It appears from some of the comments below Andy Wightman's blog that some people far from learning the valid lessons of the 2007-09 crash are in fact still drawing the completely wrong and opposite conclusions. The bubble that eventually burst with such catastrophic consequences in 2007 was a direct result of boundless cheap credit flooding the property market. People, usually estate agents, banks and building societies, had the cheek to call these purchases investments as though there was some link to productivity when in fact all they were doing was pushing up house prices, increasing debt and removing demand from truly productive industries and services.
Alas, there is so much self interest tied up in maintaining the situation it would be political suicide for any government or aspiring government to address the problem. Make no mistake, there are very people with any real say in the matter who want to see house prices dropping. And the last thing in the world building societies and even builders want is a glut of new homes. We're stuck with it, and another financial disaster could be just round the corner as a consequence because the mountain of debt tied up in property hasn't just disappeared -- in fact, it's getting worse.
Yes, but when you talk about wrong conclusions, many people seem unwilling to join the dots all the way to the end;
The credit economy you mention came about because tax take was generated from the spending people did on credit. This is why public sector employment and services mushroomed on the back of casino banking. That is also why they are now no longer sustainable - they were golden eggs from the casino goose, and it has stopped laying.
Moreover, people acquire credit in part to top up earnings because earning capacity has been deflated by globalisation - which many are happy to complain in the abstract but blanche from complaining in it's actuality; mass labour migration.
Finally, house price inflation is driven by; a) people going BTL in flight from pensions Gordon Brown trashed specifically, and which are no longer sustainable generally b) the break up of the family unit and c) mass migration. Throughout the boom we had more houses per head than ever before but also the lowest ratio of heads per house.
In short, the credit boom did not happen in isolation, but because of unsustainable ways of living that noone wants to give up. So much of the carping about it is exactly like gunts bemoaning Vlad when it went pop, while wanting all that his lucre brought - and still having deluded expectations even after it all went bang.
Meanwhile, the moral argument around tax - in which i believe - is splintering for related reasons. Its one thing to ask people to contribute to the communal pot, its another to ask them to keep coughing up more to fund choices which are predictably and systemically unsustainable, and implicitly require others to pick up the tab. And this is before the wider problem of people feeling obliged to begin with. Many 'citizens of the world', brought up under modern wisdom, where their countryman do not deserve special favour over anyone else in the world (that being a racist idea, clearly), may well not feel any such obligation. As an aside, I recall reading some research that pointed out that high rates of tax and welfare map to homogeneous societies, and get lower with diversity. Hence Sweden, and hence the USA. We are moving across that continuum at a rate of knots.
The gap between welfare demand and supply has become irreconcilable a long time ago, with credit used to paper over it for a while and now clearly no longer a viable means of doing so (which is, of course, not stopping us amping it up again).
Society faces fundamental questions which it wants to ignore - sustainable welfare (if it is possible at all) demands personal choices that as a society we are not prepared to make. The same goes for affordable housing - I feel so sorry for the young who are priced out, but then again the old are plumping their nests because the young will not look after them as happens in other cultures (or in prior generations of ours). Then again, today's old ushered in the society which has brought that about.
Greeting about the banks in isolation is wilful delusion; self centred, deracinated, atomised, rights obsessed, all choices are equally valid, materialist, liberal society has produced it's inevitable consequences, at all levels from the individual to the institutional.
A bit too uncomfortable to dwell on though; hence, we have Russell Brand.
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Large parts of the article are immediately questionable;
"Then I looked at all tax reliefs for savings and investments of various sorts from ISAs, to capital gains tax allowances through to enterprise incentive schemes. These are all reliefs for those with investment income. This is an explicit subsidy to some people that seemed directly comparable with many benefits payments in that sense (alone, I stress), so they were included to.
After that I also looked at VAT exemptions on spending that is largely by those well off, which was that relating to private education and health. I could have included UK domestic transport too as much of this is a subsidy to commuters but decided not to: these things are, eventually subjective."
Quite apart from 'subsidies' being in this context a euphemism for caps on money the state coercively takes from people, and thus never in the same moral universe as payments it gives out to people, the measures listed pretty much all curtail the need for state spending elsewhere. So these things are not really very comparable at all.
