Today I came across two news items which struck me as absurd. In the first David Cameron was making a speech in which he defended the government's economic 'policy of deficit reduction', which is better known as austerity. In his speech he came out with all the usual stuff, including the fact that reducing government spending was the only way to cut the deficit, and that there was no alternative. But clearly he is wrong. As others, including even Vince Cable have stated, there are very real alternatives. In a shrinking or stagnant economy its more difficult to reduce a deficit, and that, after three years of austerity is where we are now.
The problem in our economy is lack of demand caused by high levels of unemployment, and falling living standards for the 99%. In those conditions people can't afford to buy, and tax revenues fall, especially when commodity prices are rising. If governments increase spending on much needed infrastructure projects such as social housing that stimulus creates jobs, raises tax revenues and revives the economy. You don't have to be a Keynesian to subscribe to this view. The key point though, is that it has never been cheaper to borrow money, so this is the time for governments to spend. Furthermore, there is really no need for our government to borrow, it can create money through quantitative easing (QE). The Bank of England (BoE) has created £375 billion of dosh through QE without any beneficial outcome because it has been wasted on buying bonds. In effect all this has done is benefit the very banks which caused the crisis in the first place by increasing their profits! What we really need is green QE, which means spending money created by the BoE on building environmentally friendly homes, investing in renewables and creating a million green jobs. This will revive our economy, help end the misery of unemployment, create the renewable energy we so desperately need, and move us towards a green economy for the future.
The second bit of news was as priceless as Cameron's failed analysis of the 'need' for austerity; Mervyn King who is still governor of the BoE today put forward a cunning plan to sell off the infamous Royal Bank of Scotland (RBS). This consisted of splitting RBS into a 'good bank', with all the profitable bits, and a 'bad bank' containing loads of nasty debt. There is a huge problem with this plan because the private sector gets the good bits and we, i.e. muggins the taxpayer, gets to pick up the bill for all the nasty stuff, which we will no doubt be paying off for the next generation or so. But there is a much better plan. Split RBS and give the 'good' parts to the taxpayer to create a green national investment bank, and give the 'bad' bits back to the people who created the problem in the first place - the bankers and their shareholders.
These two news items speak volumes about the people who run our country. They live in the past. They have no idea of what is good for the UK and the people who live here. They serve the interests of a narrow and privileged elite. These are the real benefit scroungers - to use their own terminology. They leach off the state to the tune of £billions whilst seeking to deny the poorest and most disadvantaged people in our country the tiny amounts of money needed to keep them going. They also haven't a clue about the restructuring our economy needs to undergo if we are going to create a green economy to deal with climate change. We deserve much better than his, and the only way to achieve real change is to campaign, agitate, and ultimately vote for a positive alternative. That alternative is the Green Party. Join us and help make that change happen. There is no time to lose.
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