period of time.
Does that mean most Eurostat staff isn't permanent?
I used to work for the Insee, the French public statistics institute. Eurostat is small, and more about coordination and harmonisation, whereas most of the production of survey and statistics where handled by the statistics offices of each country. And most of Eurostat specialist are delagated from countries' stat offices. So first, get a job there, then move to eurostat.
[deleted]
Am I missing something or is there no "blunder" described in the article? I'm my view, a blunder would be something like the missing rows in the Excel formula that was used as a basis for the austerity policy in 2010 or indeed the row limit being exceeded which led to thousands of COVID test results being lost.
https://theconversation.com/excel-errors-the-uk-government-h...
https://theconversation.com/excel-errors-the-uk-government-h...
Completely agree. They did the best with the data they had. I’m glad they didn’t fudge it upwards earlier. If anything, this gives me more confidence in the ONS because they did the right things.
I know unsophisticated people only look at the result, not the process. These folks are quick to blame whenever they perceive a mistake. Disappointed to see this take from the Economist.
I know unsophisticated people only look at the result, not the process. These folks are quick to blame whenever they perceive a mistake. Disappointed to see this take from the Economist.
It’s being called a blunder in order to undermine the credibility of the ONS, as given the state of affairs in the U.K., it’s hard to see that this is anything other than a result of political pressure - Ian Diamond has some skeletons in his closet (beyond his “overlooking” a few hundred thousand pounds he was overpaid by UoA) that make him a straightforward target for a quid pro quo.
Is anyone calling it a blunder other than The Economist, which has little interest in undermining the ONS (and the article is quite respectful of it)?
A simpler explanation would be that "blunder" makes an exciting headline. Have you any evidence to support your explanation?
A simpler explanation would be that "blunder" makes an exciting headline. Have you any evidence to support your explanation?
The last 13 years, and personally knowing people who have had their arms twisted by the current government. One cowed, one did not. One lives, one does not.
This government is all about extortion and information manipulation.
This government is all about extortion and information manipulation.
This is nothing but a long, evasive way to say "no".
It really isn’t, but I understand that you’re a died-in-the-wool Tory and you won’t see the state criticised. I knew a judge who was pressured to put politics before justice and refused, and he was destroyed for doing so, and a speechwriter for a recent prime minister who was threatened with dire consequences if he leaked a story which would have made said prime minister subject to a criminal investigation (not Johnson!), and decided to stay stumme as a result.
But you go on believing that conservatives can do no wrong.
But you go on believing that conservatives can do no wrong.
[deleted]
Back in 2013, a student found some basic errors in an Excel spreadsheet that was used to justify very harsh austerity measures (cuts to various social services and safety nets, the NHS, etc.) in the UK.
Those austerity measures were responsible for deaths, ruined lives, and a massive decrease in quality of life for countless UK residents.
https://www.bbc.com/news/magazine-22223190
Those austerity measures were responsible for deaths, ruined lives, and a massive decrease in quality of life for countless UK residents.
https://www.bbc.com/news/magazine-22223190
this revision more or less destroys the narrative of the past two years that the UK economy's covid recovery has lagged the larger EU countries due to brexit
the FT was particularly upset that its past 2 years of depressive reporting have essentially been voided
https://www.ft.com/content/7b95e3d9-c5a1-42d5-84a8-921c9088c...
I do wonder how much damage the constant unsubstantiated media gloom over the past 5 years has done to UK investment
(thankfully the UK consumer ignored it and kept spending)
the FT was particularly upset that its past 2 years of depressive reporting have essentially been voided
https://www.ft.com/content/7b95e3d9-c5a1-42d5-84a8-921c9088c...
I do wonder how much damage the constant unsubstantiated media gloom over the past 5 years has done to UK investment
(thankfully the UK consumer ignored it and kept spending)
Until other countries also revise their GDP estimate, according to the article.
There's reason why economics isn't in the faculty of science.
How is it related to economics?
See it. Say it. Sorted.
Surely this means the government will lower taxes and interest rates. Right?
Well, possibly. There's a lot of political pressure on them from the right to do that. But if they did it would probably be targeted at businesses, maybe rates relief.
Several billion needs to be spent on collapsing schools and Birmingham has just gone bankrupt. We need a significant amount of public spending just to maintain the country.
Then we should probably spend less on projects benefiting tory friends? Or is the ultimate goal to tax everyone at a 100% rate? Also the NHS should be privatised already, it’s painful to see all the money wasted on it.
> Then we should probably spend less on projects benefiting tory friends?
Yes, obviously.
> Also the NHS should be privatised already, it’s painful to see all the money wasted on it
What's an acceptable casualty level for this transition? 100k or 1m? There's 4.8m diabetics in the UK, how many of them do you expect to not be able to afford insulin?
Yes, obviously.
> Also the NHS should be privatised already, it’s painful to see all the money wasted on it
What's an acceptable casualty level for this transition? 100k or 1m? There's 4.8m diabetics in the UK, how many of them do you expect to not be able to afford insulin?
Yes! The UK can tax it's way to prosperity.
I can save €6k per year by not paying any rent, but doing so will cause a huge number of problems, starting almost immediately.
Getting a cheaper place isn't completely impossible, but I'd just have to go somewhere far enough away that commuting may be impossible or impractical and that will upset my current employers.
Governments aren't the same as households — I can't force people to accept any "money"[0] I might try to "print"[0], nor do I run a central bank whose interest rates I get to set, nor do I collect taxes or customs duties — but there are analogies, and "infrastructure ≈ housing" is one.
What the UK needs more than anything else right now is a realistic economic plan; unfortunately the UK government appears to be unable to tell the difference between that, their rhetoric, and their wishful thinking.
[0] it isn't money if no one accepts it, literally printing something that even tries to be money is something I assume to be a crime without checking, and money is increasingly digital these days so why even do that?
Getting a cheaper place isn't completely impossible, but I'd just have to go somewhere far enough away that commuting may be impossible or impractical and that will upset my current employers.
Governments aren't the same as households — I can't force people to accept any "money"[0] I might try to "print"[0], nor do I run a central bank whose interest rates I get to set, nor do I collect taxes or customs duties — but there are analogies, and "infrastructure ≈ housing" is one.
What the UK needs more than anything else right now is a realistic economic plan; unfortunately the UK government appears to be unable to tell the difference between that, their rhetoric, and their wishful thinking.
[0] it isn't money if no one accepts it, literally printing something that even tries to be money is something I assume to be a crime without checking, and money is increasingly digital these days so why even do that?
Interest rates are set by the Bank of England which is independent of the government.
And globally inflation has been high but trending down. Same as in the UK.
And globally inflation has been high but trending down. Same as in the UK.
Decreasing taxes right now is likely to increase inflation and hence interest rates.
will lower taxes and interest rates. Right? (MEME)
I detest my cynicism that immediately made me roll my eyes and remember that there's an election coming up, and the opposition party is making big economic growth promises. So this is very timely for the incumbent government.
The ONS ought to be above political motivation and is, I believe, not politically controlled, so I doubt that cynical take would really explain the facts.
The ONS ought to be above political motivation and is, I believe, not politically controlled, so I doubt that cynical take would really explain the facts.
A friend of mine works for the ONS and the notion that anyone within the entire organization would lift a finger to help the incumbent Govt is laughable.
Let alone lifting the figures! Thanks for the reality check.
What an odd thing to say.
If Labour was in government that cynical take would be pushed hard by British conservative media.
The ONS is something called a “Non departmental public body” which means it is not under the control of a minister and is at arms length from the current political rulers of the day.
https://www.gov.uk/guidance/public-bodies-reform#:~:text=A%2....
Weirdly I used to work both at the ONS, and subsequently at the department of the cabinet office responsible for tracking and reporting on them!
https://www.gov.uk/guidance/public-bodies-reform#:~:text=A%2....
Weirdly I used to work both at the ONS, and subsequently at the department of the cabinet office responsible for tracking and reporting on them!
Where does its funding come from, and who has the power to increase or decrease it?
Labour are certain to win the next election.
Let's say that the tories threaten the ONS with a sharp cut if they don't "play ball". Here are the scenarios.
ONS decide not to do it : leak to the press, Labour promise to reverse funding cut, funding cut doesn't come into force, Tories humiliated, Labour look favourably on ONS.
ONS decide to do it : Labour come into power, discover what happened (someone will talk), blood up the walls, ONS disolved etc.
So, I do not think that this is politically driven.
Let's say that the tories threaten the ONS with a sharp cut if they don't "play ball". Here are the scenarios.
ONS decide not to do it : leak to the press, Labour promise to reverse funding cut, funding cut doesn't come into force, Tories humiliated, Labour look favourably on ONS.
ONS decide to do it : Labour come into power, discover what happened (someone will talk), blood up the walls, ONS disolved etc.
So, I do not think that this is politically driven.
Labour couldn’t win an election even if the opposition was Myra Hindley and Skeletor running on a platform of universal torture. They’d be photographed drinking shandy on a bus, or eating a sandwich, and that would be that.
I think you have forgotten the effect that Liz Truss had on the electorate.
I dont know about that, they've grabbed defeat from the jaws of victory before. Starmer isnt Blair, and no one really trusts or likes Labour that much. It wont take much for peoples moods to turn against them.
Would you like to take a bet at, say, 10-1 odds?
Well - I don't bet mate. I've seen too many people ruin themselves doing it. I really suggest that you think very carefully about making bets at those odds as well as it often (about 9 times out of 10?) ends badly. Unless you have asymmetric information access of course.
> Labour are certain to win the next election.
Oh i very much doubt that. No one wants to pay 80% in tax as thats what will be needed to fund their social programs.
Oh i very much doubt that. No one wants to pay 80% in tax as thats what will be needed to fund their social programs.
I see where you’re going with this, but it’s not that simple. These bodies are created by various means - some are created through primary legislation, some are a bit more discretionary in their nature, but they all have a terms of reference and an independent board that provides governance.
The idea that the ONS would juice their figures due to political pressure is only something that seems plausible if you aren’t aware of how it’s set up.
Here’s their board: https://www.ons.gov.uk/aboutus/transparencyandgovernance/lea...
Who on that board would be under the thumb? How would they get an organisation of hundreds of economists and statisticians to fall into line with their plan?
The idea that the ONS would juice their figures due to political pressure is only something that seems plausible if you aren’t aware of how it’s set up.
Here’s their board: https://www.ons.gov.uk/aboutus/transparencyandgovernance/lea...
Who on that board would be under the thumb? How would they get an organisation of hundreds of economists and statisticians to fall into line with their plan?
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Considering that labour is likely to increase taxes even more and tories will likely decrease the taxes they themselves increased, the next election is a nearly guaranteed tory win. They just have to sack rishi sunak.
Good news for you is that if you genuinely believe what you wrote, you'll be pleased to know that since most of the country disagrees with your prediction it's priced as unlikely with bookmakers - so you can get a 450% ROI if you bet on tory win at next general election and it happens! (Different companies odds for it ranging from 24/5 to 4/1 [0])
Good news for the rest of us is that most people don't take such a simplistic view and that therefore promising lower taxes than Labour doesn't guarantee a Tory win.
In not so good news, Labour have already back-peddled on most of Starmer's original tax-raising pledges and plans, and it seems that (with the possible exception of their being open to doing a one-off tax on the handful of biggest fossil fuel energy companies) they're not going to be looking to raise taxes on almost any area.
Personally I'd like to see a bit of a decrease in income taxes (primarily for the bottom 80% of earners; same or slight decrease for 80-99% percentiles; new slightly higher tier for top 1%) while bringing capital gains tax in line with income tax bands and rates. Because currently the highest rate of cap gains tax is 20%, the same as the lowest band of income tax. Anything you earn above ~£50k of income you pay 40% tax on, earning the same as capital gains... still just 20%. And while I'm at it, a slight increase on business rates too, either only targeting big businesses or specifically excluding businesses under a certain size. PLUS the one-off big tax on energy giants.
https://www.oddschecker.com/politics/british-politics
Good news for the rest of us is that most people don't take such a simplistic view and that therefore promising lower taxes than Labour doesn't guarantee a Tory win.
In not so good news, Labour have already back-peddled on most of Starmer's original tax-raising pledges and plans, and it seems that (with the possible exception of their being open to doing a one-off tax on the handful of biggest fossil fuel energy companies) they're not going to be looking to raise taxes on almost any area.
Personally I'd like to see a bit of a decrease in income taxes (primarily for the bottom 80% of earners; same or slight decrease for 80-99% percentiles; new slightly higher tier for top 1%) while bringing capital gains tax in line with income tax bands and rates. Because currently the highest rate of cap gains tax is 20%, the same as the lowest band of income tax. Anything you earn above ~£50k of income you pay 40% tax on, earning the same as capital gains... still just 20%. And while I'm at it, a slight increase on business rates too, either only targeting big businesses or specifically excluding businesses under a certain size. PLUS the one-off big tax on energy giants.
https://www.oddschecker.com/politics/british-politics
> Good news for the rest of us is that most people don't take such a simplistic view
Oh yes because they’ve proven this time and again.
I dont like the tories, i think they are corrupt and incompetent. But they are likely to lower taxes because they have no other selling point.
Labour on the other hand…has no competence in generating growth. Their only plan is that of anyone without a plan: raise taxes. They say they wont but how else can they finance all they promise?
And given the lack of competence on both sides the most complex choice is voting for someone that lets me decide what i want to do with my money. Many folks are afraid of this level of freedom.
The simplistic notion that the government knows better wont fly with this over burdened tax payer.
Oh and those business rates. Guess you expect the government will hire you because that will be the only option if they keep raising them at this rate. Hopefully the NHS gets privatised so we get a relief soon.
Oh yes because they’ve proven this time and again.
I dont like the tories, i think they are corrupt and incompetent. But they are likely to lower taxes because they have no other selling point.
Labour on the other hand…has no competence in generating growth. Their only plan is that of anyone without a plan: raise taxes. They say they wont but how else can they finance all they promise?
And given the lack of competence on both sides the most complex choice is voting for someone that lets me decide what i want to do with my money. Many folks are afraid of this level of freedom.
The simplistic notion that the government knows better wont fly with this over burdened tax payer.
Oh and those business rates. Guess you expect the government will hire you because that will be the only option if they keep raising them at this rate. Hopefully the NHS gets privatised so we get a relief soon.
>They just have to sack rishi sunak.
Yeah, because getting rid of the last four Tory leaders has worked so well for them.
Yeah, because getting rid of the last four Tory leaders has worked so well for them.
They've been in power for over 13 years so they must be doing something right.
Mastering iterative upward failure.
Boris was a lovable clown who self imploded so badly that surely no one could be worse --> internally 'elected' replacement Liz Truss who lasted less time than a shelf cabbage after tanking economy --> Rishi Sunak.
I can't see as how anything has been done right since the UK started down the distracting BREXIT path that nobody particularly wanted in the first instance save for some kind of confounded "No, I double, double, dare you!" trigger moment.
Boris was a lovable clown who self imploded so badly that surely no one could be worse --> internally 'elected' replacement Liz Truss who lasted less time than a shelf cabbage after tanking economy --> Rishi Sunak.
I can't see as how anything has been done right since the UK started down the distracting BREXIT path that nobody particularly wanted in the first instance save for some kind of confounded "No, I double, double, dare you!" trigger moment.
52% of the electorate voted for Brexit, that's hardly 'no one'. As for nothing right being done, we've been dealing with a pandemic and a war which have cause an inflationary and energy crisis. But our economic growth in the same period has been higher than Germany and on Par with France, with much lower unemployment.
What have the disasters of Brexit been?
What have the disasters of Brexit been?
>What have the disasters of Brexit been?
Falling trade with the EU.
Increased red tape.
Lower investment and hence stagnating productivity.
Economic performance below pre-referendum trend.
Immigration at an all time high.
Falling trade with the EU.
Increased red tape.
Lower investment and hence stagnating productivity.
Economic performance below pre-referendum trend.
Immigration at an all time high.
Falling Trade with the EU and more red tape? And yet our economy is still growing and its been growing faster than Germany and at the same rate as France.
Unemployment is low and Employment is at record rates.
We've had productivity problems since the end of the war, the last two years arent any different.
Immigration that we can control now.
So I can literally see no problems.
We've had productivity problems since the end of the war, the last two years arent any different.
Immigration that we can control now.
So I can literally see no problems.
Tories will likely decrease the taxes they promised to decrease (or abolish) the last 13 of 13 years while themselves increasing the tax burdeon to the highest level in 60 years.
Honestly the Tories are fortunate that suckers are born every day and despite litterally doing things infront of peoples face every single day they still go out and shill that they are not doing that, wont do that and the other side are the ones doing it.
Honestly the Tories are fortunate that suckers are born every day and despite litterally doing things infront of peoples face every single day they still go out and shill that they are not doing that, wont do that and the other side are the ones doing it.
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Well, allegedly, it was a UK Prime Minister who once said [1] that there are three kinds of lies: lies, damned lies, and statistics. I personally disagree, but can't ignore the fun fact.
[1] https://en.wikipedia.org/wiki/Lies%2C_damned_lies%2C_and_sta...
[1] https://en.wikipedia.org/wiki/Lies%2C_damned_lies%2C_and_sta...
Lol
Cannot read the article but the title reminds me of the quote: `There are three kinds of lies: lies, damned lies, and statistics` [0]
[0] https://en.wikipedia.org/wiki/Lies,_damned_lies,_and_statist...
[0] https://en.wikipedia.org/wiki/Lies,_damned_lies,_and_statist...