Tag: economics

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In The Forest – Economics

The Keynes School of economic thinking, Adam Smith, the Austrian School… all these are what I call “In the forest” economics. We’re here in this forest, so we have to reorder things in our best interest.

I say, no we don’t. We shouldn’t even be considering that at all.

We don’t because this would be like hens in a battery farm trying to reorder things so that the battery farm worked in favour of them, not the farmers. It’s like trying to accept something wholly artificial, contrived, designed specifically to serve the needs of those who built it, as somehow being the natural environment for those imprisoned within it. Just tweak it this or that way, they say, and it’ll be ok. More taxes, less taxes. Different taxes. Occasional taxes. Part-time taxes. Tax reliefs. That’ll fix it, say these economics schools, from deep in the forest. Then it’ll work.

I say that’s nonsense. The system wasn’t designed to work in favour of the people in it, but in favour of the people who run it. We suffer an imposed culture and an imposed econom model. They aren’t ours. They didn’t naturally develop here. They were imposed.

The basic societal model is Roman. We first saw it here when – surprise! – the Romans conquered us. We first saw the national currency then too. This was introduced so we could be taxed. It facilitates trade, true, but over and above, handled right it enriches any party having control over the money supply. That used to be the Romans, now it’s the banks.

Effectively, then, we’re now conquered by the banks, who have lately (in historical terms) resurrected the old Roman economic model. Internationally, too, not just here. It doesn’t matter how you tweak and twiddle this arrangement, adding or subtracting this or that tax. The ultimate beneficiaries are still the banks. No matter what we do, we cannot amend the existing system so it works in our favour. We need “out of the forest” economics, then. This isn’t our forest, this isn’t our system. If we’re going to develop something that works in our favour, in favour of we who live in it, we’re going to need to get out of this one completely.

BB

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Cash For Scrap Continues

Among Mandy’s many amusing statements at the Labour Party conference was that the cash for scrappage scheme would continue with money being provided for another 100,000 cars and vans. Cue applause. Excuse me? Did any of those attending have any grasp of the economic consequences of this policy? I doubt it… all it does is bring forward purchases from the future. People who buy now using government money will not be buying in the future using their own. Subsidised sales now mean there won’t be any then. This effectively bankrupts the future to bankroll the present – how is economic growth supposed to arise from this? Keeping the car industry alive now by robbing it of any future serves one purpose, not economic but political. When the future rolls inexorably around and lack of cash means stimulus has to stop, Labour is well aware that chances are it’ll be after the election and they won’t be in power by then anyway. It’ll be someone else’s problem. This is an appalling and cynical management of our finances which if better understood would make their losing at the next election a certainty. Instead they can rely on there being a general lack of understanding as it’s they who determine what level of economic education we receive. No wonder Balls fears homeschooling so much, any independently and properly educated kid is going to see straight through political chicanery like this.

BB

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Load of Balls

Education Secretary Ed Balls suggests he’ll be making significant savings by combining schools into some kind of federation meaning he’ll be able to sack any number of heads and deputy heads. How is this saving money? All those heads and deputy heads won’t be working and contributing to the economy any more. Instead in all likelihood they’ll be claiming benefits and costing the country money instead. They won’t be spending money in their areas so they won’t be putting more money into the butcher’s pocket so he’ll have less to put in the baker’s pocket and the candlestick maker will no doubt feel the brunt as well. They’ll all be paying less taxes, needing less support staff and facilities, less advertisements and so forth. In short, cutting jobs is a surefire way of shrinking the economy.  I thought we were trying to expand it?

How is any of this making savings? The answer is that overall it isn’t, not when you think about it in context. If Minister Balls hopes to impress then he appears to be relying on the electorate not giving the matter any proper consideration. It’s entirely unsound economics, it only appears to  have any significance if it’s viewed out of context. Put it in its true context and it causes more problems than it might solve.

Anyway, like all the other much-touted plans being made by the various political parties, more taxes here, less public services there, it’s real purpose is to maintain the illusion that the growing debt mountain can be solved by prudent budget slashing. Belts would have to be tightened so much that nether regions would disappear into other dimensions. Public borrowing is growing at such an increasing rate there’s little doubt by the next election it’ll be obvious even to the illiterate and innumerate that the sums involved are far too large to ever be addressed within the economic system we have. It always had a mathematical sell-by date built-in to it, it was never a practical long-term proposition, and now it’s broken. We need a new one. On that disconcerting subject, all commentators are mute. What do we replace the banks with?

BB