Monday, 23 December 2013

UK has not run out of money - but people may!

To read the emissions of the Government or the right-wing Press, one could think that UK was in line for food bank help, being broke. This is far from the case. We are a nation rich in assets, resources, creditworthiness and revenues. How we choose to use these is what policies and politics are about.

Paying interest on debt is something anyone would elect to avoid unless the rates were insignificant. A highly credit-worthy economy borrows at low rates so this reduces the priority for minimisation of debt unless for other, perhaps doctrinaire or political reasons. Such reasons have, however, caused the Government to inflict on consumers an unnecessary squeeze on income [either earned or welfare] and rise in living costs. Unfortunately, consumers are unable to borrow at the same low levels of interest as nations, so their need to borrow in order to sustain well-being through the austerity results in an increase in their debt and interest liability. In other words, people bear the cost of the Government's decisions and act contrary to their instincts.

How a nation uses its resources is also a political issue. This Government has opted to pay off debt, refinance banks and reduce public expenditure, in the name of economic prudence. It could equally have chosen to prioritise the well-being of the people over that of financial targets; or even just raised taxes to ensure the maintenance of effective public services. It did not do so not because it could not but because it chose not to. It has a clear object, indeed, of destroying the very idea of public services, so little insight does it have into the realities of life form any of its voters and so little altruism.

Do we, the people, want to live in a country devoid of the means to help those who for whatever reason are not able to achieve levels of earnings sufficient for independent living? Do we accept it as our role to bear consequences of the gambles made with our money by others? Should we be in debt so that institutions remain able to function largely unchallenged and unaccountable? Should we have lower well-being whilst a few cream off the communal assets of our country? If not, we must elect a Government with a view of economics as concerned with people as well as with balance sheets. By all means let it reduce debt but let this be done at the expense of those who created it.

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