So the UK chancellor Rishi Sunak is saying "Hard times are here"
What a load of nonsense!
Have people stopped eating, or have suddenly become unskilled?
No the real economy is just fine.
What has failed is that we still have Capitalism and we still need to bleed free wealth into the pockets of the rich at the same rate as before. Or perhaps an even greater rate if the government stupidly sells the public debt to the private sector.
Why not keep enabling demand through Q.E. at the tax payers expense, and collect taxes from tax payers as they rise to meet demand. What can go wrong?
Exactly capitalists never stop extracting rents, dividends and interest so while people and the economy is taking a well earned rest at the moment, the parasitic capitalists are still sucking blood out of the system at the usual rate hence the so called "issues".
What after all is Capitalism? Capital-ism is the system that protects and rewards "capital." And what is capital? Its just another word for wealth. So properly understood Capitalism is the system that protects and rewards wealth! Now its obvious what a fraud and insane system it is!
So why has any business folded recently? Exactly! the capitalists have sucked it dry over the last few months with rents and interest.
The proof of all this parasitism will be the vast increase in Capitalist wealth we will see as the economy shrinks to supply all that wealth.
Problem with our friend Sunak is his party (the Conservatives) is funded by Capitalists so he's unable to do anything right. "Protect our freebie income" the Capitalists are screaming at him, so he has no choice but to crash the real economy to supply their wishes. Stop voting Tory its what the ruling elite want!
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Now what can go wrong with this demand led, public economy? Importantly we lose the private financial sector at no cost what-so-ever. We might have more sympathy for them if they were not continuously dependent on the National Treasury for bailouts, and then go on to charge us interest on that debt. And we might have more sympathy for the private financial sector if it didn't make huge profits in the good times, and then huge profits in the bad times, while also asking for bailouts to protect them from the very risk that they are supposed to be managing. They take the risks, reap the benefits and when it goes wrong ask for Q.E. and bailouts. Enough. It is time to drive a stake through the useless banking and financial sectors.
Instead, since the tax payer and the Treasury prop the whole system up anyway, we just borrow from the Treasury. The government needs to enter the markets with interest free lending. Unlike the financial sector it has the law to demand repayments of debt in Taxes. And if they do charge interest, since it is Public that money goes back into the Treasury and is owned by the Tax payers, and what we do with it is voted for at election. Light years better than the current antiquated system that essentially just promotes the same aristocratic control of wealth we had in the Feudal System under the Normans.
So the Square Mile has collapsed without tax payer support and all the international capitalists have fled to countries whose tax payer does hand out freebies. An important fact: FTSE dividends alone equal the entire unemployment package in the UK. Put that in other terms: those wealthy enough to own shares in FTSE companies extract as much wealth from the UK economy as the unemployed! By removing the private financial sector we save huge amounts of dividend money that is ploughed instead back into the Treasury to help the tax payers!
And consider that UK Mortgages alone bleed 2.8% of GDP every year into the private banks. The UK economy is like a sieve with money leaking everywhere into the pockets of the ultra wealthy capitalists. Obviously there are small time capitalists like myself who own a pension and some shares but we benefit very little compared with the professional capitalists. We still need to work for an income is proof we are not true capitalists. 80% of wealth is owned by 20% of the people is a very, very conservative estimate. That means at least 80% of Capitalist returns fall into the hands of just 20%. I say at least cos its exponential. The more capital you have the more quickly your wealth increases: that is the Law of Capitalism. The opposite is the rule that us non-capitalists all understand well: the larger your debt the faster it increases.
So I have proposed that the Treasury keeps Q.E. like the "eat out to help out scheme" drawing people into restaurants to eat out, and subsidising 50% of the meal (up to £10 off). This is a fantastic innovation. It takes the tax payers money and directs it to restaurants and food. Perhaps restaurants are not that important but food is. I'm becoming a huge fan of Milton Friedman just removing the elitist capitalist element of his theories. He advocates "meal tickets" and this would have been a better system. But however the government does this the point is to fuel targetted parts of the economy like with any Q.E. But this is better than previous financial sector injections of wealth cos only the rich need the Financial Sector. If you do not have enough money to eat, you most certainly don't need a bank or stock broker. That is unless you borrow, but if you don't have enough to eat tomorrow, you most certainly won't have enough to eat AND pay back interest tomorrow. Banks are for the rich only, those who seek leverage to increase their assets.
Now what do people in the hospitality sector do when they are payed by the government scheme? They spend. This is "trickle along." Now "Trickle Along" works. "Trickle Down" economics was clearly invented as a joke by the rich against the poor. Yeah right. Make us even richer and the scraps under the table will increase. They must think we gullible as hell. All the more reason for just removing the private wealthy elites from the system. Trickle Along creates demand in other sectors, and because people in the hospitality sector are likely to live ordinary lives, they are not going to just blow the wind-fall on stock market speculation or buying up houses (already in short supply) to rent out. They will fuel the real people and real economy. So the economy keeps breathing, and the government claims some of this back in tax.
Does it add up? Well this this where Friedman comes in. If it doesn't and the government debt starts increasing you will get inflation. This could cause a problem cos as prices increase the government would then have to increase the Q.E. amounts. So you could end up with run away inflation. But the fall in the pound would make the UK an attractive investment opportunity for businesses. We are still talking private business, but not private money! So car manufacturers might move car plants to the UK cos the pound is so very cheap. But this is where democracy comes in. The UK population have a vote, and if we don't like the falling pound and rising prices (same thing essentially*) we can vote in a government that seeks to increase taxes and reduce spending and so reduce the debt burden.
But the beauty of this is that the economy is hermetically sealed. There is no leakage of free wealth to the rich just by virtue of them being rich. If the government creates a debt of $1b that remains on the books until it is returned. No selling into the private financial markets and then having to pay returns on Gilts (in US Treasuries). And no hyper inflating private financial sector with these debt purchases. No stupid derivatives betting market. None of this nonsense, no play ground for the rich, no absurd risks that the tax payer must bail out, and a stable productive economy.
It also means that suppose the population just gets tired of working and shopping. Perhaps they find a new enjoyment of family life and the beauty of nature. People would rather take a walk in the park than spend money to go to the gym. All the things that cost nothing and don't involve the economy. The economy would start to contract. In this Friedman view its a simple matter of the government taking money out of circulation. Clearing debt if it exists, and then just burning it. A clean way to shrink an economy to match the wishes of the people, rather than driving the people to always supply wealth for the rich.
Unfortunately at the moment the Capitalist driven economy needs growth to (1) encourage returns on investments (i.e. allow the rich to steal more) (2) pay back the existing debt that has been created in bailouts and other hyper-charging of the economy to attract investors and pay them their freebies. If the Planet is under threat it is not to do with population (there is plenty of room for us all) it is to do with this toxic economic system that seeks to line the pockets of the wealthy for free.
I respect David Attenborough in every way he has been the man at the forefront of awareness and appreciation of what we have in this world. A man not interested in the fantasies of economics and the future and what we may be able to achieve but a man who takes enormous pleasure in what we already have and has spread this awareness globally. But I think someone needs to take him aside and give him an economics lesson, for only that way will he see that humans alone are not destructive, we can only eat so much and use so much land. What is destructive is when we are forced by an economic system to work all the days of our lives to ever more exploit new markets and resources to create wealth for the rich. Then humans become these monstrous beasts of burden that just churn up the world in a desperate attempt to overcome the weight of the Capitalist aristocracy on their backs that means they have barely enough to live on despite working perhaps 100,000 hours in their lifetime or more. No other animal does this. Gorillas can survive on just 4 hours work a day. Yet with all our fossil energy and machines we are still unable to survive. It is capitalism not population that is the problem, and times are only hard because of the Capitalist Burden.
