Comments by "Grim Affiliations" (@grimaffiliations3671) on "Why the UK Got Stuck in A Cycle of Decline" video.

It's bizarre that people think you can grow through austerity. You're literally strangling private sector finances when the gov taxes more than it spends
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@VincentRE79 Austerity failed at saving the government money, it has been costly financially and in real terms
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@VincentRE79 the financial markets have no power over a committed government. If they did, Japan would've collapsed a long time ago, as their finances have been vastly more offensive to the markets than anything the UK has ever attempted
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Countries that borrow in their own currency cant go bankrupt
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@VincentRE79 The liz truss situation was the market predicting higher rates due to the fall in the pounds exchange rate. If the government were committed to their reforms, they would have supported the pounds exchange rate against temporary speculation, just like Japan has been doing for decades. Because like i said, Japanese fiscal policy is far more offensive to the market than anything Truss did, and yet the market has failed miserably in pushing up their interest rates
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@BillyBobJoeSnr The key though is that all of the prophesies about hyperinflation and default have failed to materialize despite their unprecedented debt to gdp ratio. So the important takeaway is that this talk of the government being too broke to invest in its public services or implement its economic vision is hogwash that should not be taken seriously. Austerity has been a massive failure, not just because it has inflicted hunger poverty and decay on the people of the Uk, but also because it didn't even save money in the long run. Turns out when you're afraid to invest in the drivers of growth, you stagnate and tax revenues fall off a cliff, thus increasing your debt to gdp ratio. That's actually what happened in Japan, their debt levels got that high due to contractionary fiscal policy, not too much spending. The only lesson we should learn from Japan is that a monetarily sovereign and committed nation has the tools to pursue full employment without worrying about bond vigilantes or default. Its up to the government what they do with those tools
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@BillyBobJoeSnr Maybe so, but taking the lesson from them that a monetarily sovereign nation cannot go bankrupt is not the same as seeing them as an economic model to aspire to. Indeed, that realization is the best protection we have against Japanese style stagnation
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@xtc2v It's quite literally impossible for the private sector to net save without net spending from the government. If the government taxes back every thing it spends, this will force private sector balance sheets into deficit
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@VincentRE79 most debt is held domestically in the US and UK too. Besides, it still needs to be paid out no matter who owns it, so that isn't it either
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@VincentRE79 tonnes of debt isn't a problem when that debt is denominated in your own currency. The US rolled over 120 trillion dollars worth of it in 2021 alone. Debt levels as a share of gdp is more important, and with austerity, that ratio increases. Besides, when you borrow in your own currency, issuing debt at all is optional. You can spend without selling bonds
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The liz truss fiasco happened because of an uncommitted government. They could have supported the pound against short term speculation but didn't
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@terencemacsweeney3667 No, the market cannot overrule a sovereign government when it comes to interest rates. If they could, Japan would not have an interest rate around 0% given then their massive 250% debt to gdp ratio. We also would've seen much higher rates in countries like the US and Uk after 2008. The only risk is to exchange rates, but those moves are short lived and can easily be managed by a committed government. Argentina is in a different boat because it borrows heavily in foreign currencies, unlike the UK, US or Japan so default is a real risk for them
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@penderyn8794 more goal post moving. Bold predictions about their demise have failed miserably so now we've moved on to vague predictions about something going wrong in the future. Quite amusing
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@yugmathakkar4023 no it isn't. Going bankrupt isn't good
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@VincentRE79 No, they've been doing it for decades, right up until today
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@VincentRE79 starting to recover? what has that got to do with them not losing control of their interest rates? And how were they getting away with it when they weren't in a "recovery"?
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@VincentRE79 If one third is held overseas, the vast majority is held domestically. And Japan only got to own so much of their debt because of massive amounts of QE. So you're essentially suggesting the UK would be fine if they just bought up vast quantities of their own bonds. Not a very coherent argument
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