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globalised trade damages the lower classes in advanced economies

A very great deal of poor analysis is due to ignoring time frames. [ed]

"...convincing evidence that workers in the rich world suffered much more from the rise of China than economists thought was possible. In their most recent paper, published in January, they write that sudden exposure to foreign competition can depress wages and employment for at least a decade.

"Trade is beneficial in all sorts of ways. It provides consumers with goods they could not otherwise enjoy..."

But the advantages may (and sometimes do) take decades to appear.

"But those benefits are only visible after decades. In the short run, the same study found, America's gains from trade with China are minuscule. The heavy costs to those dependent on industries exposed to Chinese imports offset most of the benefits to consumers and to firms in less vulnerable industries. Economists' assumption that workers would easily adjust to the upheaval of trade seems to have been misplaced."

Fortunately President-elect Donald Trump appears far more experienced and sophisticated than Barack Obama.

    It is important that
  1. change is controlled;
  2. the position of the poor in an advanced country is considered, not just the planetary advantages of the poor.

Of course, that is very difficult for a cult international socialist like Barack Obama to understand and accept, and also to adjust. A cult international socialist, like Obama, is bound to put his religious (political) tastes before his fellow citizens. This is a major problem type with dogmatists and extremists.

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economism - the belief that economics is more important than people

It is essential to mitigate and even slow down globalisation in order to protect the life chances of the poorer and less able classes in the advanced societies.

Putting the less able western classes out of social integration undermines that integration and stirs up trouble for those societies. That is a serious cost in social capital.

There are limits to how fast societies can adjust.

It is not all about money.

The soul-less elites, such as socialists, have beliefs. Globalisation is an economic advantage if you ignore the effect on the poor and weak.

Soul-less elites 'think' like academics in their little technocrat boxes, without, understanding of the wider world and the real people.

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the tory government is now in huge surplus

For those being misled by politicians and media lies and innumeracy.

[All numbers are rather approximate.]

  • National debt : £1.64 trillion (90% of GDP)
  • Annual deficit : £19 billion (2% of GDP)

  • Current inflation rate : 7+%
  • GDP growth : 2.5%
  • Corrected inflation rate : 7.5% - 2.5% = 5%

Therefore, real national debt falls by 5% of £1.64 trillion
        = £80 billion.

£80 billion minus £20 billion [annual deficit, rounded] is a real surplus of £60 billion.

Meanwhile, Cameron et al. have so increased the credibility of the UK government that borrowing rates are now at an all time low, thus saving vast amounts of interest.

Vote for Corbyn and fascist (new politics) Labour and wreck the economy again. You know it makes sense.

And stop worrying about the pound, that's just more baloney.

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Patrick Minford on should Britain leave the EU?

56:56 mins

It is always a joy to watch a person who knows what he on about among all the blithering nonsense!

Patrick Minford's comments on PFIs (private finance initiative) are particularly interesting.


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uk economic situation now far better than commonly reported

The pound being at its lowest level since 1985 is part of sorting out the last Labour mess left by Brown the Clown.
At that time, they had driven inflation to around 25-30%.

It had taken David Cameron one year plus five in coalition to straighten their mess, and it is far from sorted.

If a country prints money while others do not, the currency of that country inevitably will fall over time, unless the country's real productivity rises at a similar rate.

A major reason the pound is not falling so much this time is that almost all the advanced world's central banks are systematically printing at similar rates.
Meanwhile, the Chinese are working for peanuts, thus driving down real prices.
It would be useful to realise that only a small percentage of most economies is trade related. Most of it is taking in each other's washing.

'New' Labour left the UK with a large pool of unemployed and pretendy employed. Now they are becoming counter inflationary as they are being 'encouraged' to work.

Issuing money to enable liquidity is not the same as issuing money to devalue.

Issuing for liquidity is, I understand, the alleged reason for the extra line of credit recently suggested by Bank of England Governor, Mark Carney.
However, the extra credit line he added was to enable the banks to loan.

The regular expansion of the money supply, which has been much practiced recently, continues, as far as I can see, as the world sleeps.
In contrast, this continual expansion is inflationary if the economy is not growing at a matching rate.

My latest estimate for UK inflation growth is approximately 4% p.a.

Using approximately 2015 figures, that would wipe around 68 billion off the real value of the national debt.
Further, the interest government is now paying is considerably down. That is, during his tenure, George Osborne has effectively wiped out the deficit this year.
In other words, Osborne made far more progress correcting the mess left by 'New ' Labour than most people realise.
The national debt (2016) is approximately £1.7 trillion and the deficit being about £60 billion.
This amounts to a payback of the national debt in real terms of about £8 billion or, as it is better expressed, a reduction of the GDP percentages.

Government can now borrow for the likes of infrastructure projects at very close to no interest! Meanwhile, the real spectre that stalks the money markets is deflation due to the growth of manufacturing and entry into world markets of the large populations of Asia. Serious and continuous deflation has not been seen for a hundred years, and, of course, people are not used to it. Meanwhile, fiat money is now the norm across the world.

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end notes

  1. Do not be confused - this deflation of prices is due to competition and the opening of markets. It is not the opposite of the inflation caused by money-printing by governments and central banks, referenced earlier in this article. These cheaper goods represent real falls in real prices.

    By printing money, governments keep these prices stable or rising. Thus, they reverse the effect the public would otherwise gain in cheaper goods, while increasing their revenue from a variety of taxes.

    It pays to keep this confusion in the public mind. This is possibly one reason why numeracy and economics are not taught adequately in government schools, if at all.

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