The Labour government has today proposed the creation of a state bank so that UK businesses and citizens can go deeper into debt by borrowing directly from the state.
This is an extraordinary idea from a government experimenting with ever more wild and expensive ideas. A state bank with loose lending criteria would only prolong this recession.
It's too late, there is nothing the government can do to stop this recession. It could do things to limit the damage, but so far none of its policies or bail-outs have given confidence to the people (a cut in income tax would have) and our currency has plunged at its fastest rate in history.
If there are two essential requirements of a government, they are to foster a stable economy and avoid war. This government has failed on both counts. Brown became "Mr Boom then Bust" and Blair took us into an illegal war against our will. The UK is crumbling under Labour.
Gordon Brown did nothing to prevent a giant property bubble from inflating since Labour came to power in May 1997. Property prices tripled in the 10 years to September 2007 (Nationwide). The collapse of this bubble is the primary cause of our dire economic predicament.
What goes up must come down. But Labour won't accept that. They want to return to the days when getting a £X00,000 mortgage was as simple as signing on the dotted line. That's why they might create a state bank. But it will do more harm than good. This government wastes money on everything it does, be it IT projects, special advisers or general inefficiency let alone ID card and civilian spying projects that have no place in our civilised nation.
The solution? Laissez faire. The private sector should provide banking services, not the government. The banks lent too much money during the boom and now they are compensating for that by lending more carefully. This is a good thing: it helps existing borrowers concentrate on paying back their debts and requires new borrowers to properly justify why they deserve a loan.
This will be a severe recession. But we are British – we'll deal with it and we don't need government interference.
God forbid the British State should next turn its dead hand to providing banking! If there were one – just one – thing it could claim to have done well since 1945, we might have a scintilla of hope for the immediate future. But while these political midgets are in place, the (inevitable) post-colonial decline of this once-great country is avoidably accelerated by the almost criminal lack of control the overblown State machine has over the most fundamental issues. The monkeys are running the zoo. We wouldn’t accept this puerile performance, were we stockholders in a public company in which we owned shares!
We need a fresh and radical approach to modern government and that means stripping politicians of their unmerited power and, if necessary, press-ganging our best thinkers and commercial wizards into recalculating the needs of our hard-working people, and then our economy. A good start would be the elimination of welfare, save for the sick and old, whose benefits should be significantly enhanced. Another would be for the State apparatus to try to fulfil the will and hopes and aspirations of the citizens, rather than dwell in the strange and separate land of a privileged political elite. That format is suitable for government by powergrabbers, and not for the land which, when led by the finest minds in the land, gave the world parliamentary democracy.
Private banks didn’t lend anything. You need to become better educated as to the process by which banks lend money. Banks lend money they do not have. Most of our money supply is debt money. That is to say DEBT only exists when we sign the pledge to repay that sum of debt. Loans are conjured into existence every day…. watch something like money as debt.. it explains things nice and easily.
It isn’t the government that got us into this disaster, it is the puppet masters who chose this direction – the banks and other elite interests are the puppet masters.