Energy Prices

[chrisp_1927]

Agree we've been fecked over big time by Truss and the ERG. Note green levy scrapped. Full steam ahead for climate change then.

Not sure it will make too big a difference. Seems like renewables are now the most cost effective solution anyway. They make commercial sense now even without subsidies.

[az city]

Great, something needed to be done, and it's been done.

I'm not 100% sure I'm fully up on what Truss has done. Here's what I gather has gone on.

As I understand it, Truss is borrowing GBP130B to fund the price cap. Of course, that borrowing will have to be paid back over the long-run through raising taxes. That will reduce aggregate demand and thus economic growth even further on Plague Island.

I also am led to believe that energy producers in the UK are expecting supra-normal profits of around GBP170B through the energy crisis. Of course, they won't just dole that huge sum out to their shareholders, they'll use it to invest and grow the UK economy a la trickledown (note to Jimbo - I'm being sarcastic).

Jimbo, I just don't see this as good news. GBP170B > GBP130B. And then there's the apparent abandonment of climate change objectives. This is appalling.

[Ninja]

You said "People on benefits will now suffer the most" That is absolutely not true. There is significantly more assistance for people on benefits, and rightly so.

Why (if not presumably for your own party political gain) would you spread mistruths like that? It just increases anxiety for people.

You keep implying that I am lying.
You've completely ignored my point that people on contributions based benefits get the total sum of ZERO extra per year.
What good is £650 a year if your annual energy bills have doubled?
In my house, my monthly energy bill will be somewhere around £200 per month this coming winter, I actually think it is likely to be a lot more as this is the calculation BEFORE the October price increase.
Let's say for argument's sake that it's £250 per month, and that's being reasonable.
That is already double what I was paying last year!

Now, let's say an extra £125 per month compared to last year.
If I was in receipt of UC and could get the £650, that would still be WAY short of the extra £1500 per year extra I am paying!

It's not rocket science is it? Just simple maths.
The fact cats lose nothing, the poor lose a lot.
It's not lies and I don't appreciate being called a liar by a blatant dyed in the wool Tory that will attempt desperately to defend the quite frankly inexcusable no matter what.

[Lither_1927]

We have been done , clearly

Your continual support of the Tories is fecking embarrassing, wind your next in

Lol rabid 😆

[JamesWales]

You keep implying that I am lying.
You've completely ignored my point that people on contributions based benefits get the total sum of ZERO extra per year.
What good is £650 a year if your annual energy bills have doubled?
In my house, my monthly energy bill will be somewhere around £200 per month this coming winter, I actually think it is likely to be a lot more as this is the calculation BEFORE the October price increase.
Let's say for argument's sake that it's £250 per month, and that's being reasonable.
That is already double what I was paying last year!

Now, let's say an extra £125 per month compared to last year.
If I was in receipt of UC and could get the £650, that would still be WAY short of the extra £1500 per year extra I am paying!

It's not rocket science is it? Just simple maths.
The fact cats lose nothing, the poor lose a lot.
It's not lies and I don't appreciate being called a liar by a blatant dyed in the wool Tory that will attempt desperately to defend the quite frankly inexcusable no matter what.

It's not that people will be better off than before the war in Ukraine or rises in energy prices.

The cause of the issue doesn't and hasn't gone away. The point is there is far more support for those on benefits than others, and people will be better off now than what we may have faced this time yesterday.

To say this: "People on benefits will now suffer the most" is fundamentally not true.

[superfeathers]

I can't understand why some are jumping for joy, were all gonna be paying even more when the new price cap sinks in.At the moment the cap is just under 2 grand so the money awarded to the most needy was based on an out of date cap so how anyone can think we'll be better off is wrong. If your really struggling now this does FA for you.

Im not jumping for joy, but it surely reduces everyones bills from what they could have been. I might be missing something but how does it do FA for people?
PS i am about as far from a tory as you can get.

[superfeathers]

Its fair to say that the poorest in society will suffer the most. Yes they will get slightly more help, but a doubling of the energy bill per month will hit poorest people more than say a middle income family who can most likely ride it out.

But surely the announcement today is an improvement on what it was.

[Vindec]

You make a good point and I do think that's the case. Many people though think of the rich as from inherited wealth or big business fat cats. In fact many who have made obscene amounts of money have done it because the likes of you and I are willing to spend our money to support them..be it pop stars, film stars....or football stars.

There is absolutely no point in saying anything remotely positive about the Conservative government on here. Had a Labour government done the same thing there would be widespread appreciation but anything positive done by the Tories will be met with negatives although there are some who maintain a more balanced view.

[Eric the Half a Bee]

Do we call all government borrowing a loan now? Isn't this what you wanted for the last decade to avoid austerity?

I'm curious that Labour's borrowing during the global economic downturn was described as "reckless" yet all Conservative borrowing, never is.

[Ninja]

There is absolutely no point in saying anything remotely positive about the Conservative government on here. Had a Labour government done the same thing there would be widespread appreciation but anything positive done by the Tories will be met with negatives although there are some who maintain a more balanced view.

I personally wouldn't be happy if labour did the same thing.
I don't care for either party, I hate politics and politicians with a passion. It's lies and deceit no matter who's in power.
However, what has been abundantly clear throughout my lifetime is the obvious.
The Tories support and help the rich while labour at least consider the poor.

[JamesWales]

I'm curious that Labour's borrowing during the global economic downturn was described as "reckless" yet all Conservative borrowing, never is.

Anyone who thinks all Labour borrowing was reckless and no Conservative borrowing ever is, is plainly a sectarian ideologue.

However, just like all Labour borrowing was certainly NOT bad, so too is not all COnservative borrowing, and the borrowing occuring here to (hopefully) stave off what may have been an absolute catastrophe is probably the right thing to do and provides some certainty to people over what we could have been facing.

[az city]

Anyone who thinks all Labour borrowing was reckless and no Conservative borrowing ever is, is plainly a sectarian ideologue.

However, just like all Labour borrowing was certainly NOT bad, so too is not all COnservative borrowing, and the borrowing occuring here to (hopefully) stave off what may have been an absolute catastrophe is probably the right thing to do and provides some certainty to people over what we could have been facing.

I see you've assiduously ignored the point I made about there not being any need to borrow above.

Explain why it doesn't make more sense to tax the excess profits of the energy generators rather than borrow to support the price cap.

[Lither_1927]

Plague Island.

Twerp lol

[splott parker]

There may be one less old age pension to fork out shortly, it may help.

[Vindec]

Explain why it doesn't make more sense to tax the excess profits of the energy generators rather than borrow to support the price cap.

I can't answer that but doubt anyone on here can. I'll have a go though but my understanding of the situation might be incorrect. My understanding is that the profits made by companies such as BP and Shell are earned globally and the excess profits won't fall to be taxed entirely in the UK. It was my further understanding that the £170bn profit, even if subject to a windfall tax applicable to the UK, would not generate anything like the sums required to pay for the level of government subsidy required. It seems to me that the noises made by the Labour front bench are disingenuous but the answer can only lie with the accountants of the companies concerned and HMRC.. Starmer and Co might be correct, and if they are, dismissing an additional windfall tax to the 65% these companies already pay, seems strange. But I suspect that Labour are playing politics with this as the profit generated by these companies will not be taxable in the UK.

[Ninja]

There may be one less old age pension to fork out shortly, it may help.

Nah.
You'll be paying for Charlie's jollies instead then, along with horse-face.

[splott parker]

Nah.
You'll be paying for Charlie's jollies instead then, along with horse-face.

I think we already are.

[Doucas]

https://www.walesonline.co.uk/news/u...rices-24954769

Highest prices in Europe.

[az city]

I can't answer that but doubt anyone on here can. I'll have a go though but my understanding of the situation might be incorrect. My understanding is that the profits made by companies such as BP and Shell are earned globally and the excess profits won't fall to be taxed entirely in the UK. It was my further understanding that the £170bn profit, even if subject to a windfall tax applicable to the UK, would not generate anything like the sums required to pay for the level of government subsidy required. It seems to me that the noises made by the Labour front bench are disingenuous but the answer can only lie with the accountants of the companies concerned and HMRC.. Starmer and Co might be correct, and if they are, dismissing an additional windfall tax to the 65% these companies already pay, seems strange. But I suspect that Labour are playing politics with this as the profit generated by these companies will not be taxable in the UK.

I don't think you are correct (note it's Bloomberg):

https://www.bloomberg.com/news/artic...uverify%20wall

I believe Truss wants to reduce the corporate tax rate because she's a believer in race-to-the-bottom (discredited) trickledown economics.

[dandywarhol]

It's the unit price which is capped.
Use more you pay more. Use less you pay less.
Energy has gone up 600 quid in October whilst the energy companies rack it in.
Even the likes of Shell energy who profess to be 100 % green charge the same price as the rest. The unit price for green energy has gone up 500%

[Dorcus]

If Truss didn't want to target help to the poorest in society because of ideological constraints then surely the least she could have done as a mere gesture would have been to have kept the energy cap at the same level as before instead of increasing it even further! Simples!

[Vindec]

I don't think you are correct (note it's Bloomberg):

https://www.bloomberg.com/news/artic...uverify%20wall

I believe Truss wants to reduce the corporate tax rate because she's a believer in race-to-the-bottom (discredited) trickledown economics.

Corporation tax won't be reduced for some time if ever; it's just that the planned rise probably won't take place but I agree the intention is probably to lower it even further. I also agree trickledown economics isn't the flavour of the month but in theory my view is that it makes a lot of sense. Tax businesses to oblivion and they will move elsewhere. Isn't that why we have so many French companies in the UK? In fact there are so many French people living in London they are represented by a French MP with London being the sixth largest French inhabited place on the planet with around 400000 residents.

I note the Bloomberg article but I believe some analysts I have heard on the radio were predicting a much lower tax take than Labour were forecasting and even the most optimistic forecasts will raise nowhere near enough to pay for the cost of the government intervention. It all helps I suppose but remain unconvinced that an additional windfall tax, over and above the 65% already payable, is not the panacea some claim it to be.

[JamesWales]

I'm not 100% sure I'm fully up on what Truss has done. Here's what I gather has gone on.

As I understand it, Truss is borrowing GBP130B to fund the price cap. Of course, that borrowing will have to be paid back over the long-run through raising taxes. That will reduce aggregate demand and thus economic growth even further on Plague Island.

I also am led to believe that energy producers in the UK are expecting supra-normal profits of around GBP170B through the energy crisis. Of course, they won't just dole that huge sum out to their shareholders, they'll use it to invest and grow the UK economy a la trickledown (note to Jimbo - I'm being sarcastic).

Jimbo, I just don't see this as good news. GBP170B > GBP130B. And then there's the apparent abandonment of climate change objectives. This is appalling.

You aren't very consistent Prof. This is what you said a few months ago about Britains borrowing debt. You seemed okay with it when it was something you supported (paying people to stay at home and lockdown the country etc) but less so when it's about subsidising peoples bills. In summary below, you said it's a "right wing trope" ( obvs! ) to complain about debt and repayments.

You even said it "never has to be repayed"

So do we take you seriously then, or now?

"First, UK austerity is now widely acknowledged to have been a huge own goal and a bust (cf Joe Stiglitz).

This "amazement" at borrowing and debt levels is one of the standard rightwing tropes that emerges from time to time before they slam the poor with austerity claiming it's about controlling public finances. For context, the UK's current GDP is around 3T. In your language that's GBP 3,000,000M. Does 17,400M GBP now seem that big? I think not.

A few other things that seem missing in your picture. The UK economy is not (as Thathcer said) like a household. The National Debt never has to be repaid. That is a crass oft-peddled misunderstanding of the macroeconomy. Debt has to be serviced sustainably to maintain confidence in the currency but the debt can revolve forever. Effectively it means the UK has to cover its interest payments so the ROW is confident it will continue to do so and carry on buying its debt instruments."

https://www.ccmb.co.uk/showthread.ph...90#post5256990

[az city]

You aren't very consistent Prof. This is what you said a few months ago about Britains borrowing debt. You seemed okay with it when it was something you supported (paying people to stay at home and lockdown the country etc) but less so when it's about subsidising peoples bills. In summary below, you said it's a "right wing trope" ( obvs! ) to complain about debt and repayments.

You even said it "never has to be repayed"

So do we take you seriously then, or now?

"First, UK austerity is now widely acknowledged to have been a huge own goal and a bust (cf Joe Stiglitz).

This "amazement" at borrowing and debt levels is one of the standard rightwing tropes that emerges from time to time before they slam the poor with austerity claiming it's about controlling public finances. For context, the UK's current GDP is around 3T. In your language that's GBP 3,000,000M. Does 17,400M GBP now seem that big? I think not.

A few other things that seem missing in your picture. The UK economy is not (as Thathcer said) like a household. The National Debt never has to be repaid. That is a crass oft-peddled misunderstanding of the macroeconomy. Debt has to be serviced sustainably to maintain confidence in the currency but the debt can revolve forever. Effectively it means the UK has to cover its interest payments so the ROW is confident it will continue to do so and carry on buying its debt instruments."

https://www.ccmb.co.uk/showthread.ph...90#post5256990

What third-rate college did you go to that didn't explain the difference servicing a debt and paying it off?

What exactly is "Britains (sic) borrowing debt"? Is there a non-borrowing debt? Never heard of it.

To summarize for you, Tory Boy, you clearly believe (based on your stance) it's better for taxpayers to cover the cost of Truss' energy cap than for it to come from the excess profits of the energy providers.

You haven't engaged with my points about the energy cap and borrowing.

[az city]

Corporation tax won't be reduced for some time if ever; it's just that the planned rise probably won't take place but I agree the intention is probably to lower it even further. I also agree trickledown economics isn't the flavour of the month but in theory my view is that it makes a lot of sense. Tax businesses to oblivion and they will move elsewhere. Isn't that why we have so many French companies in the UK? In fact there are so many French people living in London they are represented by a French MP with London being the sixth largest French inhabited place on the planet with around 400000 residents.

I note the Bloomberg article but I believe some analysts I have heard on the radio were predicting a much lower tax take than Labour were forecasting and even the most optimistic forecasts will raise nowhere near enough to pay for the cost of the government intervention. It all helps I suppose but remain unconvinced that an additional windfall tax, over and above the 65% already payable, is not the panacea some claim it to be.

Have you looked at the systematic evidence? Trickledown economics is totally discredited:

https://www.washingtonpost.com/busin...-trickle-down/

https://theconversation.com/footing-...wealthy-151945

I have it on good authority the estimated tax take the Treasury latterly decided to disown were actually worked up by the Treasury itself.