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@carkawalakhatulistiwa

10 ай бұрын

0:44 what you can say that. This not communist socialist government

@carkawalakhatulistiwa

10 ай бұрын

11:53 if you don't have job. You can get UBI and gain work experience from working in government. so if you apply for work in a private company you already have 3 years of work experience.

What I find most striking about your analysis of what they were trying to do is that lowering wages was a feature not a failure. At this point, the scale of the damage they've caused is so huge that it is implausible that they'll ever be able to admit it to themselves; but there's an angry part of me that wants them to be made to see it.

@HerrSchaft007

10 ай бұрын

right now they can still easily blame covid for the circumstances. (and also can hide the negative effects of brexit with that explanation).

@ingenix1460

10 ай бұрын

Honestly at this point I'm convinced that the Elites are trying to usher in an era or Neo Feudalism, where the common man will have no choice but to shut up and accept what ever crumbs are thrown their way while the rich only get richer.

@martinhartecfc

10 ай бұрын

@@HerrSchaft007 I don't think they will get away with that. With Brexit, the transition period ending and the pandemic starting were less than a year apart (and the actual official exit was less than a month before the pandemic started!). It will take very careful studies to show that they are lying in blaming the pandemic for all of it. In contrast, austerity started 10 years before the pandemic. Disentangling the effects will be much easier.

@HerrSchaft007

10 ай бұрын

@@martinhartecfc Well I guess they get away with that unfortunately. Average people are not into academics and don't watch this channel e.g. .

@zenastronomy

10 ай бұрын

why would they admit it? short term gain in quarterly profits always trumps long term generational unprofitable investments. the house of lords and house of commons are all international capitalists. the uk is not their home. places like Monaco, Seychelles, Switzerland are where they live and educate their children.

Could one argue that Camerons Austerity measures, helped Brexit happen, by making times harder for common folk?

@sardendibs

10 ай бұрын

Without doubt. The hardship of the UK, partially stemming from austerity, was blamed on Bruxelles during the campaign. Remember, the UK only needed to “break free” to ”unleash” its potential. What was holding the UK back, it was claimed, was not austerity and the lack of investment, but the EU. Bruxelles was the scapegoat for the decline that was, at least in part, a result of austerity.

@MoneyMacro

10 ай бұрын

Yes there is actually an interesting study on that www.aeaweb.org/articles?fbclid=IwAR3JH9JR0KMqDnySUojv_zUfeBYaQhsJXe-vD8xeA8IWGeE9GS8oSinegRk&id=10.1257%2Faer.20181164

@ericcartmann

10 ай бұрын

The "decline" is due to mass immigration into the west. European Cultural Genocide Why does no one ever talk about Moral of the population when it comes to economic performance? Consider Pearl Habour Bombings.... After the USA was bombed by the Japanese, the GDP of America grew very fast very quickly GDP is a god that you cannot rely on nor should you GDP cannot go up forever, and you should allow GDP to gracefully fall. The planet will give out. The Culture will give out. Some one has to give to allow infinite GDP Growth. Canada has good "GDP Growth" due to lots of government spending yet the culture has been on a grand decline and housing is completely unaffordable and the native population is completely demoralized. What is good for "GDP" is not good for the average person. I do not trust an economist who places any value on "GDP Growth". Why not study the limit of what the GDP can be? Because there is a limit.

@ByronWWW

10 ай бұрын

​​@@ericcartmannyou should be looking at distribution wealth distribution. GDP is how much weath the country has, distribution is how much of that goes to different groups. Totally agree, the land of Canada should be returned to its original inhabitants and the European colonizers should go home.

@ericcartmann

10 ай бұрын

@@ByronWWW "GDP is the weath a country has" No its not. Look up the definition. GDP is "Gross Domestic Product" its an account of how much money is thrown around. Here's a simple way to increase GDP. You print money! Double the amount of coins and you will approximately double your GDP. Real GDP can still be manipulated too, all you need to do is overvalue some "assets" and trade them back and forth really quickly. If I have a rock and i manage to sell it to you for 100 billion dollars then that increased the real GDP. I can then sell you the rock back and then double the contribution. Literally nothing happened that exchange with the rock get Real GDP was increased Remember all you need from an economy is a place to live, food to eat, some community, and some fun things to do. These control freak economists come in and make everything about money. They destroy communities, they flood whats left with their communities with foreigners, they say what they like to do is bad for the "economy" and your "safety". They make everyone feel like shit. A worker who feels like shit does less productive work. An elite group is too concered about hacking numbers and lines and graphs and try to play god rather than actual figuring what makes people happy then they end up making everything worse. An economist would love an economy where everyone spends and indebts themselves as much as possible. Living in a box in the sky and never leaving only existing in a virtual reality where you buy non real things and real things like food and shelter take all your income. Economists hate mothers and children they are bad for GDP Economists love immigrants they're predominantly male, disrupt communities, provide competition for worker wages/homes/food/women, and desperate for any pay of any kind.

I don't even understand one of the two expansionary austerity theory mechanisms. So if people get fired from the government, wages fall, which is good for companies. But in what world would that make these companies invest more?? They would not invest because, due to that increase in unemployment, aggregate demand fell. With less demand for goods and services, where the hell would they invest?

@joaocustodio7705

10 ай бұрын

Seems like what happened with Covid, when there was QT that went straight to share repurchases and almost no real investment.

@giansideros

10 ай бұрын

Also low wages discourage capital investment, it's why they dig up new roads in India with shovels whilst they use machinery in the UK. Capital is meant to mitigate labour costs, it's superfluous to risk capital investment in the face of declining real terms wages.

@rungus24

10 ай бұрын

I think they thought employers would pay people to stand around, even if there's less demand for goods, and somehow we'd all be living in an economic Thatcherite paradise by now.

@nattygsbord

10 ай бұрын

The problem with supply side economics is that it is blind to one major flaw within capitalism. And that is that it doesn't matter if taxes are 0%, and if companies can borrow at 0% interest rates, and if wages are 0.00000001 dollars per hour. Companies will not invest and hire people and increase production unless they believe there is any future demand for their product.

@kubhlaikhan2015

10 ай бұрын

In CHINA or in PROPERTY PORTFOLIOS - pushing up rents and mortgages and sucking even more wealth out of the real economy. That's where. We are now at the point when no government can save this economy unless they intervene in the property market and force down prices - because property takes everything left after taxes. Not one party is talking about it, not even the small ones like Reform or the Greens. Why is that? Because they're all run or financed by property owning rentier capitalists.

Since these numbers are public can we already call this a scam? Maybe not the originial idea but the fact that after a while the Government should have seen that it was still "employing" the same amount of people but kept the consultant strategy instead of hiring proper civil servants.

@burlacuninel5981

10 ай бұрын

It is only a scam if they recognize it as such. That would be political suicide. Make no mistake, they knew what the outcome will be from the start.

@tomlxyz

10 ай бұрын

Calling everything a scam by default is not a good idea

@effexon

10 ай бұрын

not to mention other videos commented those consultants, surprise surprise managed to lobby and even intervene in legislation system as government was too dependent on them. so businesses got backdoor to legislation. + it also cost tons more than direct hiring.

@laurencefraser

10 ай бұрын

Privatisation of infrastructure typically has similar problems. Onetime boost to income from the sale, brief reduction in expense from not having to pay the workers... then the costs of regulating and managing the shenanigans of the private entities now running the services start adding up. Soon you're employing about the same number of people, for about the same cost... except they're not actually doing anything Productive and service quality has dropped (well, unless it was terrible to start with, political shenanigans can lead to that particular problem too). There are, of course, exceptions, but it's usually a case of 'this thing has been run into the ground so badly that a complete reset is needed'... and if it's privately owned, nationalisation is one of the ways to do that, while if it's state owned, privatization is one of the ways to do that, but they're not the Only way to achieve that result in either case.

@BigHenFor

10 ай бұрын

​@@tomlxyzSorry, but you need to read Cippola's Laws of Stupidity.

The expected spending boom didn't happen. Yeah, obviously. We crawled out of the recession having experienced the single biggest price hike and reduction in Sterling spending power I'd seen in my life up to that point. Prices didn't go down. They just stabilised for a while until COVID ushered in another marked price hike. We can't buy our way out of this. On the contrary, every time I see increases in prices, I tighten the purse strings, reduce frivolous spending to preference essentials, and save what I can for emergencies. They want us to spend to reinvigorate the economy? Their bank balances are larger than ours, they can lead by example.

@BigHenFor

10 ай бұрын

But that's the point - they never do, and never will. And Cwrla Mattei's book explains why? It is done not to balance budgets, but to discipline Labour and increase profits. The fallacy amongst voters that a nation's economy is like a person's, or a household's budget needs to die fast. It's the biggest lie ever that keeps giving Conservatives carte blanche to waste money thanking their donors by filling their wallets.

@sarahrosen4985

10 ай бұрын

If only the economists were held liable for their ivory tower theories being implemented.

@ByronWWW

10 ай бұрын

Think you're mistaken, interest rate rises are to cool down the economy, forcing you to tighten your purse strings is exactly the effect they want because in theory it will slow price increases as things become less affordable, but the next 5 years (at least) are gonna be painful and we'll all be worse off.

@RedbadofFrisia

10 ай бұрын

​@@sarahrosen4985not so much economists as politicians to blame here.

@tyczekp

10 ай бұрын

@@ByronWWWdon't want to be negative, but I don't think it will get any better in our lifetimes. We live in the best time that we are going to live in.

Every council have £100K a year consultants come in regularly and say they need to fire more lower level staff, the hypocrisy is blatant.

@thedualtransition6070

7 ай бұрын

Consultants should be banned from the public sector, they just piss away money and arrogant people who really don't know what they are talking about. Also, yet another way for the rich to eat at the government trough.

Small mistake alert. I sometimes say expansionary and sometimes expansive austerity in this video. The correct term is expansionary austerity.

@stnbch3025

10 ай бұрын

Still don't get why it's a paradox and not just a f00l's beliefs contradicting himself.

@MouldyCheesePie

10 ай бұрын

@@stnbch3025 ?

@alana8863

3 ай бұрын

The correct term is expensive austerity. It cost so many of us so much.

I've worked in quite a few different companies and every one has tried the same "we are too bloated, we're not cutting we're improving efficiency" I've never seen it improve anything it just gives the shareholders a short boost in profits and bonuses while the overall quality of work, products and services provided just drops. Everytime it happens i move on. It's a shame that the conservatives also tried the same technique but with critical services.

@nvelsen1975

10 ай бұрын

Sounds like you're part of the dead weight that needed cutting then, no wonder you find getting sent off each time is how it ends up. 👍

@DeanRTaylor

10 ай бұрын

@@nvelsen1975 your reading ability must be fairly low if you're unable to understand the meaning of, "i moved on".

@nvelsen1975

10 ай бұрын

@@DeanRTaylor Thanks for confirming you were in fact the problem.

@SK-kh2rs

10 ай бұрын

​@@DeanRTaylor😂 you done him there

@ArawnOfAnnwn

10 ай бұрын

@@nvelsen1975 😂😂😂

The problem is that now the UKs economy is in such terrible shape due to austerity the main opposition party who look almost garrenteed to win the next election are saying that they need to carry on with the austerity policies that made us soo poor because there isn’t enough money to reverse them

@personzorz

10 ай бұрын

And they're wrong. Money can be created or destroyed at will by the government

@Getmeouttahere762

10 ай бұрын

It's more to do with the fact they are scared at coming across as reckless with money which is what the Tories want to paint them as. Hopefully they can loosen up a little bit once in power

@praline2x

10 ай бұрын

But interest rates are rising. So if they were wrong to implement austerity during faking interest rates then at least holding budgets at 0 change would be the best response. Labour for all their failings are sometimes better at the detail of managing public services.

@Swordphobic

10 ай бұрын

They could raise the debt, but then they would be slammed hard by mainstream media.

@cristianion2056

10 ай бұрын

What austerity when we had covid? They overblown spending

Not massively borrowing when interest rates were low was a mistake.

@funbarsolaris2822

10 ай бұрын

As was pointed out at the time non stop by the left, what a pathetic country the UK has become, all this suffering and permanent damage was so easy to avoid it really is hard to believe

@ericcartmann

10 ай бұрын

Give it a couple years to actually make the call on that. Many many people are struggling with the loans they have taken out a couple years ago. Many high debt countries are going to start imploding this time next year once inflation rate falls and interest rate is reduced again. This is because the next time interest rates are reduced people will spending every last penny they have to get what scraps are left. It will be like a sick form of musical chairs except you get literally nothing. For Example, The Canadian immigration rate (which is required for the amount of spending the Canadian government does and now needs because of needing to pay for the interest on their loans) has created a 500k home deficit EVERY YEAR. Every year the deficit increases by 500000 homes. Canadians are going to be homeless soon. While the UK economy is "supposedly bad" hopefully all the foreigners from shits land will go off some where else. At least the Brits will have home.

@MouldyCheesePie

10 ай бұрын

@@ericcartmann The situation in Canada sounds dire. However not taking out loans when interest rates were low was objectively terrible, to implement austerity and cut all services even worse. Britain's debt wasn't even that bad at the time, around the same as America's as the video says. The big question to ask is where did the money go? From the austerity savings, the selling off of government buildings and services and from INCREASED taxes? According to the Private Eye, it has gone into the pockets of companies of which politicians had friends or family in. So essentially the taxpayer money has been taken. Also the state bought out the banks to save them, what happened to the ownership/profits from buying them out? So the taxpayer spent money to bail out banks, yet didn't get a share of the profits when the banks recovered? More missing money.

@somethinglikethat2176

10 ай бұрын

​@@ericcartmann the issue is that the market was willing to lend to the British government on a fixed rate of next to zero, in it's own currency. You are correct that many countries have gotten themselves into trouble with debt, however at that time conditions were very favourable for borrowing.

I worked in Higher Education In the 13 years of Tory rule and my pay was frozen for six of those years. With inflation it was effectively a pay cut.

@MouldyCheesePie

10 ай бұрын

It was a pay cut, it's just slyly different enough that you can't call it that.

@nvelsen1975

10 ай бұрын

Well, somebody has to sacrifice so we can have positions like 'professor of gender studies' of 'PHD studying the inherent moral inferiority of white people' and other extremely worthwhile extremely academically-credible positions that didn't exist in the past, but do exist now.

@robbailie5878

10 ай бұрын

I wwill let you into a secret. Most companies in the private sector don't give annual pay rises either.

@MouldyCheesePie

10 ай бұрын

@@robbailie5878 Most low skill jobs don't give rises but professional ones do.

@martyalexander5627

10 ай бұрын

I’m in the NHS. We’ve effectively had our salaries reduced by 1/3 over the past 10 years because of public sector pay freeze and inflation; we’ve secured a larger pay rise recently but given the rate of inflation it nowhere matches the salary we need and deserve. The NHS is losing staff to the private sector or to other countries which I believe is intentional so that the tories can at some point in the future privatise healthcare to the benefit of their allies in the private healthcare industry.

I knew austerity was a lie as soon as the Tories announced the first tax cut for bankers. They also ignored the fact that government departments are not isolated in their impact and cuts to welfare would directly lead to more illnesses and crime, putting more stress on the police and NHS. When will the people of Britain learn that the Tories dont have the country's interests at heart?

Why austerity doesn’t work: someone else’s spending is someone else’s income.

@esmeecampbell7396

10 ай бұрын

No spending less on shit you don't need is a valid mathematical way of saving money, whether a person or a Government. It is the WAY it was conducted which was what caused it to go wrong. Because political elites only have their best interests at heart and not the long term interests of the country.

@jaggmeeler2039

10 ай бұрын

No it isn’t. Economies do not work the same as household budgets. ‘saving’ public money just = less money in the real economy. It’s pointless. Austerity is a completely debunked course of action for economies in recession and the cons know this but it was not done for pragmatic reasons but ideological ones = shrinking the size of the state, reducing public services = more public money in private pockets. The austerity era has been a failure of the U.K. economy but an absolute success for the Tories and their backers - they have privatised many public services and state assets and handed over billions in public money to the rich and the markets

@esmeecampbell7396

10 ай бұрын

@@jaggmeeler2039 there's a limit to government borrowing, there's a limit to how much money spent on public services goes to pay and a limit to how much of that ends up in a highly mobile form being passed between businesses or how much gets locked away. Think about it in terms of a country of 100 people, if you employed 10 people and spent £10 per year doing so, you could still have bloat if you were spending hundreds on the buildings and equipment and stationery etc... You view point is simplistic to the point of childishness and if you persist in defending it we will all be able to see you're just a stubborn moron...

@rileynicholson2322

10 ай бұрын

​@@esmeecampbell7396why should governments care about saving money? They issue their own currency. The goals of government are not monetary or profit driven, but geopolitical and quality of life for citizens. Saving money is a stupid goal if you own the printer.

@esmeecampbell7396

10 ай бұрын

@@rileynicholson2322 Ah yes of course, everything is free and money isn't real. Damn you're so smart, if only you could just tell our politicians that they just need to tape down the "print money" button and the Royal Mint and give it out to everyone.... THAT'LL FIX EVERYTHING! Tell me have you heard of a place called...Zimbabwe or perhaps Weimar Germany?

And yet now neither of the main parties are pledging to reverse austerity and spend more, because of the damage spending less has done... People simply do not understand the benefits of government spending, and think govt debt is always catastrophic.

@j.s.t.6515

10 ай бұрын

Labor is, how stupid can the British public be, my gosh. Oh wait, yeah, the school thing, sorry about it 😂

@danielwebb8402

10 ай бұрын

But they haven't spent less. Factually, numerically. Public sector has been a larger share of our money every year since 2010 than any year from 97-07.

@glassmuxxic

10 ай бұрын

Because the main parties are lying to tell the public what they want to hear in the run up to an election. Labour aware, after the disaster of Corbyn and 2019, that they are weakest on public perception they love to raise taxes and piss money up the wall - though taxes are going up regardless of who wins the next election, question is just who pays. You don’t need to believe public debt is catastrophic to be suspicious of proposing a large debt-fuelled expansion in the current environment when compared to the 2010s. You risk learning the right lesson at the wrong time.

@silverhost9782

10 ай бұрын

​@@danielwebb8402It seems to me that the real issue is that there simply isn't enough money to pay for the many tendrils of the state, and that there hasn't been for decades. Funding continues to increase but requirements increase faster.

@j.s.t.6515

10 ай бұрын

@@danielwebb8402 a five second Google search could tell you that that's not true. It tops in 2010, and declines by 8 points by 2019, and then skyrockets with covid, (which the public sector wasn't prepared to combat efficiently for unknown magical reasons, I guess,) and is still high but obviously declining since. But yeah, surely you're right.

When, in your search for nuance, you end up at Kuwait as an example of austerity sometimes being a good idea. I think you've made a very strong point on why it's really never a good idea anywhere in the real world.

@JPKnapp-ro6xm

8 ай бұрын

And even then he only talks about what Kuwait could do, not what they have done. He doesn't have a single real-life example of how austerity made life better for most people.

Video came out 7 minutes ago and people are already upset at it even though it's a 12 minute video. Some people got very triggered by the title.

@saulofontoura

10 ай бұрын

Some people listen at 2x speed though

As an FYI with all this evidence to the contrary...Liz Truss was ready to slash the budget one more time just to drive home the point that Tories never admit to mistakes...they double down. She just said the quiet part out loud. That got her in hot water.

@LegalAutomation

10 ай бұрын

​​When "Austarity" was implemented in the UK, government debt to GDP was at 93.6%. As of 2020, government debt to GDP is 195.39%. Government spending is ABSOLUTELY a detriment to the UK economy. Even though government spending is still too high, what those poultry austerity cuts *did* do is prevent the UK from defaulting on its debt like Greece was required to do. Furthermore, government *spending* as a fraction of GDP in the UK was around 40.2% in 2007. In 2020 government spending as a fraction of GDP was at 53% and 2023 is expected to be around 45%. Where were the actual spending cuts and reduction in the size of government? By LITERAL NUMERIC DEFINITION from 2007 to present, the size of government in the UK has increased... Both from a debt standpoint as well as from a spending perspective. You literally cannot increase the size of government and then point to a few specific programs which have seen cuts and complain that "government cuts don't work!"

@scpatl4now

10 ай бұрын

@@LegalAutomation You neglect to take into account that the UK shrank for several quarters due to the pandemic, austerity, and BREXIT. If the economy shrinks, debt to GDP goes up. Austerity increased the debt because it caused the economy to shrink (in addition to several other bad moves by the government). The best way to shrink debt to GDP is to grow the economy. Cutting spending is the worst way to do that. You spend to facilitate growth. One unit of government spending is one unit plus multiplier of private sector income.

@nvelsen1975

10 ай бұрын

@@scpatl4now What's your source for the weird claim that austerity shrank the UK economy? And obviously: No coincidences like "Yes but look during this global crisis there was some austerity and the economy shrank! I decide to randomly blame austerity!!", only establishing a causal relationship counts.

@alana8863

3 ай бұрын

@@LegalAutomation I cannot recognise any of the figures you quote. They do not bear any resemblance to anything I've seen from any source.

Austerity did not work as announced, but it *did* work as intended

If there's a thing I learned from paying attention to politics is whenever a politician says let's cut some state jobs he actually means let's kick the public system a little more in order to rely more on the private sectors. And then on the long run the state ends up paying more and the tax payer receiving less in terms of quality of services. We have the example of the USA, yet European politicians haven't learnt a thing.

@williamchamberlain2263

10 ай бұрын

There's a guy in the US who goes around road safety barriers picking up all the things that contractors are screwing up on those life-critical systems just to save a few minutes on each job.

@paulocezar8833

10 ай бұрын

​@@williamchamberlain2263Steve the guard rail man

@mltiago

10 ай бұрын

Because there where successful in their real intent. Making money by privatizing everything.

@MouldyCheesePie

10 ай бұрын

@@mltiago They also have links and connections to most contractors when they hand over the deals, so it's actually giving money to their friends and themselves at the expense of the taxpayer. Source: The Private Eye.

@mltiago

10 ай бұрын

@@MouldyCheesePie for me, this kind of use of taxpayer money is slavery. Cyberpunk slavery.

The growth of poorly paid " mini-jobs" zero hours contracts etc. is a general problem across the developed world to a greater or lesser extent , depending on the local politics and labour laws. But in the UK where manufacturing industry has been in decline for decades teh problem is fairly extreme and a low productivity low wage services sector just doesn't cut it as a growth engine - let the " accidentally on purpose" crash landed telephone sanitisers in the Hitchikers Guide to the Galaxy be a warning to all policy makers.....

Conservative budget cuts at their finest.

2:20 - most that debt came about because the government bailed out the failing banks by....buying them The government kept trying to pretend this money went into thin air but they where actually entitled to the profits of some large banks and the income they where generating. The tories ruined Britain, they ramped up immigration when Britain had a weak labour market, They kept persisting with austerity whist interest rates where below inflation and kept that condition for over decade. Britain is now a nation of low incomes, swollen house prices, social disorder, cultural collapse and zombie businesses.

@abum4595

10 ай бұрын

if they had gone on a spending spree when rates were low we'd have even higher debt and interest payments now

@kubhlaikhan2015

10 ай бұрын

Its pointless blaming "the tories" when in fact every major party endorses exactly the same policies. All the cash they accumulate through higher interest rates, taxes, lower wages and the immigration of cheap labour is actually stolen and squandered. That is why austerity failed to do any good - because it went in their own pockets, their mates pockets, their sponsors pockets, into bank bailouts, tax rebates for internationals or billion pound handouts to foreign neonazi dictators. They are all fundamentally corrupt.

@MouldyCheesePie

10 ай бұрын

So what happened to the ownership/profits from the state owned banks? Was the profit all privatized? So the taxpayer spent money to bail out banks yet didn't get a share of the profits when the banks recovered? Yes insisting with austerity while interest rates were low was suicidal.

@joaocosta3374

10 ай бұрын

Migration was a way to punish you fir brexit. Wake up because you are being subverted by your elites.

@nvelsen1975

10 ай бұрын

@@MouldyCheesePie Most countries made a profit on their bank bailouts, so I suspect his argument is incorrect.

I sincerely believe Gordon Brown could have rescued our economy and it’s a real shame he got voted out before he had the chance to :(

@stevebeever2442

10 ай бұрын

The man was a complete moron that didn't have a clue

@thecrimsondragon9744

10 ай бұрын

He would at any rate do much better than the entire lot of clowns that came after him put together. Hopefully, now people realise quiet competence is far more important, where leadership and economic management are concerned, than hollow charisma.

@stevebeever2442

10 ай бұрын

@@thecrimsondragon9744 Yeah the clown that sold our gold reserves ( real money) for fake money at rock bottom prices and also announced to the world when he was dumping it. Then has the cheek to grin and brag about it in parliament. Am sure that crook would have been bloody fantastic. There is one reason and one reason only why we are a mess and that's criminals counterfeiting our currency.

@byunbaekhyun2283

9 ай бұрын

I blame the inconsistency and pragmatism of British people.

Brexit following austerity really hurt investement. It would be interesting to see how different things would be if either policy had not been followed, nevermind both.

@robbailie5878

10 ай бұрын

Except no one in government had or has the will to make Brexit work. Take corporation tax. Irelands sits well below the UK's. Are you telling me that the UK could not have matched Irelands? Instead they raise it to levels not seen in decades.

As a Brit, I'm both embarrased and ashamed of how far we've fallen in the past 15 years. It's almost as if at every level of strategic policy in the past 15 years; we;ve elected for the short term, narrow minded fix instead of looking outward, being global and making the most of what the UK (London) can offer. Brexit didn't quite help either.

@nattygsbord

10 ай бұрын

Britain have been badly runned since Thatcher. The warcriminal Tony Blair and his privatizations was no stunning success either. Gordon Brown piled up enormous amounts of debt. More debt than the country had in 1945 after 6 years of war fighting Hitler. Bogie eater Brown also abused his power to blackmailing Iceland. And he also sold off Englands gold reserve at a terribly bad price as Blairs minister of finance. Then came pig f**ker Cameron with his catastrophic, evil and painful austarity program. He lied and said that too much welfare spending had caused Britains national debt to go up to 200% - which was of course a lie. As I said earlier did this debt balloon spike up from from low up to 200% in just one year during the financial crisis. But telling the truth would make his class warfare against the poor unpopular tory voters if he had told him that ordinary people needs to suffer because rich bankers had screwed up and lost lots of money and now people had to pay higher taxes and accept ruining living condition after painful spending cuts. Teresa May had the peoples backing for a Brexit, but she was a remainer uninterested in Brexit. Labour also tried to sabotage Brexit as well - and so much so that many leftwing voters considered voting tory. And after seeing opinion polls did may get hubris and call for an extra election and made extremely awful campaign promises she hoped she could get away with - things that people would never accept otherwise. But she misjudged, that the election result didn't end up well for her. People were obviously not attracted to hardcore Tory economic policies, and to allow silly nonsense like fox hunting and allowing trade with ivory. Boris Johnson made many good things for Britain, but his strong lockdown was not good for British society. Liz Truss was however a disaster for England. She borrowed money for making tax cuts for the rich - and the poor are of course the ones who have to pay for this welfare handout to the rich. The increased debt have also led to higher interest rates and higher inflation that is also harming the British economy. So to me have almost every prime minister since Thatcher seemed like a disaster. Thatcher, Blair, Brown, Cameron and Truss have all been awful for the country. One could of course say that the downward trend of te British economy started already back in the 1860s when it began losing its place as the workshop of the world to USA and Germany that were pioneers in the 2nd industrial revolution powered by combustion engines, electricity, chemistry and cheap steel. British manufacturings role declined and banking and shipping goods on British ships worldwide for domestic and foreign customers took over instead and covered the bad state of British manufacturing.. so by the 1880s was Britain no longer the no1 industrial power in the world. And British industry have been bad ever since.

@malthusXIII-fo3ep

10 ай бұрын

NO money left in 2010...only mountains of debt costing £1 billion PER WEEK to service that debt.....since 2010. Thanks Labour.

@ooooooooooooooo55655

10 ай бұрын

@@malthusXIII-fo3epClueless

@seadkolasinac7220

9 ай бұрын

@@malthusXIII-fo3ep did you read that in the Daily Express?

@20ZZ20

6 ай бұрын

the UK can offer a lot more than London, that itself is narrowminded thinking

Met a Londoner on a visit to Canada a few weeks ago. I asked him what he found most different about Canada, compared to England. He said, you aren't in a state of crisis here.

@seadkolasinac7220

9 ай бұрын

eh...while the UK is obviously not doing well, I don't think it's necessarily that much worse than Canada. The average Canadian is suffering from the same things, inflation, ridiculous housing prices (the latter might even be worse in Canada than the UK).

I'd say Germany did experiment with this for quite a while, too, and the result is that the government is now hiring a bunch of expensive "consultants", just like in Britain. However, we do seem to be correcting our course now.

@kubhlaikhan2015

10 ай бұрын

LOL. Your course is being corrected by the deliberate destruction of your real economy. Were you asleep when they bombed the pipeline?

The flowchart that says how austerity could increase economy growth makes zero sense, since it implies that British investors are very wasteful and incompetent. It implies that, when British employers save money, from lower interest rates and wages, they just invest more with no extra investment opportunity. The Expansionary Austerity Theory is based on employer malinvestment.

I once remember seeing that inequality in Britain is actually one of the worst in Europe especially after covid. Whatever they're doing, it's not working

@dadthelad

6 ай бұрын

Oh, it is working. Your mistake is in thinking that this isn't actually their goal. It is working very very well, and is very cleverly designed. Same thing is happening all across the western world. The rich and powerful are not only growing their wealth and power, but they are growing it compared to the lower and middle classes.

In qatars' case, the jobs for all citizens is more of a welfare policy then bad goverment spending

In Denmark the government has been cutting budgets in the public sector by 2% every year for several years. This hasn't lead to the same effects as we see in Britain, so maybe there is something else going on?

@TAP7a

10 ай бұрын

Maybe slow changes are easier to adapt to than massive slashes in spending?

@bogrunberger

10 ай бұрын

@@TAP7a You're probably right. :)

@debbiegilmour6171

10 ай бұрын

How productive is the Danish economy?

@TAP7a

10 ай бұрын

@@debbiegilmour6171 very, they’re an enormously productive country. Higher GDP nominal per capita (as in value produced per person) than Australia, the Netherlands, Israel, Sweden, Canada, Germany, the UK, Japan, South Korea, Saudi Arabia, Russia, Brazil…. Only (non-microstate) economies more productive than Denmark are Luxembourg, Ireland (both of which are tax havens, distorting the figures), Norway, Switzerland, Singapore, Qatar (which has deliberately suppressed its population of citizens, another distortion), the US, and Iceland. I didn’t realise until looking up the figures just now just how unbelievably high above its weight the Danish economy punches

The economy is not like a machine that you can program at your whim and you get the desired results. It's not like where you have inputs and automatically you get the wishful outputs. The austerity measures or Politicians' economic planning won't respect their elected terms either.

@tokinsloff312

10 ай бұрын

This the fundamental flaw with economics as a field. Its theories are just mathematical models, which never seem to be properly verified, based on the flawed assumptions, such as that people always act rationally and in their own best interest. Economists and the politicians they influence want to believe that because they have mathematical formulae, their theories are equivalent to the laws of physics. In reality, economics is a social science that doesn't tries to ignore the actual human beings.

I feel you could have mentioned the effects of Brexit perhaps a bit more thoroughly as it's been a pretty significant macro driver there, with exports to Europe becoming quite a bit more difficult. How much of the decline might have been side-effects of Brexit compared to austerity measures?

@funbarsolaris2822

10 ай бұрын

Brexit happened because of austerity ruining Britain, that's what galvanised the low IQ, people are always more xenophobic when the economy is down the shtter

@supercellodude

10 ай бұрын

I think there are models that try to calculate how the UK might've performed had Brexit not occured. Certain statistical adjustments are made between data from comparable economies in Europe and events in the UK that had less to do with the changes Brexit wrought

@silverhost9782

10 ай бұрын

He doesn't know, no one does. Depending on your allegiances, Brexit is either the main driver of all the UKs problems or a non-factor entirely. I don't blame him for not wanting to speculate.

@Darkrezta

10 ай бұрын

@@silverhost9782 a non factor? I call bullshit for that. there must be some kind of effect of brexit to UK and depending on an allegiances shouldn't be relevant to that, except if the allegiance is being delusional

@silverhost9782

10 ай бұрын

@@Darkrezta Way to miss the point. The scale of the impact is impossible to know for sure, so he decided not to speculate. It's that simple

I can see similarities to my home country of Canada. Around the same time we had the Stephen Harper government in place that ran on a policy of balancing the budget. One of the last things he did while in power was to cut the Federal health transfer from 6% down to 3%. This cut resulted in the healthcare system being underfunded by $38 billion over 10 years. I hear people complain all the time about how our healthcare system is horrible and how they have to go to the US if they want faster treatment. Somehow they don't equate those long wait times with the severely underfunded healthcare system. If we just kept funding our healthcare at the previous amount, it would be FAR more equipped to handle something like a global pandemic, let alone the regular healthcare needs of a growing population.

@zackgravity7284

10 ай бұрын

Right wing policies in effect

@accessthemainframe4475

10 ай бұрын

Okay but the liberals have been in power for 8 years now and healthcare still sucks

@karenwang313

10 ай бұрын

It's really not as simple as that. The healthcare money comes from taxes, which are already high enough to begin with. Plus, that tax money has to be used for all the public services in the country, not just healthcare. The problem is, if you tax people too much, they will feel like they aren't earning enough for their labor and will either become apathetic or leave for the US. I'm an American and our healthcare system is an abomination too, just in another way lol.

@ericcartmann

10 ай бұрын

Trudeau was elected in 2015. Liberals need to start blaming themselves for causing cultural genocide of their local populations which is actually causing decline in their countries.

@ericcartmann

10 ай бұрын

2015 was around 8 years ago. Or is Heathcare a provincial thing? I mean Trudeau always loves directing blame to provinces / municipalities / or the world never to his own stupid liberal idealism.

The idea shouldn't be to cut government spending, but to cut bureaucracy. For example, it costs 2x as much for us to build infrastructure as our European counter parts. We obviously need infrastructure spending, but we need to lower it's costs. If the costs come from bureaucracy, that is a needless expense.

IMHO, today's policy makers don't see (or don't want to see) that nowadays investors and consumers won't really follow the trade-off decisions their reductionist models forecast; if money becomes cheaper, it won't necessarily be invested in physical assets, but rather in financial instruments or other forms of investing (luxury real estate, art, collectible cars, and so on); and even if a decision is made to spend, it may not be within the country - e.g. a new plant in Ireland or a trip to Croatia, as the policymakers would want.

@TimothyCHenderson

10 ай бұрын

Yes and no. The aggrandizement of one's consumption into luxury goods that don't inherently contribute to more economic activity beyond the manufacture and sale of that good as more money is brought it goes hand in hand with investment and always has, specifically for first gen entrepreneurs. They spend on expanding their business and in the trappings of wealth since one often motivates the other. As that wealth is passed on, it often results in less productive investments.

There is no such thing as "properly implemented austerity" because the branches of government that provide services to the population are also the ones with the least capacity to defend themselves from cuts. The branches that act as leeches on the government budget are typically privatized/outsourced services who already got their position from being politically well-connected and are never going to be the ones cut. So every time a government promises to "cut the fat" you know it will 100% be cutting health, security, education, transportation, etc.

@nattygsbord

10 ай бұрын

I know lots of useless fat my government could cut in our budget. We did double our spending on FRA (kind of Swedens NSA) which just spy on people and reading their emails despite they have not been suspected of commiting any crime. That would save 0.5 billion Euros which would be enough money to provide every Swede with free bus and train tickets for a year. Our corrupt government also built the worlds most expensive hospital (Nya Karolinska Sjukhuset) due to corruption, and with that 8 billion Euro malinvestment one could have paid for all healthcare people in Stockholm need for the coming 40 years. The motorway Förbifart Stockholm is another insanely expensive building project built only because of bribes and corruption like the hospital. This motorway project was inspected by government experts, which concluded that this road failed on all 3 criterias needed to be fulfilled before any road are being constructed with tax payer money in this country. It was deemed economically unprofitable, enviromentally harmful and it would create more traffic jams instead of reducing them. So it failed on all acounts, but the green party and social democrats and the rightwing parties rammed this project through anyways. One could have invested money in subways or other solutions instead... but no they wasted money on this dumb sh*t instead that cost 4 billion Euros - enough money to pay 110.000 nurse salaries for an entire year. I would also get rid of all tax deductions we give to rich people so they can hire a house maid to clean their home for them. I think it is disgusting that poor people have to see their tax money go to pay for Sh*t like this. Rich clean their own homes, or pay for it out of their own pocket. Wasting 3 billion Euros on garbage like this is inexcuseable. I also think that we can privatize our state TV that costs tax payers 0.8 billion Euros per year. With that money can we hire 20.000 nurses instead. Or buy more hospital beds. Or add more railway tracks to our underdimentioned railway system. Or we could use that money to hire more policemen. Sweden have the lowest number of nurses, hospital beds and policemen per capita in the EU so I think that such things should be prioritized over useless TV entertainment with sing along songs, cooking, and home interior tv shows. Such junk can the private sector show to people instead - if they happens to be interested in watching it. I do not regard such bullcrap to be important to society. And I think that local governments in Sweden are wasteful as well. They should focus on education, roads, elderlycare and healthcare. And not waste money on trying to attracting tourists and trying to get people from elsewhere to settle in the community by crazy marketing programs. Like filling an undergroud Cold war bunker with snow and turn it into a tunnel for skiing. Another commune in Sweden tried to attract people with using millions of tax payer money for redirecting waste heat from a steel plant and dump that heat into a lake so the water would be 4-5 degree celsius warmer so one could take a bath there... but it did turn out that this project was no success either. Other common examples are bath houses and sport arenas. Stockholm alone recently built a bunch of new football arenas so that it now got four of them for some reason. And Luleå in the far north of Sweden have spent many hundreds of millions of Euros to build a large air port in this sparesely populated part of Sweden, but it turned out that this airfield did not attract more visitors to the town so all that is left is an oversized airport that costs money to maintain. We have black people who get paid 10K per hour to hold a one hour seminar at schools telling youths how racist Sweden is while they pocket large sums of tax payer money from the government. We pay 5 billion Euros to the EU each year - which is just a total waste of money that could be better used by ourselves instead. And the 30 billions we get back mostly just come back as agricultural subsidies to rich landowners and distort the competion. It do more harm than good to get all that money back which is why all the 8 parties in the Swedish parliament wish to abolish it. We also pay a life time pension to our politicians after they have served for years in parliament. So instead of going back to work after politics, do our politicians just live off their pensions at tax payers expense. One far-left politician sat a short term in the Swedish parliament in the 1980s, and after that she retired and have not worked since then despite being in a working age for 3 decades.

I feel that the austerity measures were introduced more due to ingrained ideological beliefs than due to balanced economic analysis. As the Conservative party is funded by a number of wealthy individuals who believe that most people should struggle and live frugally while they don’t. So yes they did achieve their objective as most people are poorer and they have a cheaper labour force to exploit/ take advantage of .

Wow, really interesting and well made! Will definitely be watching more from this channel..

Can't believe people actually listened to Italians about managing the economy, isn't there a whole joke about it?

Not spending on education and training in trades/crafts etc. is a "tomorrow problem" that the UK has always solved with immigration , not spending on the health system is a now problem that hurts GDP massively if people can't work while waiting or die prematurely becasue of late treatment, on going excess deaths since COVID make that point clearly enough...

Austerity ruining the UK wasn't a bug. It was a feature. An easy way to shift wealth from the poor to the rich.

@barmybarmecide5390

10 ай бұрын

Tories just genuinely hate the idea of a big "nanny state" that helps people, no wealth transfer conspiracy needed

@shadeblackwolf1508

10 ай бұрын

@@barmybarmecide5390 "we cut essential services and give big contracts to useless companies of personal friends" is exactly the policy we've seen over the years. remember the licence for britain-eu ferries going to a company with no ferries? or the contracts for face masks to companies that were neither in manufactory or supply? or the renovation contracts for the "nightingale hospitals" that when delivered got no staff assigned to them? a million pounds in government contracts costs about 20k pounds in campaign donations.

@dantaylor9665

10 ай бұрын

@@barmybarmecide5390 They're perfectly happy with nanny state help for certain people. Tax free economic zones, massive pension budget (the elderly vote Tory), ending stamp duty in the middle of a pandemic helping house prices rise 10% on average a year (homeowners vote Tory), huge payouts for the furlough scheme which were higher for people with higher incomes, and absolutely nothing for the unemployed, students, or people in unstable/short term employment... They're perfectly happy to help certain people, even if it massively increases our debt, and drives inflationary pressures everyone has to pick up later...

@nvelsen1975

10 ай бұрын

@@barmybarmecide5390 So... explain why the Tories left the NHS mostly intact then, even though it's 100% socialism where everybody gets served no matter how pointless, useless or expensive the healthcare spending it involves is? You'd expect proponents of 'small state' to instantly shut the NHS down, privatise it wholesale overnight and bring in private health insurance as the main financial supporter. And as you saw in the video: Continued socialised medicine from the big nanny state has resulted in record-breaking waiting lists, because hypochrondriacs etc have the exact same acces as people who legit need healthcare.

@barmybarmecide5390

10 ай бұрын

@@dantaylor9665 I agree, I'm not saying that it's some rational, coherent policy they've planned out, all I'm saying is that Tories don't have to want money to act against poor people, they can do so on an ideological basis

The Economist had an article recently that said that the conservatives' education reforms have been a success (unlike other ones) and have markedly improved educational outcomes.

@MoneyMacro

10 ай бұрын

Interesting. Will look it up. Have mostly come across reports about the teacher shortages and schools running on their last legs. Edit: found it. Very interesting. Thanks for sharing! www.economist.com/britain/2023/07/13/the-strange-success-of-the-tories-schools-policy

@pritapp788

10 ай бұрын

You wouldn't think so based on how British people vote and perceive themselves in relation to the world... unless The Economist's metrics for success is just academic performance.

@MouldyCheesePie

10 ай бұрын

@@MoneyMacro I was listening to the UK radio 4 the other day and it stated that for education in the UK, the UK has gone up the charts in English and Maths, which was the main concern. However this has been at the detriment of other subjects.

@MouldyCheesePie

10 ай бұрын

@@pritapp788 Self-perception and longing for empire are not a measure of intelligence, more arrogance. You see the same with all countries that had empires like China, Iran, France, Russia, Turkey, and so on.

@TAP7a

10 ай бұрын

The key questions are a) which outcomes, and b) why are teachers still fleeing the profession in droves. Because making targets of perverse outcomes can make a perverse system seem like a success, such as by devaluing subjects outside of the core of maths and sciences by labelling them things like "Mickey Mouse" subjects (despite that reference being to one of the most successful corporate brand icons of all time...). Part of the health crisis comes from things like reducing PE in favour of more maths and sciences. Part of the breaking of society comes from reducing art, music, drama, D&T/workshop in favour of even more maths and sciences (And maybe Egnlish if the kids behaved themselves). As I said, perverse targets can conceal perverse systems with perverse outcomes.

How do you separate the results of austerity from things like Brexit? Because I'd imagine that leaving the EU made the UK a much less attractive (and more risky) investment opportunity. So even if austerity made it more attractive, Brexit could have had a larger opposite effect. And since there are such large variables in play, I don't think you can draw many conclusion on this, one way or another.

@ypey1

10 ай бұрын

Yep, that is what i was thinking… too much disturbing factors

@gwho

10 ай бұрын

Yep. Confounding factor

@miguel5785

10 ай бұрын

No Brexit referendum or agreement envisaged a reduction of government spending. That reduction is fundamentally due to austerity policies. So if we find that Britain suffered significant costs ("was ruined") due to worse public services, we can assume those costs are due to austerity. Of course austerity is set to fail almost always because, while not all government spending is good, the bulk of government spending in public services (infrastructures, security, courts, education, health...) prevents higher costs and improves productivity. If austerity were only about leaner management they wouldn't call it austerity, they would call it efficiency. They call it austerity when it is meant to cut not only fat, but also muscle.

@2639theboss

10 ай бұрын

1) There are plenty of places that have tried to literally or rhetorically push expansive austerity, and its been a failure in every one. Its just reality, austerity is not how you expand an economy and never has been. 2) The same government that pushed austerity was the one driving brexit. So regardless of confounding factors, the factors are all part of the same policy approach.

@MrJuanmarin99

10 ай бұрын

By looking at other countries that also applied.

You explain everything clearly! I'm not an economist, but thanks to your research I'm learning a lot!

It's not JUST austerity. It's the short term culture of annual budget setting 'business planning' which is paralysing the public services. It stopped any significant investment in developing staff and facilities. (it is also responsible for employing an army of 'business bureaucrats' who contribute nothing of value to the public service)

IfG has a graph that showed in government department HM Civil Servant cuts, were severe during the Cameron years, but returned to pre-Austerity levels after the pandemic.

Thank you for the video. Did you consider the effects of Brexit in investments and economic agents expectations?

Yeah, I agree. It was very well explained, and it matches my experience living in the UK. This is also anecdotal, but in the wake of 2008, I decided to go into finance. I'm sure there are better things I could have done with my maths degree, but too big to fail is one heck of a moral hazard. It nicely juxtaposes itself with your sponsor 😕

Austerity has never worked. Especially when paired with tax cuts for the top brackets and lowering services/funds for the poorest who re-invest by far the largest amount of income in their local economy. This is religiously motivated, not based on any rational economic behaviour.

Love your channel Joeri. It's great to have a youtuber teaching a discipline with actual academic credentials. I was wondering if you'd ever try to get Yanous Varoufakis on the channel? It's an interview I would most certainly watch from start to finish.

@davidanalyst671

10 ай бұрын

This channel lied so many timed in this video its unbelievable. Go google milton friedman and thomas sowell. When you realize what this video is saying is a lie, you have discovered the truth of economics.

Thank you for your presentation , I watched all of it .

"Reduce/eliminate government programs and they'll never notice us spending less. That could never trigger a spending trap! We're geniuses. Anyone else feeling the urge to lie under oath?"

In my personal opinion Austerity mesures pushed my bussines interest to lower wages thus redistrubuting wealth into bussines elite. This happened in Multiple countries pushed by IMF and EVERY time it led to weakenening of institutons and sharp decrease in QOL of commoners.

I appreciate content like this because it highlights different factors that impact the UK economic struggle. It is very easy at the moment to blame all of our woes on Brexit and look smug, rather than acknowledging that it is one of many factors that have compounded with other global events and made the impact on the UK far greater than it would otherwise have been. Successive governments, even back to Blair, have made short term decisions purely looking at the impact on budget deficits and being voted back in rather than the long term effect on the country as whole. If a government rejects ideas because they won't see the benefit for 10-20 years, rather than it being a good or bad idea, it highlights the short termism that comes from a fluctuating political system.

Austerity is basically like not maintaining your car and expecting all the problems to fix themselves and the value to go up. Don't invest in people, services and infrastructure and your economy's tyre will blow up on the motorway and it will crash in a big ball of flames!

This is a popular theme nowdays. This is a second or third video on this topic in last 15 days Edit: okay, this is more scientific compared to other videos. Kudos for that.

@stephenj5432

10 ай бұрын

yeah i noticed the same too

@rungus24

10 ай бұрын

Those of us who were really paying attention had been reading these same things since 2010. If I were old enough, I'd be able to say that the same arguments have been going around since about 1936.

I would really like an in depth exploration why Austerity keeps being trotted repeatedly out over a century now, and it never works.

@baronvonlimbourgh1716

10 ай бұрын

Ideology... and the ones with the power not wanting to pay for anything.

@TheWolfXCIX

10 ай бұрын

Because when the alternative fails it is far, far worse.

@jackdekraaij603

10 ай бұрын

Ah, but it does work... The result is exactly the desired outcome: * lower wages (for the general public) * lower interest / higher earnings and capital gains for the investors * less tax money spent on public services (for the general public, wealthy people who don't rely much on public services) The real question is: why do people keep voting against their own interests?

@anotheridiotontheinternet6136

10 ай бұрын

​@jackdekraaij603 because they are ignorant of this and fall for the more convincing campaigns. In the uk we're not educated politically or economically at all, which is very convenient for the current government to exploit. To avoid falling for demagogues, our education system would need to be reformed to teach students how to critically view everything in the media and how the state works, but that's to much to ask 🤷🏻‍♀️

@yw9113

5 ай бұрын

It didn't work in the UK did it

An excellent analysis. Britian's biggest problem is that all of our major parties, whatever they call themselves, are now Liberal parties committed to what they call a "free market". That means they are ideologically predisposed toward letting the rich do whatever the hell they like, forcing down worker rights, wages and conditions. They refuse to regulate inequality, invest in infrastructure or stop immigration (which is cheap labour) and they let foreign internationals get away with murder. When the rich got richer in the 19th century, surplus capital was invested in buildings, schools, roads, railways and bridges. Today, it is taken abroad or used to fuel property inflation - and hence that cash is stolen from the worker, borrower, rent payer and High Street. So ultimately this is not just about Cameron's faulty understanding of economics, it is about a self-serving political class that despises its own people.

Interesting video, i agree for the most part. However i believe comparing macroeconomic parameters for different countries does not necessarily represents how a policy performed in the long run, as country specific shocks (such as Brexit) might have had a much more significant impact, while the main driver for the other countries might be related to other issues; it would be interesting to see consider how the UK would have performed if other UK-specific shocks such as Brexit did not happen. It would also be interesting to ponder on how the policy would have performed if it was not poorly implemented. Lastly one could explore what would have happened if a keynesian view was adopted. Of course i am aware that we only have data about reality :) but this are a few things that popped in my mind.

Actually, I was quite surprised. While I generally agree with most of the stuff you say on this channel, or when I disagree I find your explanation superior, in this case I was surprised that Brexit (though a slow-grinding way in which the economy faltered and basically sputtered to death) was not considered. Surely, Austerity played a part. But wouldn't we have to also consider the impact of Brexit? I would be surprised to learn if Austerity did more harm than Brexit but I would also be keenly interested to know where my unlearned estimation went wrong.

@MoneyMacro

10 ай бұрын

Absolutely. But arguably austerity caused Brexit (tipped the scales) www.aeaweb.org/articles?fbclid=IwAR3JH9JR0KMqDnySUojv_zUfeBYaQhsJXe-vD8xeA8IWGeE9GS8oSinegRk&id=10.1257%2Faer.20181164

@zackgravity7284

10 ай бұрын

The Right have doomed this country

@madarab

10 ай бұрын

@@MoneyMacro That paper is a complete nonsense, the Brexit did happen BECAUSE OF THE MARKETING CAMPAIGN in the social media and the media in general, which was full of lies and made up numbers which were presented as facts. They promised people to stop migration and be completely independent entity and blamed all the UK problems on the EU. I was living in the UK back then and the amount of lies presented in the anti EU campaign was astonishing, that's why people switched their opinions because they knew nothing about the EU, Britain as a EU member was a subject to many exceptions, wasn't the part of the Schengen etc but people were lied and led to believe that migration and other problems were caused by the EU regulations and that switched their opinion. How it ended? Exactly the opposite, the Britain left the EU, in order to trade with the EU, they have to accept those regulations unilaterally and they also lost any way to influence them or have any exceptions from them since they have left the EU. Not to mention, the paper does not tell you that it did happen due to austerity but the paper says there is a correlation, not proven causality.

@ByronWWW

10 ай бұрын

Many of the reasons given for why UK should brexit were actually caused by austerity and blamed on Europe and immigration (nhs and education failing, lack of integration etc). Basicaly the government burning down the house and pointing the finger at a bogeyman so a gullible public who dont seem to be able to link causes and consequences believe whatever they say. Paying on peoples fears is a super effective advertising/propaganda strategy (Goebbels learnt a lot from american ad men!)

I bet Gen-Z are really thankful to George Osborne for creating such a bright future for their generation. Everything is now so much better thanks to Austerity - I'm sure Gen-Z will concur.

Austerity is the go to policy of the British Conservatives. They implemented it during the Great Depression and after WW2. As a noted economist (Milton Friedman?) said "austerity is like punching yourself in the face - it only feels good when you stop" Whatever they say austerity is about preserving the wealth of the already wealthy. With interest rates sometimes below 0% the post GFC environment was ideal for state investment. Economic arguments are irrelevant to people like Cameron and Osbourne - they are third line justification likely put together by consultants to justify state destruction and asset stripping benefiting "mates". The blatant corruption of the Torys under Johnson during Covid was just a redux of what occured under Major. Cameron's austerity has not been reversed it continues to this day.

Love your videos, man. Thanks for making them!

You have to spend money to make money. That's true for businesses and the government.

There's a reason why there are no countries in the world that are both rich and have small governments. State services are the framework upon which all economic growth is built.

@danielwebb8402

10 ай бұрын

UK government is >40% GDP. Not small.

@trottheblackdog

10 ай бұрын

That's complete bollox. Wealth is created in the private sector through trade, and governments tax it to pay for their services. Governments can only take wealth, they cannot create it.

@masterpepe3641

10 ай бұрын

@@trottheblackdogno its not, its basic econ 101. Without a good police force, companies will likely say “fuck that” and dip for a country which has a good police force. The basic framework of govt is required for any economic growth to occur(why anarchism will never work and why pure libertarians are complete morons). And larger govts are indeed the ones with the highest amount of capital(the US being chief) as thats where investment is the safest

@giansideros

10 ай бұрын

@@trottheblackdog Channel 4 is a state owned enterprise and generates profits for the exchequer on top of the taxes they're liable for as a for profit broadcast provider that does not receive any license fee money like the BBC does.

@LegalAutomation

10 ай бұрын

​​When "Austarity" was implemented in the UK, government debt to GDP was at 93.6%. As of 2020, government debt to GDP is 195.39%. Government spending is ABSOLUTELY a detriment to the UK economy. Even though government spending is still too high, what those poultry austerity cuts *did* do is prevent the UK from defaulting on its debt like Greece was required to do. Furthermore, government *spending* as a fraction of GDP in the UK was around 40.2% in 2007. In 2020 government spending as a fraction of GDP was at 53% and 2023 is expected to be around 45%. Where were the actual spending cuts and reduction in the size of government? By LITERAL NUMERIC DEFINITION from 2007 to present, the size of government in the UK has increased... Both from a debt standpoint as well as from a spending perspective. You literally cannot increase the size of government and then point to a few specific programs which have seen cuts and complain that "government cuts don't work!"

Don’t forget whilst Cameron & Osborne and the Conservative party was implementing policies that drove down working class peoples wages they was also implementing policies on the private rented housing sector which drove working class peoples rents through the roof. Section 24 income tax act AKA the tenant tax. It leaves landlords on high interest rate mortgages no other choice but to hike rents to remain profitable!

Meanwhile, these politicians gave themselves a pay rise every year

I do have to wonder how much COVID and leaving the eu magnified the down sides of austerity measures.

@jaydowg1914

9 ай бұрын

Leaving the EU seems to be just a massive waste of time considering how much backtracking there now is, just like tusk predicted

I'm not convinced that Expansive Austerity was the theory behind Cameron's policy. I'd be amazed if the real reason wasn't just the conservative ideal if a smaller state no matter what. Further more, health wasnt protected because it was "already under stress". It was protected because it would be politically unacceptable to cut it. Same for education.

@Loundsify

10 ай бұрын

I'm from the upper class and I want lower taxes mentality, even if children starve mentality is more likely.

@sankarchaya

10 ай бұрын

both can be true. anglophone conservatives prefer small government thinking so latch onto a theory which justifies low spending

@BiggusDiggusable

10 ай бұрын

@@sankarchaya True...I'd just never heard it mentioned as a underlying justification for austerity and I've followed the issue fairly closely for 13 years now

@BiggusDiggusable

10 ай бұрын

@@sankarchaya Incidentally...why did you specify anglophone conservatives?

@LiamBar2010

10 ай бұрын

More money for firms and less for workers doesn't help the economy, it hinders it by reducing the spending power of those workers. Spread a million pounds across the workforce and they'll spend or invest it; a millionaire may spend and invest a bit, but why bother? It's more economic to put it in an offshore tax haven, which has the additional effect of lowering tax revenue.

Austerity is one of those things that in theory sounds amazing, the basic concept is essentially “cut the fat off public services, save money, repay our debts an great healthier government expenditures” in theory that sounds amazing. In practice though it’s a disaster, and is one of the major reasons why the UK is in so much trouble right now. Our public services have been picked to the bone, our infrastructure investment is non existent. People are leaving the public sector in droves for the private sector as pay has stagnated leading to a brain drain. The government wastes money left and right on bullshit like that stupid barge and to top it all off they have created an economy that isn’t fit for purpose. The conservatives have destroyed the UK in the last 13 years, we are a laughing stock in world affairs, our economy is crashing, we have no houses, wages aren’t growing, food prices are increasing, the cost of basic essentials like heating are higher than ever and all because of an incompetent, talentless political class

Three things might be missing. The Conservatives did increase the proportion of state money going to pensioners, spending which isn't being invested in the future. And the UK still had a property price boom with property investment crowding out investment in other forms of capital. Austerity is meant to prevent zombie companies but maybe the property boom stopped the reallocation of capital. And finally Brexit probably delayed/destabilised a lot of capital investment in the period 16-21 ish at least.

Interesting video, Joeri. Still a few remarks that I have. First and foremost, when conducting a case study like Britain and talking about their economy, it seems crucial to address the ginormous shock that occurred simultaneously for Britain, namely Brexit. The predicted effects of Brexit would also point to serious problems for the government, higher debt (for example, dealing with bureaucratic problems of Brexit and the economic downfall) et cetera. In this analysis you have not disentangled these economic effects, and whilst I understand that disentangling this is highly tricky, I still feel quite uncomfortable accepting causality and therefore the conclusion. It seems like this had to be accounted for in the video, or that you include other countries to back up this relationship between poorly timed austerity and subsequent governmental problems. Basically, causality is hard to confidently establish in a country that has faced such a gigantic political-economic shock with a bitter economic aftertaste for years to come. Second, I think it would be a nice improvement if you don't use the same pictures or videos multiple times in the same video. I understand that it takes more time, perhaps time you want to use for actual research. However, it would seem much more professional to me. Examples in this video were the video of the motor cyclists or the ambulance. Third, you have pinned only comment of yourself, but your other comment has already drifted downward, which many may miss. Even though it is not a very important one in this case, I think it would still nice to always pin all of your original comments (not reactions to comments, of course) to your videos, as youtube at times pushes them fully to the bottom. Anyway, love the channel and I can't wait for the next video!

@Jack-kw7ov

10 ай бұрын

I understand this to an extent, but Brexit and the effects of it happened more than 10 years after austerity started, many of the issues that the UK was facing that can be attributed to austerity existed before Brexit, however it is true that Brexit has evidently had a large impact on the UK economy, argued by some as better or worse, it is certainly possible that Brexit may have accentuated the issues caused by 10 years of Austerity.

@MoneyMacro

10 ай бұрын

1. Arguably austerity caused Brexit. I ended up, with a heavy heart, scrapping this from the video because it opens up such a can of worms. Maybe in a future video. www.aeaweb.org/articles?fbclid=IwAR3JH9JR0KMqDnySUojv_zUfeBYaQhsJXe-vD8xeA8IWGeE9GS8oSinegRk&id=10.1257%2Faer.20181164 2. Point taken! :) 3. I can sadly only pin one single comment

@MrJuanmarin99

10 ай бұрын

​@@MoneyMacro Maybe the way to remove the Brexit effect was talking about expansive austerity applied to other countries and not focusing so much into the UK. But I know the source material was specifically about the UK.

@pigsnoutman

10 ай бұрын

​@@Jack-kw7ovcan you say austerity was causal over the financial crisis? If austerity was a key factor, then why do you see similar populist politics in the US

Has expansionary austerity ever worked? I read an awful lot of Paul Krugman and other economists post-2008 and I'm not sure I know of a single positive example. It kind of felt like the Austrians were horribly wrong about everything, tbh, to the point that it's hard to believe that their goal was ever to actually reduce debt or expand economies. It seemed like reduced wages and incredibly low inflation were their actual goals.

Very interesting analysis. Thank you.

I'm pretty sure there's something deeply wrong with the entire NHS. The UK spends roughly the same percentage of its GDP on NHS as France and Germany do. However, the healthcare in the UK is not just a little bit worse than in Germany, they are in entirely different leagues. There must be a massive inefficiency somewhere but for the life of me, I can't figure out where it is. Doctors say they aren't paid well, the same goes for Nurses and even the Admins. The UK doesn't have the "Big Pharma" as the US does. So, where is all the money going then? Maybe you should do a video about this mate.

Here in Brazil, we had austerity between 2015 and 2020. Basicaly caused an economic depression in a economy where growth reach easily 5% or even 7% under more keynesian governments. Since pandemy the things are changing and now the (not so) new government ended the hard austerity laws from 2016 and put a anticyclic fiscal control device in the place (during growth times, the governament had a maximum level of budget, larger than the riged roof from 2016. But in recession times, the govern can expend a lot more now)

@rutessian

10 ай бұрын

Complaining about a recession when taking austerity measures to reduce debt after years of a spending binge is like complaining about a headache the next day after an alcohol binge.

@saulofontoura

10 ай бұрын

So you’re just going to ignore the 14 million unemployed and massive economic crisis of 2014, after 13 years of “keynesean Governments”, whose initial success were pretty much based on commodity boom? Brazil is a very different society from the UK. The Brazilian state is actually bloated and to make matters worse, the “austerity” you describe did nothing to tackle that problem, they just did the bad part, which is cutting investment.

@vramos.invest

10 ай бұрын

And thanks to that, Brazil will experience inflationary times in the Future.

UK gdp per capita ppp is now less than the EU average according to the IMF. We can no longer consider the UK to be amongst the top tier economies of the world. It is worse than the US state of Alabama 😮

@silverhost9782

10 ай бұрын

It's only 500 less lol, and most of Europe's GDP per capita is lower than Alabamas. Yet still with better healthcare, life expectancy and overall quality of life. No need to be melodramatic about this stuff😐

@ethanwmonster9075

10 ай бұрын

worse considering taxation and relative purchasing power, food, gas prices etc. its a double ball buster of low median income coupled with high taxes and gas prices.

@DrakonPhD

10 ай бұрын

Almost all of Europe is lower then Mississippi's PPP, which includes cost for healthcare and cost of living. People in Europe are just poorer then the US in general.

You're explanation is well done on the difference between thoughts on spending and growth. The only thing I'd like to add is in order for cuts to be useful you have to cut in the correct places. Basically if you are employing a hundred people and fifty of them do nothing most of the time then you can get ride of them and not affect operations except in times of need. Then you can have some other system set up to fill the roles. That's on personal tools are another matter. For other stuff its not as cut and dry. Mindless cuts will not work and they have to have a very, very good understanding of the ramifications to understand what can be and what should not be.

0:00: The UK's education system lacks funding and teachers. 0:09: The NHS is collapsing with long waiting lists for hospital care. 0:17: The police and judicial system are overwhelmed, leading to increasing crime rates. 4:26: Reducing government employment and wages through austerity measures enabled businesses to pay workers less and invest more, leading to increased employment. 5:11: The UK government, under Cameron, implemented severe austerity measures to reduce government spending and stimulate economic growth. 6:05: Certain government sectors, such as the National Health Service and education, were protected from budget cuts. 8:59: The theory of expansionary austerity failed to lower interest rates and stimulate investment and consumption. 9:59: The austerity measures led to an increase in economic inequality in the UK. 10:38: The NHS and education departments were not spared from budget cuts, leading to their poor state. Recap by Tammy AI

Making me feel better as an American is hard, this made me feel great! Oh you Brits!

Austerity was the worst thing that government could have done. They could have invested in infrastructure at 0% interest. We will never get back what was lost.

@Millipede666

10 ай бұрын

Imagine how many solar panels, windfarms, and rail the UK could have built.

@TheWolfXCIX

10 ай бұрын

@@Millipede666 Bro we're literally wasting billions on a rail project as we speak, and have 27% of our energy generated by wind. What more could you want?

@stephengray1344

10 ай бұрын

@@TheWolfXCIX We've had about a decade where it's been impossible to build a new onshore wind farm in England (and possibly Wales), so there's a huge amount of extra wind capacity that could have been built. We've got one huge prestige rail project, rather than dozens of smaller local rail projects that would make a difference to loads of people. We've had changes to the feed in tariff that caused solar installation on rooftops to crash. Keynsian investment could very easily have got the UK out of the problems caused by the financial crisis, and in doing so might have prevented the feeling many communities had that they were being left behind which caused the Brexit referendum result (which simply exacerbated those problems).

@LaFacedera

10 ай бұрын

Governments have already benefited from low interests on their huge debts

@Millipede666

10 ай бұрын

@@TheWolfXCIX rail projects arent a waste. Also I would like 100% of energy from renewables.

You always explain it well!

so frustrating how badly they were allowed to gut public services and yet simultaneously allow the private sector in to extract profits - all whilst the public were being failed by a press that were more interested in talking about how labour leaders ate bacon sandwiches than discussing the major failings of government policy and how short sighted policy was setting us up for the reckoning we're now experiencing

FINALLY an economist that is grounded in real world numbers and isn't blinded by Friedman-style ideology.

Great video as always. However one more critical component is that the UK and also Japan are island nations which depends on imports of Food and Energy need to use Government debts to support a trade imbalance which rises dramatically during a recession as currency weakens. Also both Japan and UK have had a very long period like 20-30 years of currency devaluation yet must support the trade imbalance to ensure food security which I think is what has lead to Austerity in the UK and record debts in Japan.

@seadkolasinac7220

9 ай бұрын

Japan is far more dependent on food imports than the UK is, and food doesn't actually cost that much. I don't think this explains the UK's problems at all

@drscopeify

9 ай бұрын

@@seadkolasinac7220 The problem is that when you have high interest rates you need to avoid taking out more debt however food impacts cannot stop. and if you have a large trade imbalance its going to be painful which leads to austerity, basically cutting government spending in order to fund the trade imbalance that cannot be lowered as that trade is for food

Politics is philosophical. Cameron's interest in being austere was consistent with his core beliefs about governance irrespective of the circumstances.

Can you explain why an expectation of lower future taxes by market participants should lead to lower interest rates? AFAIK, higher tax countries, such as Denmark, don’t have higher interest rates. Higher tax often means better services, which often means more stable societies/economies, which should mean less risk to lenders to the state, which should mean lower interest rates.

In New Zealand, it is looking like we are probably going to vote back in this year the same austerity party who is the key reason for why our health, education, disability, housing affordability, even transport/traffic are still struggling with crises and still not caught up despite money spent on it by the subsequent government. I've likened those cuts since as witnessing services as like houses being hollowed out - it still looks like a house on the outside, but when you go in you realise the furniture and wallpapers are long gone and those in charge have started taking from the house foundations (while still marketing it as a house). Many services existed more in name and expectations while the loss of experience, knowledge, old processes gone without new ones being properly tested made it barely fit for purpose and not do the functions it is supposed to. Even in normal times it would still have taken a decade or two (health sector especially) to rebuild and reinvest what we had and could have maintained or incrementally decreased. When you hack at the foundations of a house it is only a matter of time before it breaks and often it just cascades at the same time. Unfortunately, damage and repurchasing costs are usually more than the cost of maintaining what's there. Subsequent work by the next government goes into the immediate emergency repairs and incremental re-purchasing to what it was. The urgency at that point only makes the supply becom expensive because there is now such a massive, entirely self manufactured demand. Then people wonder why things are still bad when the government is spending so much money - because the simple principle that maintainence is cheaper than creating from scratch. It takes so much more time and money to build and one day to destroy. Managements are put to task to spend incrementally and cut with all the freedom. The spending feels stupid because it is, you are buying back what you sold, now at a higher price. As a voter you don't feel like you are getting anything back while paying for it. Sure, covid and other macro events obviously have impacts but in systems terms, it mostly accelerated the breakdown of an already hollowed out system (one that was supposed to be stressed and stretched at normal times and already slowly breaking down). There is no amount of political will that could keep up with that kind of acceleration of stress. But people still want to vote the party that created so many issues we are still grappling with the effects of back in. Anyway, it is sad that we have gotten into this voting cycle of repurchasing things we got rid of and pretend that is investing in the future.

This just reveals how bad the structural problems of our massive modern economies are. There seems to be no economy in the world that is either economically, socially or environmentally sustainable.

@zackgravity7284

10 ай бұрын

This is the cause of right wing policies

@laurencefraser

10 ай бұрын

Ehh... I'll grant you none manging all of the above, but there are certainly some that manage at least one of those (at least until some idiot politician gets a Bright Idea, anyway.)

@joao.fenix1473

10 ай бұрын

​@zackgravity7284 oh yes because governments continually creating mixed economies to create a path to socialism ever since 1945 is 100% a right wing idea and it has 100% worked at everything.

@zackgravity7284

10 ай бұрын

@@joao.fenix1473 i dont understand what you are saying? Right wing policies are.responsible for the cost of living crisis

@ishanbhusal0177

10 ай бұрын

@@joao.fenix1473 Mixed economies donot exist to create a path towards socialism, they exist to prevent the path towards socialism. If Europe and the US didnot give these safety nets to the working class, the workers movements would have crushed the status quo with a violent revolution. On top of that, the soviet state was always ready to fuel any threat to the western status quo. The corporatocracy had to tread lightly because they knew the fate of Eastern Europe.

Even as a laymen it seems obvious to me that if you cap the wages of a portion of the population (public sector workers) and basically give them no pay rises for 10 years, there spending power would decrease, and they become less productive in the economy

There was no austerity, we were are spending exactly the same (inflation adjusted) on public spending as the graph shows at 0:57, it had gone down between 2007 to 2010 due to the crash and then back up. Also the GDP per capita has gone down because there are millions of immigrants on benefits.

First, I am not an economist. However, when I see a comparison of Britain versus the United States, I have to raise an eyebrow. Why wasn't the comparison against Germany, France or Ireland?

@jorda_n_

10 ай бұрын

As they are within the EU… maybe 🤔

@goldenghostinc

10 ай бұрын

I think it has more to do with that France and Germany also implemented some form of austerity, but less severe where as the USA didn't, so makes for a better comparison from the different sides of the scale (if my interpretation of the video is correct)

@broken_abi6973

10 ай бұрын

Because, similar European economies, like Germany or France, also implemented austerity and are not doing so well either. Ireland is a very specific case, because it works as a tax haven.

The problem is that most austerity programs cut on services and benefits provided instead of reducing bureaucracy and cutting on useless paper pushing and political jobs. Also, it's better to create more public service jobs and fill those spots with people currently on welfare (even if it means hiring them to clean streets, build roads and other activities that might not require much qualification or desirability for regular employers) or even force them to take courses while also hiring them after (or kicking them off welfare benefits if they refuse to cooperate, exception only made for people with health problems). There's a clear need for affordable physical workers, maybe even have public services like people to mow your lawn for minimum wage, for example. The problem is that policies are usually not properly implemented because political interests that don't benefit the majority of people or society as a whole are usually the ones that prevail.

@afgor1088

10 ай бұрын

there's this idea out there that the government wastes huge amount of money on bureaucracy and unnecessary jobs. it's false. running government only accounts for about 1% of expenditure. there is only so much red tape to cut before you start slicing into your fingers.

@scpatl4now

10 ай бұрын

There are many economists that say there should be a job guarantee for anyone that wants one. Pretty much what you describe

@TheSimArchitect

10 ай бұрын

@@scpatl4now Yes. Job guarantee should replace welfare. And if someone has behavior that makes them deliver negative productivity they must be dealt with accordingly. We should only help who want to be helped. If someone without a health problem *intentionally* disturbs other workers they should be kicked out without benefits and arrested if they commit acts of violence because they can't feed themselves or their families.

@effexon

10 ай бұрын

this is good point.... job market (private sector) is very picky and cycle dependent so people need to have something to do when no companies hire at the moment.... otherwise get bunch of people with medical and social problems costing way more for years without hope to recover back to job market in many cases.

@effexon

10 ай бұрын

@@scpatl4now this is interesting. why isnt it done? as kid I heard stories this was done pretty often in europe but not when Ive been alive. It's been this austerity daydream utopia with socialist/stimchecks for rich or wealthy upper middle class. It also helps status anxiety (real phenomenom especially poor and unemployed suffer, getting hard to do anything meaningful despite having benefits) and keeps daily life skills in check to look for higher income job.

Great video, would also be interesting to assess the idea of trickledown economics that has been widely propagated and implemented throughout the West…

11:44 the subtitles say the exact opposite of what Joeri said.

Austerity, Brexit, then the Truss budget fiasco - if the Tories can't be trusted in bringing economic growth, what is their purpose at all?

The argument breaks down for austerity when you notice that they say reducing spending will convince someone to do something. You can never prove that that is what will happen. On the other side, you can prove that removing one unit of government spending WILL reduce private sector income because when governments spend, there is only one place that spending can go...to the private economy. I always saw this (austerity) as a sham, and you would think that people who are supposed to be so smart would see that too. If the financial crisis of 2008 proved anything...it's that people do things that aren't particularly rational, and you cant expect that doing one thing will always get the behavior you expect.

Actually I do agree. I also said this, when I lived in the UK, and that was the reason that I left the UK. I also read that there were three audits of the British Parliament which found in their research that the austerity cuts by the Cameron government actually did hurt the economy. Thanks for this intereting and informative video :)