Rich getting richer and the poor poorer

HOW is it so many politicians, from the Prime Minister and Chancellor to Secretaries of State, either do not understand international, national, and government finance systems, or they deliberately choose to lie about them?

The best example is the repetition of “spending taxpayers’ money” when in fact there is no such thing, since the Government’s ownership of the Royal Mint and the Bank of England means that it creates its own money whenever it wants; classic examples being rescuing the banks with hundreds of billions in 2008 when threatened with a US-led collapse, and the more recent similar rescue from Covid-led economic collapse in 2020 with more hundreds of billions put into the furlough jobs scheme and business support loans.

These special big sums of money creation came from either build-up of funds from selling government bonds (its ‘savings bank’ with big ins-and-outs on the bonds market) or by so-called quantitative easing, when the Bank of England actually created an increased money supply by buying-up big amounts of government bonds itself.

All such ‘creations’ do not have to be repaid like you and I would have to if we took on big overdrafts or loans, so government finance is never like our household budgets as Thatcher, and now Sunak-Hunt, try to deceive us into believing.

Similarly, national debt is never bad in itself and can be essential for capital development as in post-war days.

Lies are repeated, not only telling us that raising interest rates must be used to control inflation (it doesn’t) but also saying that it was the Tories who brought down inflation (they didn’t, only downing the rate of inflation).

One thing is certain in capitalism: for all the trillions of big money wheeling-and-dealing going on in banking, investment, currency, hedge-funds, energy, food, derivatives, commodities, goldsilver-diamonds, stocks and shares, it always rewards capital (fast increasing the number of billionaires in Monaco and the Bahamas who never need to work at all) at the expense of labour, i.e. we who need to work to live.

Alan Debenham Taunton, Somerset