Back from the economic brink - where we stand
In these potentially disastrous recessionary times it’s fair that all parties, big and small, honestly review their most cherished policies based on today’s conditions rather than the ideal or ‘normal’ conditions parties expect to find in government. UKpopdems is no exception and this addition to the party’s WHERE WE STAND SERIES, aims to do this.
First, I believe there is no totally new kind of recession; we have been here before. Because the banks seem at the forefront of current problems many pundits – the same pundits who failed to see the recession coming in the first place – think we are back in the great depression years of the early thirties. I don’t think so. Chancellor Darling is on record as saying that Britain is suffering the worst downturn for 60 years and I think he is right: this is a repeat of the 1946-52 ‘austerity recession’. Overwhelming debt was the problem then and it is the main problem today. The pound suffered greatly, there was threat of deflation, house prices tumbled, individual spending ground to a halt and Labour were in government – just like today.
Then, it was the private health sector that collapsed and this prompted its nationalisation and renewal as the National Health Service. Today it’s the collapse of the banking sector and, look, the start of an effectively nationalised bank service. Although the recession then was long, as this one will be, the bright side is that the subsequent upswing burst into life in 1952 and continued steadily to benefit living standards for over twenty years. Brown thinks he is ahead of the world with economic solutions but really he is just following the same path as the US money men, pouring cash into the banks and probably industry as well. This is the right thing to do; there is no such thing as a ‘free world’ without thriving banks and industry. But, just like the US, Brown has bottled out of the next logical step of nationalisation, and this is a big mistake.
UKpopdems are pressing for a fully nationalise RBS which, together with already nationalised Northern Rock, and possibly together with Lloyds and The Post Office would create a taxpayer backed Mortgage Bank, Lending Bank, Savings Bank, Investment Bank and Social Bank, giving preferential terms to all British taxpayers and British based businesses; terms that are significantly better than any other bank. This is fair. It is quite acceptable that owners and shareholders should get preferential terms. In addition, as shareholders, tax-payers must have the opportunity to elect the bank’s executive directors, not government bureaucrats and hacks. Just like the creation of the National Health Service in the ‘Austerity’ recession, the creation of the national bank really would be a legacy of equal standing Britain could be proud of. Boosting responsible business, mortgage and even personal lending will put a base line under asset values that everyone is looking for, creating the confidence we need to slowly move up and out of the recession.
The national bank won’t be the most efficient or profitable, but when people need support, they can be confident in getting it. This step is not so radical and could have knock-on benefits too: the restoration of village branches via an expanded post office network, for example; the statutory and safe home for government, local authority, community and state business savings; a ring-fenced hub for community capital projects, social lending and flexible benefit payments: and a centre for financial advice of all kinds.
What about UKpopdems many cherished policies that promise financial and social wealth; real power and a strong voice for all Britons; as well as pride in Briton and our place in the world. First, let’s remember this is a recession caused by debt; government debt especially. If Brown really had been a competent and prudent Chancellor then instead of wasting our money in mad excess, he would have saved it to ensure Britain possessed a cushion of cash surplus for recessions such as this, just like many other countries. Instead he played the role of the foolish virgin who wasted her lamp oil and had none left when it was truly needed to light the way forward. Countries that have cash surpluses now will weather this storm far better than Britain, and Britons will suffer for that. It means that whatever the government does, whatever opposition parties want to do, whatever UKpopdems wants to do to correct the vast failures of the past, they will all have to be financed by more debt. Every pound sterling of debt now will have to be paid back later, either by taxpayers or in some other way such as the disastrous spectre of high inflation. So using debt wisely is imperative.
Priority one is to protect jobs where practically possible and this includes public sector jobs, too. A national bank would underpin lending for individuals and companies but more will have to be done to avoid creating unemployment needlessly. Our cherished policy of eliminating waste will have to wait for better times. You see, one person’s waste is another person’s job. It would be madness to spend money saved by eliminating waste only to spend it on supporting new jobless Britons. We won’t do it. Nor can we expect business to take on full employee health responsibilities and better pension payments in exchange for a zero corporation tax: corporate profits just aren’t up to it and won’t be until the recession is over.
What I do want to do is use debt for three key purposes in the short term:
1. To broaden and deepen democracy by empowering individuals and communities. This means gradually strengthening Parish and Community Councils by moving existing professional support and resources out to those communities able to accept it; and giving those communities who are ready an overriding say over local authority decisions.
2. To strengthen front-line services through the genuine natural staff turnover of back-line public service personnel such as administrative, managerial, control centre and bureaucratic staff. Generally, as one back-office public sector person leaves, a new front-line delivery person will be employed where they can best be used and are most needed.
3. To put real money back into the pockets of individuals and families. Billions have been given to banks; billions will be given to businesses and corporations; yet Brown has been incredibly tight-fisted with those who really matter, ordinary people. The fiddling with VAT has been a dismal failure and should be reversed. I want to rebalance the equation in favour of people and give each household over a thousand pounds of real extra money to spend each year. This would be done by completely abolishing Council Tax; the worst, most unfair and divisive tax ever invented. That would pump more than £25billion of spending power straight into the economy every year, doing its bit to save shops and the High Street.
The government also needs to demonstrate new and daring strategies. For example, there are many countries with cash surpluses but potentially dire declining trading performance. Britain should be working directly with those countries – Japan, China and others to find win, win solutions. One approach could be to negotiate the provision of money-off or free vouchers to consumers who purchase products of that country, keeping goods and trade flowing. Both Britain and those other countries benefit through maintained jobs and skills. Now that would be a world leading first.
Any of UKpopdems policies that can be implemented without creating needless debt we’ll try to move forward with. We will especially push for anything we can do to repair Britain’s broken social infrastructure and weakening democracy because this is what our country and people sorely need more than anything else. When conditions improve this time we want to see the beginnings of a new age of wealth matched by social well-being, confidence and pride in a strong and truly democratic Britain. That’s what UKpopdems is working for.
First, I believe there is no totally new kind of recession; we have been here before. Because the banks seem at the forefront of current problems many pundits – the same pundits who failed to see the recession coming in the first place – think we are back in the great depression years of the early thirties. I don’t think so. Chancellor Darling is on record as saying that Britain is suffering the worst downturn for 60 years and I think he is right: this is a repeat of the 1946-52 ‘austerity recession’. Overwhelming debt was the problem then and it is the main problem today. The pound suffered greatly, there was threat of deflation, house prices tumbled, individual spending ground to a halt and Labour were in government – just like today.
Then, it was the private health sector that collapsed and this prompted its nationalisation and renewal as the National Health Service. Today it’s the collapse of the banking sector and, look, the start of an effectively nationalised bank service. Although the recession then was long, as this one will be, the bright side is that the subsequent upswing burst into life in 1952 and continued steadily to benefit living standards for over twenty years. Brown thinks he is ahead of the world with economic solutions but really he is just following the same path as the US money men, pouring cash into the banks and probably industry as well. This is the right thing to do; there is no such thing as a ‘free world’ without thriving banks and industry. But, just like the US, Brown has bottled out of the next logical step of nationalisation, and this is a big mistake.
UKpopdems are pressing for a fully nationalise RBS which, together with already nationalised Northern Rock, and possibly together with Lloyds and The Post Office would create a taxpayer backed Mortgage Bank, Lending Bank, Savings Bank, Investment Bank and Social Bank, giving preferential terms to all British taxpayers and British based businesses; terms that are significantly better than any other bank. This is fair. It is quite acceptable that owners and shareholders should get preferential terms. In addition, as shareholders, tax-payers must have the opportunity to elect the bank’s executive directors, not government bureaucrats and hacks. Just like the creation of the National Health Service in the ‘Austerity’ recession, the creation of the national bank really would be a legacy of equal standing Britain could be proud of. Boosting responsible business, mortgage and even personal lending will put a base line under asset values that everyone is looking for, creating the confidence we need to slowly move up and out of the recession.
The national bank won’t be the most efficient or profitable, but when people need support, they can be confident in getting it. This step is not so radical and could have knock-on benefits too: the restoration of village branches via an expanded post office network, for example; the statutory and safe home for government, local authority, community and state business savings; a ring-fenced hub for community capital projects, social lending and flexible benefit payments: and a centre for financial advice of all kinds.
What about UKpopdems many cherished policies that promise financial and social wealth; real power and a strong voice for all Britons; as well as pride in Briton and our place in the world. First, let’s remember this is a recession caused by debt; government debt especially. If Brown really had been a competent and prudent Chancellor then instead of wasting our money in mad excess, he would have saved it to ensure Britain possessed a cushion of cash surplus for recessions such as this, just like many other countries. Instead he played the role of the foolish virgin who wasted her lamp oil and had none left when it was truly needed to light the way forward. Countries that have cash surpluses now will weather this storm far better than Britain, and Britons will suffer for that. It means that whatever the government does, whatever opposition parties want to do, whatever UKpopdems wants to do to correct the vast failures of the past, they will all have to be financed by more debt. Every pound sterling of debt now will have to be paid back later, either by taxpayers or in some other way such as the disastrous spectre of high inflation. So using debt wisely is imperative.
Priority one is to protect jobs where practically possible and this includes public sector jobs, too. A national bank would underpin lending for individuals and companies but more will have to be done to avoid creating unemployment needlessly. Our cherished policy of eliminating waste will have to wait for better times. You see, one person’s waste is another person’s job. It would be madness to spend money saved by eliminating waste only to spend it on supporting new jobless Britons. We won’t do it. Nor can we expect business to take on full employee health responsibilities and better pension payments in exchange for a zero corporation tax: corporate profits just aren’t up to it and won’t be until the recession is over.
What I do want to do is use debt for three key purposes in the short term:
1. To broaden and deepen democracy by empowering individuals and communities. This means gradually strengthening Parish and Community Councils by moving existing professional support and resources out to those communities able to accept it; and giving those communities who are ready an overriding say over local authority decisions.
2. To strengthen front-line services through the genuine natural staff turnover of back-line public service personnel such as administrative, managerial, control centre and bureaucratic staff. Generally, as one back-office public sector person leaves, a new front-line delivery person will be employed where they can best be used and are most needed.
3. To put real money back into the pockets of individuals and families. Billions have been given to banks; billions will be given to businesses and corporations; yet Brown has been incredibly tight-fisted with those who really matter, ordinary people. The fiddling with VAT has been a dismal failure and should be reversed. I want to rebalance the equation in favour of people and give each household over a thousand pounds of real extra money to spend each year. This would be done by completely abolishing Council Tax; the worst, most unfair and divisive tax ever invented. That would pump more than £25billion of spending power straight into the economy every year, doing its bit to save shops and the High Street.
The government also needs to demonstrate new and daring strategies. For example, there are many countries with cash surpluses but potentially dire declining trading performance. Britain should be working directly with those countries – Japan, China and others to find win, win solutions. One approach could be to negotiate the provision of money-off or free vouchers to consumers who purchase products of that country, keeping goods and trade flowing. Both Britain and those other countries benefit through maintained jobs and skills. Now that would be a world leading first.
Any of UKpopdems policies that can be implemented without creating needless debt we’ll try to move forward with. We will especially push for anything we can do to repair Britain’s broken social infrastructure and weakening democracy because this is what our country and people sorely need more than anything else. When conditions improve this time we want to see the beginnings of a new age of wealth matched by social well-being, confidence and pride in a strong and truly democratic Britain. That’s what UKpopdems is working for.
posted by United Kingdom Popular Democratic Party at 3:29 pm
