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Ask HN: What Is Happening in the UK?

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Re: Ask HN: What Is Happening in the UK?

#101

Post by Al-Khwarizmi »

cbeach wrote: post #33
steve_gh wrote: post #20

Earlier quoted context omitted.

Quite frankly, you are hugely privileged to be earning at that level. The median average salary in the UK is just under £26k. Also, when you are that income level, there are a number of tax benefits you can enjoy - for example the first £40k you put into your pension is before tax - so it effectively reduces your salary (for tax purposes) by £40k. SO if you are doing the sensible thing and putting money into a pensio…

Yes I do pay plenty into my pension. It's not my "privilege" to earn at that level. I was born into an average economic background. I worked really hard at school and university, and then over a period of seventeen years, I worked really hard in responsible jobs. If all people from average backgrounds took the attitude that only "privileged" people get good careers, then unfortunately it would be a self-fulfilling pr…

If you lived in a dysfunctional country without public services, you wouldn't have been able to do all that, though.

You took more benefit from the system than others, regardless of whether it's by merit, it still makes sense that you pay more back.

Re: Ask HN: What Is Happening in the UK?

#102

Post by stephen_g »

hunglee2 wrote: post #24

In simple terms, the Bank of England and UK Gov are pursuing conflicting economic policies, BoE trying to take money out of circulation through hiking up interest rates, whilst UK Gov is putting money into circulation by proposing massive debt funded tax cuts. The obvious incoherency of this then led to the markets losing confidence in the UK economy, crashing the value of the pound, which in turn makes the planned U…

The crashing of the pound doesn’t make the tax cut more expensive - the UK doesn’t borrow in foreign currencies. They only issue bonds in pound sterling, and the tax cut is in their own currency, so it doesn’t really change things.

Not to say the tax cut is not a terrible idea - it’s absolute stupidity.

Re: Ask HN: What Is Happening in the UK?

#103

Post by caoilte »

marksbrown wrote: post #61
tut-urut-utut wrote: post #38

Earlier quoted context omitted.

Well, Truss was not elected because of her economic (or any other) competence, but because of her hardliner course against Russia. Rishi Sunak was a better choice in every category, but had two problems: 1. he is not "white" 2. he is not anti-Russian enough EDIT: By "elected" I meant "elected by her own party".

I won't deny the UK doesn't have issues with race but it is not the US. Here class politics matter far more. Electing a multimillionaire married to a billionaire was never going to end well electorally.

You forget the voterbase for choosing the Conservative Party leader. Conservative Party members skew older, whiter and more racist than the general public. Although in this case being the man who defenestrated Johnson didn't help his chances.

Re: Ask HN: What Is Happening in the UK?

#105

Post by ceejayoz »

roenxi wrote: post #96
ceejayoz wrote: post #43

Earlier quoted context omitted.

Not paying off all the debt and defaulting on debt are vastly different things.

Are you potentially not a creditor? I think the term here is 'distinction without a difference'. If you lend the US enough money for a sandwich, you should expect not to get a sandwichworth of money back. What you call that legally is not that interesting, I suspect, to the people were lending the money.

The creditors all get paid. The US has always made its debt payments.

New loans get taken out while that happens.

Non-$0 debt load, but no defaults. The only time the US ever paid off “all its debt” was during 1835-1836. One year out of more than 200.

Re: Ask HN: What Is Happening in the UK?

#106

Post by Brakenshire »

pyb wrote: post #84
tut-urut-utut wrote: post #38

Earlier quoted context omitted.

Well, Truss was not elected because of her economic (or any other) competence, but because of her hardliner course against Russia. Rishi Sunak was a better choice in every category, but had two problems: 1. he is not "white" 2. he is not anti-Russian enough EDIT: By "elected" I meant "elected by her own party".

I think the reason Rishi didn't sway Conservative party members is mostly 1., But you're not supposed to say it out loud. Truss was very much a nonentity until last month

The most popular candidate with the party members was Kemi Badenoch, a black woman, so it doesn’t seem credible that people voted against Rishi Sunak mostly because of race.

Re: Ask HN: What Is Happening in the UK?

#107

Post by chimprich »

cbeach wrote: post #3

The pound is low against the dollar, as is the Euro low against the dollar. The pound dropped in value a few days ago, but the price has recovered since then. The media chooses to focus on the drop rather than the recovery, because the drop coincided with a government announcement of some pro-growth economic policies that mainstream pundits disagree with. If you speak to people in the U.K. many would agree that payin…

> when income reaches £100K, there is a marginal tax rate of over 60% at that income level

Can't you just put that in your pension to avoid that effective 60% rate?

> no point in working long hours in a responsible job helping other people advance their careers if I keep less than 40p of every pound I earn at that point

I think the way the UK calculates tax at that level is a stupid way of setting it up, but "only" taking 40% of the 100k to 125k is hardly terrible. If you're in that range, you're incredibly well paid for the UK (or pretty much anywhere in the world).

I would personally like to pay more tax if it meant decent public services instead of people dying waiting for ambulances.

Re: Ask HN: What Is Happening in the UK?

#108

Post by mathieuh »

icare_1er wrote: post #72
smt88 wrote: post #25

Earlier quoted context omitted.

You're starting with an assumption that right-wing governments are good for economies. Let's ignore that dubious assumption and instead look at the actual policy. Truss's administration is giving tax cuts to the wealthy and paying for it by borrowing. The markets know that trickle-down economics is nonsense and these tax cuts won't boost UK's economy enough to cover the enormous amount of debt required to pay for the…

"Good for economies" does not mean much, and that's what distinguishes the left and the right. Usually, the right-wing, and the "markets", agree on what is good for the economy. It is quite unique to see the "markets" disagree so strongly with "the right". And it is also worth noting that it is quite rare to see left people use the view of Wall Street as an argument ! I remember many cases in Europe where socialists…

"I will never be ashamed of quoting a bad author as long as the line is good" – Seneca

Re: Ask HN: What Is Happening in the UK?

#109

Post by roenxi »

This question is ill-posed to the point where it doesn't have an answer. Every economic crisis people carefully step around the fact that phrases like 'economic crisis' or 'market melt down' don't mean anything and most of the people using the terms don't seem to think too hard about what the problem is.

Typically these slogans seem to mean that a politically significant number of people are losing their jobs, but simultaneously used as cover to print money and give it to the wealthy. But I don't think that is what is meant right now in the UK.

Re: Ask HN: What Is Happening in the UK?

#110

Post by rgblambda »

bjornsing wrote: post #39
pyb wrote: post #2

In a few words, PM Truss's first economic measures indicate that she's ideologically-driven and has no idea what she's doing. Namely, cutting taxes for the rich in hope that maybe some economic boost will "trickle-down" to the middle class and the poor. This idea is utterly discredited in economic circles. The UK central bank, the BoE, is forced to take measures to counteract what Truss and her government are doing !…

I think the old adage “correlation is not causation” applies somewhat. It’s probably true that the market got worried about the UKs ability to service its long term debt, but Truss’ announcement came in the middle of the worst bear market in bonds for well over a decade. Also, e.g. the Swedish crown (SEK) has lost about as much against the US dollar as the pound has, completely unrelated to Truss and her announcement…

Is it not the case that while the Swedish Crown is not officially pegged to the Euro in the same way that the Danish Krone is, it's value is heavily influenced by the Euro? The Euro's decline in value is down to investors moving their money to safer shores in the anticipation of energy shortages in Europe in the coming months.
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