Anyone who has ever read Charles Dickens’s David Copperfield is likely to remember this basic piece of economic advice from Mr. Micawber. Micawber was a financial disaster himself, but he understood something that seems to be beyond the Government:
“My other piece of advice, Copperfield,” said Mr. Micawber, “you know. Annual income 20 pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income 20 pounds, annual expenditure 20 pounds ought and six, result misery. The blossom is blighted, the leaf is withered, the god of day goes down upon the dreary scene, and — and in short you are forever floored. As I am!”
The U.K. Government, and that means this one and previous ones, is now stuck in the Dickensian misery of expenditure vastly exceeding income. The present Government has opted for tax rises to plug the gap and ignored the consequences for growth and employment.
Matthew Lynn in the Telegraph can only foresee a jobs bloodbath, and it’s starting at the retailer Next:
The trouble is, that is just the start of it. In reality the Rachel Reeves jobs bloodbath has only just begun – and it is about to get far worse over the next few months.
If the Chancellor thought companies could easily absorb the extra £24 billion in NI charges she is about to find out she was very much mistaken. The Retail Gazette reports today that Next is looking at automated scanners to replace till staff.
According to [Next’s] Chief Executive Simon Wolfson it is one of the few ways it can deal with the extra £67 million it will soon have to pay in higher employment taxes. “As we get natural turnover in our staff, where we introduce efficiencies, we will take on less new people rather than lose existing people,” he told the paper, explaining that Next would inevitably have to reduce its staffing numbers.
No one should kid themselves the company is doing that to improve customer service. The technology has been around for a decade or more, but most clothes retailers have ignored it, for the simple reason that customers don’t like self-scanners. Especially for buying clothes, we would rather deal with an actual person, and even the supermarkets have been getting rid of them.
Automation will lead to a collapse in employment and customer service:
A survey of the U.K. services sector last week by S&P Global found that firms were cutting back on staff numbers at the fastest rate in four years, while KPMG reported before Christmas that the number of vacancies is now falling at the fastest rate since the height of the pandemic.
As the new year unfolds, that will surely accelerate. Faced with a big rise in the tax they have to pay for each member of staff, firms will have no choice but to figure out ways of automating tasks that used to require actual people. Self-scanning will just be one part of it.
Worst of all, and this is where Mr. Micawber could step in with some handy pointers, the effect isn’t going to help Government spending either. It might increase it, while tax revenues remorselessly drop:
Every time a job is lost, the Government loses the NI, the income tax, the VAT on the money that person would have spent, and it may well have to start paying benefits as well.
Worth reading in full.
Stop Press: As if it couldn’t get worse, the Government is having to borrow more, so the pound has plunged. Still at least that means our exports will be cheaper. Hold on to your hats – it seems another tax raid could be looming:
The Treasury has held the biggest sale of five-year bonds in more than a decade as Rachel Reeves faces increasing pressure from rising borrowing costs.
The U.K. Debt Management Office (DMO) auctioned £4.25 billion of new debt a day after long-term Government borrowing costs surged to the highest level since 1998.
Five-year gilt yields have risen almost 35 basis points since the beginning of last month to around 4.45%, while 30-year yields are the highest in more than a quarter of a century.
The five-year gilts were sold by the DMO today with a yield of 4.49% – the return the Treasury promises to buyers of its debt.
Economists have warned that the Chancellor is on the brink of breaking her fiscal rules and being forced into another tax raid as bond yields rise.
You can read that story in full here.
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Or… (whisper it) spend less?
Labour don’t know how to spend less, they only know how to spend more. Buying votes is an expensive job.
Spend less of Other People’s Money?
Are you CRAZY?
(Supposed to be a response to sor)
Everything these appalling imbeciles and traitors do seems calculated to make us poorer and more miserable in our new low trust overtaxed over regulated country.
I see no way back from here.
Glad I moved out.
Same here, Jack. Cheers!
Total incompetence…not just Reeves but for decades. If my outgoings consistently exceeded my income I would be in deep trouble as I do not have access to a magic money tree.
Have I got this right? She’s borrowing money to be able to pay off the interest on money previously borrowed and spent?
…and she claims to be an economist?
Thank god it’s not a credit card financing the economy, because I don’t think she would be able to make the minimum payment each month and the card company would have to give her a ticking off. Oh hold on, she’s already been in trouble with credit cards hasn’t she
I don’t think she does anymore, to be fair
Hopefully no longer claims that. What happens when your “credit cards are all maxed out” anyway?
They print more money, start wars and fake pandemics.
I think even “Rachel from accounts” is wrong. At leastthe staff I used to manage could add up their accounts.
That’s what economists do.
Something I was reflecting on earlier this week. When I was a young lad, tens of thousands of men worked in coal mines, on the railways, heavy industry, the military etc etc. Some women worked as well, but in daintier jobs in shops for instance, but many were stay at home mothers working hard in homes. Today, the population has exploded, the massive employers have disappeared and those that still exist have far more automation than employees (even offices, like the banks where I started my working life have more machines than people). Nearly all women are now working. And yet, we are told we need to keep importing thousands of people to do the work. What work though? What are all these people doing, when so many jobs of the past no longer exist and more and more jobs of the present are disappearing?
Care work. Wiping elderly bottoms.
That is easily automated with the Microsoft WipeBot (TM). But seriously, foreign Big Tech will suck the national economy dry
Amazon delivery drivers.
Yes and they could afford to buy a home, raise kids, take them on holiday and have a wife at home.
Now even a couple both working can barely afford either a home or kids…
Join the dots…
Whitehall, local authorities, quangos ……
At the risk of repeating myself… Where is the MSM condemnation of the Starmer/Reeves bonkers budget, when they were so unanimous in their condemnation of the Truss/Kwarteng attempt to stimulate growth? Could it possibly be that the media are biased in favour of the Left?
Starmer and Reeves are using the old elite politics playbook. Old excuses and misdirection no longer work. The MSM are using the old elite political journalism playbook but old allegiances no longer hold. The international order is trying to hang on to the old elite authority playbook, but that is slipping rapidly.
Unfortunately the old elite is dying and a new elite playbook must be found – by someone.
Realistically what is going on?
Kneel has been put in place with orders to destroy the country and like a good little wannabe globalist he is working flat out to do exactly that and the starting point is to destroy the economic infrastructure. Once the country is bankrupt it can be sold piecemeal to the Blackrock brigade. A suitably impoverished nation, cold, hungry, unemployed, confused, poorly even will be much more amenable to UBI, Fifteen minute cities, CBDC and digital ID, all on the way to Agenda’s 2030 – “you will own nothing and be extremely firkin miserable.”
And for those that think my vision is far too grim let’s bear in mind what the ‘R Soles’ are debating today – should we have a full enquiry in to one of the greatest crimes ever perpetrated on the female children of this country and Kneel is ordering his puppets to vote ‘No.’
Clearly the hatred that Kneel feels for the working classes of this country is off the scale. He really, really detests us. No suggestion that a full enquiry into the Pakistani Rape Gangs is essential in order to clear the decks. Oh no. The only conclusion, the cover-up will be almost as great as the crimes of the Rape gangs ergo many facets of the state, including public figures such as Kneel are involved and thus guilty.
Those putting the collapse of the country down to Labour’s economic incompetence are missing the point. And the point is the collapse is deliberate.
Just so they can Build Back Better. The king must be so proud and I know he has our best interests!
I have just popped over to TCW and found this. Yes, we really are a despised people.
https://www.conservativewoman.co.uk/progressive-contempt-for-the-white-working-class/
“The depth of the contempt the white progressive managerial class has for the white working class is all too evident; their oikophobia is rampant. The primary responsibility for these horrific acts belongs to the mostly Pakistani Muslim perpetrators. Yet it was the weakness and systemic failures of those with responsibility for protecting their own girls which should make us angriest. For them progressive ideology, especially immigration and multiculturalism, was so important that it was worthwhile sacrificing tens of thousands of working-class white girls.
Ultimate responsibility lies with our politicians. These politicians are keen on punishing hate crimes. If there was ever a hate crime it was when groups of mainly Pakistani Muslims targeted vulnerable white girls on racial and religious grounds for industrial-scale rape and torture. These hate crimes were ignored.
These horrific crimes would not have been allowed to continue unabated if our politicians had not prioritised multiculturalism and vote gathering, a combination of progressive ideology and moral corruption. The white girls were simply the wrong victims, their suffering got in the way of the progressive narrative. If it had been Asian girls the story might have been different.
This scandal touched the whole of Britain, yet the current Labour government refuses to hold a national inquiry, as Laura Perrins wrote in TCW yesterday. It is to be left to local authorities with limited resources to investigate these crimes. One doesn’t need to be cynical to ask who is being protected and which voting bloc appeased.
It does the Conservative Party little good to try to assume the high moral ground and call for a national inquiry. They have just emerged from 14 years in power when they did nothing. The police would not have ignored these crimes without strong political backing and instruction.”
It makes harrowing reading. It makes me very angry.
Clearly the hatred that Kneel feels for the working classes of this country is off the scale. He really, really detests us.
This is the only reasonable conclusion that can be reached. The man is a complete and utter ‘see you next Tuesday’.
Thanks
Exactly nails and heads spring to mind, hey know exactly what they are doing and it ain’t pretty.
The next is what they call the going direct reset. No more pesky government middleman just straightforward direct corporate rule. To be fair you probably wouldn’t notice much difference in this country but it is even worse than the current horrorshow. No more obligations to protect pension funds or anything else. The jungle is bad but cages with electrified fences are far worse. You will be so distant from the centres of power that any attempt at resistance would require guile and ingenuity. As well as being healthy and well-fed and that is unlikely to be the case.
How else would you introduce Stakeholder Capitalism, straight from the WEF, this is what it’s all about.
Oh right so they are just fine with a Russian Oligarch or some Saudi Prince owning the club!
‘Elon Musk buying Liverpool would be a disaster – we won’t be part of his game of Monopoly’
It goes back over a hundred years to trends in thinking among the upper middle classes. Ideas of unconventional relationships, free love, the family as a furnace of oppression. All those literary figures proclaiming this. And they dabbled in free love and the rest but they kept their families strong as they knew that this is essential for survival. They just passed the filth down to the plebs undiluted and unconstrained in popular culture. Families began to feel like useless baggage. The cult of the self. They wanted to engender that sensation. And look at where we are now. There was a worldwide study conducted recently and forty percent of people who answered said that they did not have one meaningful relationship in their life. You might want to treat this as a big deal if you’re a real leader. You see what I mean.
Much of our export business is priced in overseas currency and much of it is not price elastic. Devaluation will likely increase the cost of imports while NOT increasing he total of exports.
Commodities are priced in dollars.
If the experts are priced in overseas currency, and our own currency is devalued, then we get more pounds for the dollars, yen or whatever that the foreigners spend on our exports. This is why a declining pound will increase exports.
By the way, the increased cost of imports will also deter them.
Overall then a decline in the pound will help our appalling trade deficit, although even after the recent falls, the pound is clearly well overvalued.
Stand by for the IMF to come knocking on the Princess of Theeves’ door.
Come back Dennis Healey, all is not forgiven.
https://www.youtube.com/watch?v=es7tbo8L3us
Three years later, enter The Lady stage right.
All’s well that begins badly.
I fear it will get a lot worse before Maggie is reincarnated.
Rachel from Accounts drones on about the damage that Liz Truss did to people’s mortgage repayments yet lo and behold she is using her stupidity to drive up the rate on 10 year bonds that sets mortgage rates. It is hard to anything she has done that will provide genuine growth given Labour will piss money away on Green bullshit. Many still think this is worthwhile and even John Redwood in a good article on how to turn things around still thought the was some Green stuff worth doing.
The tax increase might be the nail in the coffin, but I think Next’s decision to introduce self checkouts has more to do with the legal battle they lost which forces them to absurdly pay store staff the same as warehouse employees including back payments of more than £30m.
Rupert Lowe has put a Bill forward to stop government from using quantitative easing.
A masterstroke!!
But what chance does it have so morally bankrupt and so devoted to holding on to power at any cost the Labour majority would vote it through, just look at how they have traded the justice for raped and tortured little girls in order to hold on to their voting stock. They
have no morals nothing will get in the way of their will to control and dominate.
You may be right.
But voting against will highlight their unwillingness or inability to balance the books. As I said I think it is a masterstroke!
Right now they are doing the opposite – they have been selling bonds back into the markets. They seem to be under the insane delusion that they have some responsibility to “unwind” the quantitative easing that they have done.
But we continue to fund migrants, they receive benefits, free health care we pay for, free schooling we pay for, free housing we pay for legal costs, prison places it goes on. Remove all illegal migrants, Remove all non citizen prisoners, close the borders
Incentivise work and business rather than making the dole a lifestyle choice where money and benefits are paid out above a working wage, and for which there is no time limit, and no contribution such as community work expected.
Reduce by a minimum of 50% the headcount in clerical, managerial administrative jobs throughout the Public and civil service sector, get rid of all DEI they cause companies to DIE.
Open up the NHS to competition, remove the taxation on those who choose Private health care or schooling.
This at least would be a start and would be in tune with the majority of the population, but I guess Labour would classify it as being Far Right. Much better to let the country sink into a pit of depravity, violence and medieval fiefdom in the name of virtue signalling,
There is not one of these politicians that could run a large corporation. In fact most would not even be welcomed as a low level manager. Yet here they are suddenly and without training in charge of massive bureaucracies and budgets. I just don’t know why we expect it to work at all?
Matthew Lynn is one of my favourite journalists. He is wrong about only one thing here: it is a mistake to call it the “Rachel Reeves jobs bloodbath”.
Control of public spending was well and truly lost over 14 years of incompetent, mendacious, lazy and spendthrift Conservative government. Reeves and the current Labour government are only continuing where the Tories left off.
I am waiting for the jobs bloodbath in the medical world when all the official line Covid warriors are proved to have been wrong.
Long live the Galileans!
The rot started in 1945. The welfare State which we could never afford, is by popular demand, costing more and more, whilst the number of people who are doing jobs producing wealth become fewer and fewer and the parasite class grows.
Stop blaming Governments, blame the pan-banging public who want lots more free stuff – tons more spent on “our” NHS – paid for by the magic money tree and by fleecing the undeserving rich.