Sincere economic questions

I know that my A grade a-level in economics does not translate well to serious national economics; however, i have some queries over Europe’s, UK’s and the US’s bail-out of the banks. It would be good if someone could explain why what i am saying isn’t feasonable or doesn’t make economic sense.

I get the idea/theory/jist of putting money behind the debts that banks have incurred from stupid, ridiculous lending. However:

Money was also given to banks to give them more money to lend to each other, well… if this money was instead used for sweeping tax cuts, or as grants to poorer families, or to ‘pay-off’ people’s debts, then would this not also give the banks more money? Understandably, if this money was used aboard then it would not be in UK banks, but, nearly everyone has a bank account, so if people have more money to spend then they will have more money in their accounts. Banks use the money people deposit in their accounts as their own money at the moment anyway, i.e. they lend it. So if governments used the money to cut taxes drastically, then more accounts would have more money in them, more people would be spending this money in more shops- pushing consumerism up, more shops would have more money- that is saved in bank accounts. So more jobs are created or kept because people are still spending. And more people are more happy, and from a electoral point of view, New Labour would most likely win a lot more support- Brown could have called an election and become our PM by popular choice.

But instead of this they just gave the money to the banks and asked them to lend it to other banks!? So this leads me to believe there is some illogic in my theory. I am sincerely asking people to explain it to me. This is not me using sarcy theories to push my own ideology, far from it. My ideology is more nationalise all banks, move away from consumer led economy, pump the money into a new green energy sector and move Britain towards a low carbon energy independence, and i don’t want New Labour to regain power. So i am being sincere.

While i’m at it, green energy. If all the money given to banks was instead put into green energy, would it not therefore be feasible for the UK to generate all of it’s own electricity, either from hydro, wind or solar. Could the money not have been used to give a grant to every household to enable them to generate their own electricity and sell it back to the grid? Would a revolutionised green energy sector not provide for thousands (maybe of millions depending on what the sector contains) of jobs- reducing unemployment, raising job competition, giving people job security and allowing them to earn and spend their money, boosting consumerism and along the lines of a previous point allowing more people to have more money in their bank accounts, boosting the amount of money the banks have. It would also give Britain complete energy independence, we wouldn’t need to rely on other countries. We wouldn’t need to have such a presence in the Middle East. In theory, it could reduce any terrorist threat that we are facing- one of the first major aims of Fundamental Islamic Terrorism is to end the influence of the West in the Middle East (destroying secularism and allowing for the push of fundamentalism – i don’t think secularism would be destroyed in the Middle East anyway, even if Britain/America weren’t there)- so because of our reduced addiction to oil, we wouldn’t need to be in the Middle East (Afghanistan but especially Iraq).

Anyway, i am going off at a tangent. My point is, if we gave everyone else but the banks money, the banks would get the money in the end anyway.

One last thing. The National Debt. Who are we actually in debt to? I understand when it comes to borrowing from other countries we are in debt to them, but why do i hear of Britain borrowing from the banks? Am i just mishearing? If we were borrowing from the banks (Bank of England) then to me it is more excuse to nationalise them! Plus who is going to hold the UK to account if they don’t pay back their debts on time? More sincere questions.

Using porn to trap the nation

It has been found that Jacqui Smith has attempted to claim expenses on a tv/internet package that included her husband’s renting of two porn films. Now it is shocking that she (and other MP’s) are able to claim expenses for their tv and internet (what do they spend their wages on?). However think about it. We as tax payers have now all paid for a guy to watch porn. We have all paid for a guy to most likely wack off. And this is only one person that we have discovered. There are hundreds of MP’s claiming expenses. How many of these have we paid to wack one out?

Forward two thought processes…

In the battle against prostitution they have made it a crime to curb crawl, meaning those who pay for sex are the guilty ones (i am not going into a debate about paying for sex and who if anyone is in the right or wrong). SO, my illogical train of thought has linked the crime of paying for sex and us tax payers paying for people to wack off (or watch porn). They arguably are the same. Therefore! Mr Smith has now made criminals of the whole nation.

This nicely fits into Jacqui Smith’s crusade against freedom. (I see her as the female reincarnation of Stalin, a member of a ’socialist’ Party- HAHA- who is paranoid to the extent where she needs to keep an eye on everyone). This is a woman who is pushing for the raising of detention without charge, pushing ID cards, loving the increase in databases keeping all our intimate details and if she had her way – oh shit, she does- would probably ask each one of us to write down where we were and what we where doing each hour each day (like the drugs authorities would like to do to footballers- coercion?- perhaps a near future New Labour policy?) These authortaian policies, along with CCTV, criminalises each one of us. Instead of the great British virtue of innocent until proven guilty, we are now in fact guilty until we can prove ourselves innocent, and even then you probably did something else so they still need to keep an eye on you.

Link back to how a guy wacking off on taxpayers money has made us all curb crawlers and therefore breaking the law… we are all guilty. And now how can we ever prove our innocence? We may not have done anything else in our lifetimes to break the law, but when push comes to shove, we have partook in some form of prostitution in this country, and that according to this Government would make us a criminal. That’s why they need to keep such a close eye on us.

Disclaimer: before commenting, please look up the word satire.

The UK Left should be smug, not wallowing in selfpity

This should be a booming time for the socialist and green movements. It is a time where we should be smug. Our smiles should be brimming from ear to ear at the prospect of the geminate sucker punch of ‘I told you so’ and the opportunity that is in front of us. Yet, we are instead waiting for other people to take the initiative. All this waiting is doing is to play into the hand of an Etonian, who is unmistakably buoyant that the only puissant opposition there is to New Labour is his band of affluent ninnies.

Five interdependent areas should be politically booming, where the red-greens should be taking the initiative by turning them into vote winners and realms of popular support. These are: the environment, terrorism, globalisation, socialist ideology and the factionary subject of nationalism.

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Environmentalists have long stated their claim for the theory of peak oil, and the dangerous race for biofuels. We are now seeing the results of these issues. The basic premise of demand and supply is that as the supply of oil goes down and the demand of oil stays the same or increases, then the price of oil will go up. Peak oil fits into this under supply. As oil is a natural resource, it is going to run out, there is not an endless supply of it. [http://www.fromthewilderness.com/free/ww3/102302_campbell.html] There has not been a discovery of a ‘giant’ oil field since 1976 with a capacity of over 10 billion barrels. [http://www.peakoil.net/AIMseminar/UU_AIM_Robelius.pdf] Originally, oil companies would refuse to acknowledge the idea of peak oil, however now speculation of peak oil works to the benefit of oil companies because it drives up the price of oil and therefore profits. This is not to say that peak oil is just a theory, but instead supports the idea of regulating oil companies, taxing them more and using this money to lower petrol prices. So where are the socialists arguing this case? Even better than using the money to lower fuel bills is to plough the money into renewable energy to make Britain self-sufficient, lower carbon emissions and lower fuel bills. So where are the environmentalists arguing this case?

By becoming energy self-sufficient, we can end the terrorist threat – face it, the only reason we are encamped in the Middle East is because of oil – fight globalisation, and for the more conservative of you, will support British (renewable)energy companies.

There is further nationalism within the environmentalist movement because of its promotion of local produce, and by supporting British farmers. By fighting with this nationalistic stance, the left can win support from the floaters deflecting towards the far-right while at the same time help Britain end its reliance on foreign countries and lower its carbon emissions.

Biofuels is another ‘I told you so’. Politicians have long pushed for biofuels, believing them to be the best way to combat climate change without investing heavily into renewable sources. Environmentalists, instead of being appeased, are livid at such ignorance. [http://www.newscientist.com/article/dn11811-biofuel-production-may-raise-price-of-food--.html, http://business.timesonline.co.uk/tol/business/industry_sectors/consumer_goods/article602228.ece] Although not all biofuels are bad biofuels, the demand for ethanol from crops such as corn has helped lead to an increase in the price of food. [http://www.independent.co.uk/environment/green-living/food-price-rises-force-biofuel-uturn-859979.html] As more crops are being used to feed our cars, there is less food to feed ourselves. Again, supply decreases so price goes up. It is simple economics! I have a letter from the office of the Transport Minister in 2007 (Stephan Ladyman) that claims they have found no correlation between high wheat prices and the pursuit of biofuels. (I will post it up here when I am next near a scanner). It is great to see our Government on top of things, I wonder what they would say now. [http://www.thetechherald.com/article.php/200828/1423/UK-government-to-proceed-cautiously-on-biofuels]

As with oil prices, the left need to be seizing the opportunity of high food prices to win the support of those worse off; the Tories, while providing the only opposition to New Labour, are not going to help them. [http://www.guardian.co.uk/commentisfree/2008/jul/21/conservatives.labour, http://www.labourhome.org/story/2008/7/18/74035/5652]

It pains me not to see the left take greater advantage of the current financial crisis. As with regulating and taxing oil companies, the same should happen to energy companies who will soon be passing on their increased costs to their customers.

Despite the unions becoming more active in support of pay rises for its workers, we see the demands being denied while business men in the city give themselves higher than inflation pay rises and bonuses. [http://www.nakedcapitalism.com/2008/02/uk-chancellor-attacks-city-bonuses.html, http://www.telegraph.co.uk/news/uknews/2022636/City-bonuses-defy-credit-crunch-and-hit-new-record-of-andpound13bn.html]

The current climate is perfect to preach higher taxes for the rich to decrease the wealth gap between the rich and the poor. Moreover, perhaps socialists should abandon their interest in the free trade market to preach protectionism in the case of the fear of businesses moving aboard when faced with higher taxes. ‘If you leave Britain when it needs you, you will never be able to come back and exploit its public.’ We are currently a consumerist market; no business will want to lose us. The change in attitude of the left to free trade markets and protectionism would be the perfect example of how the left can adapt and modernise, without falling into the hands of the affluent as Labour did in the early 90’s. (I do realise that Marx did state that free trade can be described as exploitation, yet it appears that free trade has appeared to have been accepted by many modern day socialists).

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So come on you socialists, you environmentalists, you angry liberal Brits, let us unite and fight this wave of bitterness.