New conservaties

[123everton]

Is the Tory complaint about Labour's idea to sell of assets justified?
Given that they sold most everything in the 80s for a fraction of it's true value to fund tax cuts for the rich.

[Panic Button]

Or was it to help rebuild the country after the mess Labour left it in?

[jake-the-peg]

Yes and No.

Complaints against the sale are not justified as you point out such complaints would be the highest hypocrcy - You won't hear those from Top Tories.

Careful to distinguish complaints from the Tory Party with those of their friends in the press.

Complaints that this is a short term measure and will not have a significant effect on the defecit? - maybe but it's not claimed to be

The Tories own package only amounts to 7% of what is needed - nobody has yet put through a comprehensive set of figures.

As Tesco say Every little helps!

I'm pretty certain the Tories would do the same.

[kinell]

why not sell the (our) governments stake acquired recently in the banks?

now that things according to labour are looking up surely we should recoup all the bail out money and make a nice additional excess.......it was after all 'a good deal for britain'

[Gromit]

kinell

Because they would get a very low price if they could sell them at all at the moment. The banks are assets and they will be sold, but only when it is deemed the best price can for them.

The UK deficit is about £100bn - £70billion of that is our stakes in these banks. At some point these assets will be realised and we should get some of our money back. It would be foolish though to sell now.

[kinell]

Gromit

..ignore the irony

perhaps you have at your fingertips the current value of the shares that you say cost us £70Bn?

[rov1200]

Why doesn't Brown admit that his socialism policies have got this country into so much debt. He is forever trying to stretch the elastic band that creates more problems than it solves. As recognised selling these assets is a short term measure that will only slightly overcome the present credit deficit but the reasons for being in this mess will reoccur next year. If the social security budget is greater than either the defence or education budgets something must be going horribly wrong. Its a reduction in this handout society that needs to be tackled whether its the 10 million unemployed, the overgenerous tax allowances for middle classes or just overall spending thats got us in this mess. Sweeping it under the carpet for others to pick up the tabs won't do.

[Gromit]

rov1200

The vast majority of our deficit was spent on shoring up capitalist banks that got it so spectacularly wrong. The country has spent £70 billion (£3,000 for every one of us), saving these failed businesses. Not sure you can call that an act of socialism.

[Gromit]

kinell

This is from july. If we sold the £70 billion shares now, we would lose £11 billion. If we wait, we could even make a profit. The £100 billion deficit sounds a lot, but a large part of it is made from re-saleable assets, the only problem (for Labour and the Government) is that now is not the time to sell.

http://www.guardian.co.uk/business/2009/jul/13/lloyds-rbs-rescue-ukfinancialinstruments

[rov1200]

Gromit

When there is a fire in the kitchen you don't throw fat over it to put it out

[123everton]

The banks are the ones who got us into this mess, given the benefit of hindsight perhaps somebody has a better idea as to how the problem should've been dealt with?

[jno]

Im not sure there was a better way to handle the banking problem. Ordinarily a government would just let a failing company fail; but since virtually the whole population has money in banks, just letting them collapse could have been a disaster. The real problem was letting them get into such a mess in the first place. I believe that was a result of the Big Bang deregulation of the City of London - carried out by the well-known socialist Maggie Thatcher.

In fact, this pepped up the City so much that US banks pleaded to be allowed the same freedoms so they could compete. The Clinton administration said okay. It was the US financial institutions, now free to do what they liked, that then got into trouble, which washed across the Atlantic onto our shores. Maggie certainly changed the economy!

[Gromit]

rov1200

I don't understand your metaphor. There isn't a fire in the kitchen. Our debt, though huge, is currently under control and manageable, and there are plans afoot to reduce it.

There was no alternative to spending the £70 billion. At the best earliest possible moment, they will be privatised again and most of the £70 billion will be recouped.

Selling the £16 billion of assets is a desperate measure but preferable to severely cutting spending and raising income tax greatly, which will stifle the recovery. Cuts and tax rises will still be needed, but in tandem with £16 billion in asset sales will not have to be as drastic as the Conservatives plan.

[kinell]

with a population of c. 61.5M

a £70Bn bailout is ONLY £1138 and change each and a nice nestegg for a newborn

[Gromit]

Sorry kinell

That should have said £3000 for every household in the country.

[Aquagility]

Just go on printing money, then you won't have to sell anything.

[buildersmate]

But then the value of the pound will fail even further and none of us will be able to go to Magaluf on our holidays any more. What a dim idea.

[123everton]

Hello Buildersmate, I've also got a question in D.I.Y that you might be able to help me with.
Thanks.

[ABerrant]

jno - A significant part of problem was continuation of the status quo; kudos Blair/Brown. New Labour bought into the economic model, literally.

Hindsight is not necessary for those of us who despaired for decades at the unregulated economic reliance (nay Government promotion) of the credit culture thus allowing it to become the hideous monstrosity that sparked the banking crisis.

[123everton]

ABerrant, I agree about the continuation of status quo (I've had several arguments with Kromaracum about deregulating the banks) but I told you so is not going to buy the baby a bonnett.
Both main parties were largely in support of the policy (Tories would've deregulated further in their quest to "cut red tape") so given that both major parties were wrong about the banking system, given that globalised banking has brought problems to us all, once the banks went broke, what other cause of action would be preferable?
When the banks return to profit will the state recieve a dividend?

[ABerrant]

"I told you so" is as significant a statement to make as any other by a person (us aka the vast majority) not in a position to change the policy decisions of those in power, be they Red (aka Noo Purple), Blue (aka Noo Green) or any other hue.

"They" got us into this mess and "they" will either make the situation better, worse or no different.