Archives for posts with tag: sovereign money

George-Osbornb

I very much doubt that I have this buttoned up yet, but this is a start.

In striving to understand how the economy really works as against the ridiculous fairy stories we are told to dutifully swallow, I have had to give up some cherished sacred cows which are tied in with my outrage against a government which is causing so many people hideous pain and suffering and driving many to their deaths.

When Theresa May stood up in PMQs, facing Jeremy Corbyn, and brayed that he’s, ‘waiting to bankrupt our country’, knowing that the Tories have created more government debt than all of Labour throughout its history, I want to be outraged at her egregious lies and to point out that George Osborne doubled the debt whilst promising and dismally failing to pay it down.

I have written about the great puzzle of the national debt, and asked where all the money has gone and who do we owe this mountain of debt to anyway?

To discover that this is all pantomime for the public and a complete sham is incredibly difficult to grasp as is letting go of the righteous indignation I have attached to it. I want reasons to be outraged, they deserve it. I want to expose them, and beat them with my anger and outrage and call them to account.

Yet I also remember George Osborne selling off the family silver and asset stripping the nation, to help pay down the debt, and wondering, as I did with the sell off of Royal Mail which was flogged off for a dismally undervalued price of £3.3 billion, ‘How is this going to help pay down the debt, the interest charges on the national debt will swallow these piddling sums in no time?’

But once I stopped frothing at the mouth and chewing my own spleen, I realised that what the Tories are up to is far, far worse than I imagined. Osborne wasn’t even trying to pay down any debt, he was just asset stripping the UK to enrich the vultures in the private sector. The answer to the question of where the money has all gone was simple, to the private sector. Austerity wasn’t about paying down the debt, that was the smokescreen for the transfer of public wealth into private hands. People were dying merely to feed the greed of the private sector, the amount of debt didn’t matter, it had nothing to do with anything.

Jeremy Corbyn has exactly the right answers to the problem in his fully costed manifesto. Invest in the public sector, build houses, create jobs, pay people a decent wage, take our NHS back, grow GDP (Gross Domestic Product), which is what good government investment is about. The ratio between GDP and debt (investment) is that as GDP increases the debt falls (the investment pays off). Government debt is just the sum of its investments, the problem was that George Osborne wasn’t using government money for investment, he was using it to enrich his mates in the City, whilst cutting public investment to the bone. People were dying solely for greed, everything else was horse shit.

Whilst we’re trembling away or raging at the size of the national debt, coke head Osborne and the his equally coked up city boys were laughing their socks off as was every Tory MP with private interests in health care and everything else they don’t bother to mention.

Remember Theresa May telling the nurse, “there isn’t a magic money tree that we can shake that suddenly provides for everything that people want”? Damn right. This is the party that’s privatising you, your grandmother and your children, not to mention your health and the cancer that’s eating you alive. The Mirror reported that Jeremy Hunt told the government Health Select Committee, ‘Britain’s care time bomb is “one of the biggest commercial opportunities” for private firms’. Boom!

When the government bailed out the banks, we all thought that we had to pay it back, because that’s what they told us, but that isn’t what happened, all the government did was shake the magic money tree, because the government is a sovereign money supplier.

We, the people, are not the provider of money to the government, we don’t make money, we make stuff and when we make stuff we’re paid in money tokens provided by the government. Have you every wondered where your next penny is coming from? That’s because we have no control over the money supply, we are not allowed to print money or magic it up on our computer screens. We do not make money and we do not supply money to the government, they supply it to us. Before we can ever pay any taxes, the government must spend money into the economy so that we have something to pay taxes with, because they won’t accept turnips or eggs, or any of the real stuff that we can make.

So what do taxes do? At a local level taxes pay for services from local government, because local government is not a currency provider and needs an income to pay for public services, like domestic waste disposal. Taxes also help keep the economy stable, in times of growth they are increased to prevent inflation and when growth falls, reduced taxes encourage spending and investment. Another vital use of taxes is to prevent inequality and too much wealth being drawn off into too few hands. Extreme polarised wealth is a drain on the economy, because all that wealth stashed away in tax havens has to be covered by some ‘body’ and that body is ‘government’. Money only means something if is backed by trust and certainty, and it is government which is the backer and which provides the certainty that money has any value at all. If money is just stashed away, gambled on financial markets, feeding itself and no one else, and not working in the wider economy, it is a net drain on the wider economy. Tax evasion is a rich persons gain for a poor persons loss, it costs all of us.

It’s easy to see how this worked in the banking crisis, the financial markets were in a closed loop, like tax havens, a boys own club, making obscene profits on dodgy bets. No one outside of this gambling spree was benefiting from it, least of all the poor buggers scammed into buying dodgy mortgages they could never pay back. When it all fell apart around the worthless bankers necks it threatened the stability of money, they had betrayed the confidence and trust that money must have for it to work. The only thing that could save the situation was for national governments, the sovereign suppliers of money, to step in.

Austerity, to pay down the debt, was a confidence trick Cameron and Osborne pulled, using the ‘crisis’ to further the gains of the super rich. Austerity was and is the most fantastically corrupt scam ever pulled by a government on its people and people have paid for that scam with their lives.

As best as I can tell at this moment in time, what happens to our real earned money that is taken in taxes is that it disappears, it’s written off. The government has no need of tax money for its own spending. Of anything that taxation can do, paying for government spending isn’t one of them. So taxing the rich doesn’t pay for the poor, it just prevents the extreme polarisation of wealth. It is the governments job and duty to relieve poverty, no one else’s. And, no, no knife wielding dick is paying for people on benefits or disabled people, or paying a coppers wages, or for immigrants, or for your health. It’s all a gigantic lie and it is time to call time on governments, and the Tories in particular, who propagate the lie and to sort the magic money tree out and make it work for all the people, not just the few.

Exactly what Jeremy Corbyn has promised to do… to the screams of Tory outrage.

KOG. 24 July 2017

http://calumslist.org/

http://www.bbc.com/news/av/uk-politics-40510376/pmqs-theresa-may-gives-a-warning-about-jeremy-corbyn

http://www.bbc.com/news/business-34514024

http://voxpoliticalonline.com/2017/03/01/conservatives-have-created-more-debt-than-all-labour-governments-combined-corbyn-tells-the-world/

http://www.mirror.co.uk/news/uk-news/jeremy-hunt-says-britains-care-7932080

http://www.independent.co.uk/news/uk/politics/theresa-may-nurse-magic-money-tree-bbcqt-question-time-pay-rise-eight-years-election-latest-a7770576.html

http://neweconomicperspectives.org/2014/05/taxes-mmt-approach.html

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12_september_2015A letter a day to number 10. No 1,200

Saturday 12 September 2015.

Dear Mr Cameron,

By the time this letter arrives in London we will know who the next Labour leader is. It’s telling that just before the announcement of the new Labour leader you have launched your own desperate plea against the man most likely to. In the speech you are to give, today, Friday, as I type this letter, you will apparently say, “We can spend less and deliver more”, arguing there is a “moral imperative” to “streamline” services to be more “effective”. When a business uses technology to deliver more for less, it’s regarded as a good thing. But when government does it, it’s too often just badged as cuts.”

You have a talent for uttering the utterly meaningless. Technology certainly plays its part in business and, yes, it can deliver more for less, but the reality is that it doesn’t get passed on, it boosts profit but not general prosperity for workers and ordinary people. But what on earth has technology got to do with austerity, with the many billions of pounds in cuts and the destruction of vital front line services, with sanctions and lives ruined?

You will further say, “Whoever wins the Labour leadership tomorrow, this is now a party that has completely vacated the intellectual playing field and no longer represents working people.” You haven’t even entered the intellectual playing field let alone represented working people in a country which is the most unequal in Europe and millions now live in fear for their lives.

There is nothing intellectually bankrupt about wanting a more socially just and equal society. Education is the powerhouse of the nation and in a nation which is one of the richest in the world education should be one of our most treasured investments providing opportunities for all, not producing people who enter the world of work deeply in debt. Investing in housing, creating real jobs for real people, building the real economy and keeping money in circulation generating yet more money is plain common sense. Instead of lowering corporate taxation, it should be increased to give back to the nation which generously provides the infrastructure that sustains businesses and the markets and on which they are utterly reliant. Having the Bank of England produce sovereign money, given to the treasury to invest in social housing, schools, hospitals and infrastructure is a growth investment for the nation, instead of the crazy PFI’s which are impoverishing us appallingly to enrich hedge funds and banks.

Lastly, Jeremy Corbyn has opened up an inclusive political conversation the like of which I have never seen before and I doubt has ever happened before, so before you accuse Labour of vacating the intellectual playing field, you might like to consider the hundreds of thousands of people you are insulting. The intellectual playing field has changed and you, as primarily a PR man, have never even been in it. Yours is a government for the intellectually bankrupt with you, George Osborne and Iain Duncan Smith chief among them.

http://www.huffingtonpost.co.uk/2015/09/10/david-cameron-jeremy-corbyn-economy-extremes_n_8119660.html

http://www.independent.co.uk/news/uk/politics/report-finds-that-britains-wages-are-the-most-unequal-in-europe-10259077.html

http://www.nhsforsale.info/privatisation-list/surgery/the-great-pfi-swindle.html

http://www.independent.co.uk/money/loans-credit/crippling-pfi-deals-leave-britain-222bn-in-debt-10170214.html

http://positivemoney.org/2014/10/quantitative-easing-giving-cash-public-effective/