One of the most talked about issues in US politics is the US fiscal cliff. The fiscal cliff refers to the situation at the end of 2012, where a series of tax increases and spending cuts (worth $600bn) are due to come into force automatically. This amounts to This will reduce the budget deficit, but …
Casey B. Mulligan, from the University of Chicago suggests a theory for a major cause of the great recession and the rise in US unemployment post 2008. – Higher welfare payments. ..Redistribution, or subsidies and regulations intended to help the poor, unemployed, and financially distressed, have changed in many ways since the onset of the …
Readers Question. Can you explain why the Government and Economic Commentators are talking about a multiplier (in relation to budget cuts) of between 0.5 and 1, whereas I always thought that the GDP multiplier was bigger than this. Just to summarise a multiplier of 0.5 would mean fiscal consolidation (spending cuts) of £1bn, would lead …
According to the National Institute for Economic and Social Research (Niesr), fiscal consolidation in the UK is likely to increase the UK’s debt burden. Or to put it in layman’s terms there will be ‘pain, but no gain’ They model the impact of fiscal consolidation in both ‘normal’ times (scenario 1) and in the current …
Following on from previous posts – How much has government spending been cut – | How was budget deficit cut by 25%?. It will be useful to republish some data from Mainly Macro – on a post UK austerity and some facts UK Cyclically adjusted primary deficit 2010 2011 2012 2013 IMF 2 -6.1 -3.9 …
The government have repeatedly pointed to their ‘achievement’ of cutting the budget deficit by 25% in the past two years. But, how has this been achieved? and has it actually helped the UK economy? UK Net Borrowing 2007-08 £40.3bn 2008-09 £104.2bn 2009-10 £167.4bn 2010-11 £145.1bn 2011-12 £119.3bn 2012-13 £127.3bn – estimated This shows a 25% …
One feature of the current economic malaise is that growth predictions for the UK economy have been consistently over-optimistic. For example, the Office for Budget Responsibility originally forecast economic growth of 5.7% between 2010 to mid 2012. The economy failed to meet this target, growing by just 0.9% during this period. To be fair to …
A look at the changing profile of energy production in the UK. In the early 1960s, coal provided 81% of UK energy needs By 2010, this had fallen to 30%. At peak times in cold winters, coal use can increase to 40% of the UK’s electricity production. Despite a revival in coal production in the …