New post just out: "Credibility Gaps" On what the Spring Statement tells us about Labour's next year in government. And why the government's attempts to prove economic credibility are now actively undermining that credibility. (£/free trial) open.substack.com/pub/samf/p/c... - ThreadSky

samfr.bsky.social • 20 days ago

New post just out:

"Credibility Gaps"

On what the Spring Statement tells us about Labour's next year in government.

And why the government's attempts to prove economic credibility are now actively undermining that credibility.

(£/free trial)

https://open.substack.com/pub/samf/p/credibility-gaps?r=72szy&utm_campaign=post&utm_medium=web&showWelcomeOnShare=true

Comments

bdpsmith.bsky.social•20 days ago

This chart is incredible, absolutely no attempt to learn from reality. . .

suhails.bsky.social•19 days ago

Surely it’s incredulity. Apple ai sucks, Apple auto completing sucks harder.

samfr.bsky.social•20 days ago

In the post I look at both Labour's political strategy - and why they're not doing tax rises now even though everyone knows they're coming.

And also what that means for their fiscal credibility with markets.

mandascott.bsky.social•20 days ago

Is their insane strategy *all* about appeasing vigilante bond markets? Because that doesn't seem like a clever route to a future that's worth leaving to the next generations.

stamps50.bsky.social•20 days ago

Personally I think that the whole ‘credibility’ thing is just an overdone story that doesn’t actually reflect what drives markets

mandascott.bsky.social•20 days ago

I truly can't think of any other reason why they're behaving the way they are, though... The government makes the money (or at least, that portion that isn't made by the banks). It's their job to invest in the economy and keep the money supply going. So why are they choosing not to?

stamps50.bsky.social•20 days ago

I agree it’s baffling. The only thing I can think of is that they must believe that to do otherwise would play badly with the media or some focus group data. But at worst those should be concerns for closer to elections!

mandascott.bsky.social•20 days ago

I previously had a theory that they were being run, glove puppet style, but a cabal of Daily Mail Commenters... but I'm not sure even they are this dense...

samfr.bsky.social•20 days ago

What was really striking about researching this post was the extent to which no one in the City believes the OBR forecast.

Yet reassuring the City is the whole point of the process.

walletzerosan.bsky.social•20 days ago

Same as "off balance sheet" being some kind of fix.
Guys, they know it is off balance sheet - they adjust their analysis of the Balance Sheet for it.
BS is BS.

jimob1.bsky.social•20 days ago

Fiscal rules are either a) so obvious as not to require a rule or b) political choices which can never be universal (hence they come around like London buses).

The current ones signal to markets that, if push comes to shove, the poor/economy will be sacrificed to protect gilts - cross of gold.

columnist.bsky.social•20 days ago

They’ve set themselves up for a very big problem if April 2 does not go well…

johnlappin.bsky.social•20 days ago

It all felt uniquely disconnected from the global situation. Both government and, well, an utterly farcical opposition. Yes it is an emergency statement though not for the reasons suggested.
Extraordinary OBR lifeline on growth.

johnlappin.bsky.social•20 days ago

Some of the official projections felt to me oddly reminiscent of the MPC not really wanting to incorporate gas prices properly into their thinking at the start of invasion of the rest of Ukraine
But weirdly the gilt market seemed to want to be calmed. (I know I shouldn't personify markets. Oh well.)

shane11.bsky.social•20 days ago

The problem is they seemingly aren’t willing to have the conversation with the country about Europe.

If they did they’d at least buy some time and goodwill whilst they sorted it, but instead we are just a little island looking desperately isolated hoping the bully doesn’t ask us for our lunch money

kuyvonbraun.bsky.social•20 days ago

US trade deal…

I’m telling you 🔥🇬🇧

thereal-dk.bsky.social•20 days ago

Arguably the point is less the accuracy of the forecasts than the constraint on spending and borrowing. Doesnt make the ridiculous last minute changes to fine tune the numbers any better though...

fromtherocks.bsky.social•20 days ago

It's a 'check the numbers add up'

Not a 'check the numbers are the right numbers' per se

andrewbgarner.bsky.social•20 days ago

Really interesting thank you. The really simple, obvious question you raise is why have two OBR forecasts a year but only one fiscal event?

dressuptomessup.bsky.social•20 days ago

I think the problem is, that we have an almost child-like electorate. Everyone knows the government only have one pot of income. Us.
So no political party is willing to admit tax rises for fear of pissing off the nation. Yet we still want more for our money but don't want to pay for it.

caxskye.bsky.social•20 days ago

Very little understanding needed to see that a massive gulf exists between intent/effect of Starmer/Reeves policies.
The effrontery is that in matters UK economy they sound seriously more incompetent/naive/unknowing than the Conservatives ever did.
Economic growth will not emerge from building.

theitsiegypsy.bsky.social•17 days ago

Sounded like a good read..the bit I could read for free on Substack.

leviathanwilde.bsky.social•19 days ago

Yes - and placing this spreadsheet version of “fiscal stability” above core values (eg wellbeing, equitability, sustainability) undermines their USP with potential Labour voters, & their effectiveness at tackling the real underlying root causes of social & economic issues.

https://bsky.app/profile/leviathanwilde.bsky.social/post/3lll6jit5p22d

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