The surreal nature of this government's thinking is evidenced by the fact that it plans to introduce legislation to the Commons today, that it wants passed in days, to permit the opening of more street cafes and licensed pub car parks whilst permitting relaxed rules on car boot sales and fairs. This, apparently, is the way the economy is going to be stimulated back into action.
The logic behind this is fairly bizarre. First, it would seem that the intention is to permit, and even encourage, people to get so drunk that they do not notice the mess that we're in, or which is to come.
Second, it implies that the government really does think very small indeed, probably because it's incapable of thinking big.
And third, and potentially much more seriously, it suggests that they still cling to the idea that all that holds the market back from delivering nirvana is government intereference, and that if only they could eliminate this pesky meddling by local authority licencing officials all would be well with the world post-Covid.
Reflecting on these, on the first suggestion they are right: some will get drunk and increase demand in the NHS.
On the second point, the condition is terminal and probably untreatable.
The third is the big concern, because they are wrong. There is no market-based solution for the UK's current malaise. The evidence is readily available, and is in the form of the savings glut.
For many the idea that there is a savings glut is almost unfathomable when debt seems to be the world's problem. But the reality is that the two are related. A majority of people have too little income. For them debt is now their concern. But some have so much income that they save, in considerable amount. As inequality increases - and wealth inequality is increasing - the problem becomes more extreme.
On the savings side the issue multi-parts but all indicate one problem. First, savings are rising. Second, savers are intensely risk-averse. Third, savers can find nothing better than cash or gilts to save in right now, despite the incredibly low interest rates. And, fourth, those same low rates are not encouraging business to do anything more than refinance existing debt or fund losses. Actual job-creating investment in real activity is virtually non-existent. Business is also completely risk-averse and, anyway, bereft of ideas. The wall of money within the savings glut is not producing market-based activity.
But what that means is that no amount of supply-side reform -which is what this planning bill delivers - will deliver economic growth right now. There is very little economic evidence to suggest that any supply-side reform will now address any known economic problem: it would seem that all desired economic activity in the UK is currently being funded at very little capital cost without the assistance of such changes. The economic rationale for them is, then, very hard to discern. And yet we can clearly see is that this is what the government wants to deliver.
It's a plan destined to fail, very badly.
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I see this more as a case of panem et circenses – give their red wall what they like most – booze and boot fairs. It’s not an attempt at restarting the economy – it’s just distracting the masses. Seeing as Boris and Dominic’s entire approach to running the country is to knee-jerk react to whatever low brow nonsense comes out of their “focus group sessions”, this latest move is entirely in keeping…
A well made observation, if I may opine. Never attribute to stupidity, that which is better explained by malign political intent; or, in terms or realpolitik, and to put it in the crisp form that you preferred; cui bono?
That was exactly my thought – populist pandering to what they think is their core vote. Beer and boot sales instead of bread and circuses.
“ But some have so much income that they save, in considerable amount.”
Or to frame it another way people choose to save and consume less whilst they are fit and healthy and earning well to help fund a lifestyle in later age. Pensions saving is a good thing? Or do you think not?
I have no problem with saving
And no one creates a glut of saving with pensions
I was pointing out that it is how savings are used that matters
And that business has no use for capital right now
Why not address the things I said?
“And no one creates a glut of saving with pensions”
A very strange comment. When collectively savings over a 40-50yr per individual period are massed together of course it creates a “savings glut” as you call it.
“And that business has no use for capital right now”.. another strange comment given that business investment is running at £50bn per quarter according to ONS https://www.ons.gov.uk/economy/grossdomesticproductgdp/bulletins/businessinvestment/octobertodecember2019revisedresults
And that doesn’t include buying financial assets
See another response ……
If the government aims to get us all drunk it HAS to be on the streets….. after all they couldn’t organise it in a brewery!!
Very good….
A very silly post.
The government isn’t making the claim that pubs opening is going to cure the economy. This is just one of many actions being taken. Even The Guardian understood that “The new laws are part of a series of government policies”.
What would you do regarding pubs? Keep them closed? If you’re going to criticise a policy you should also be suggesting what should be done instead.
As for getting drunk, you do know that alcohol has been on sale in supermarkets throughout lockdown?
“they still cling to the idea that all that holds the market back from delivering nirvana is government intereference (sic),” An ironic comment considering that your answer to everything is more government interference.
You really did not understand my argument did you?
Of course I was arguing that this was representative
But you didn’t get I was criticising supply side logic
Hey ho…..
It could also be an intentional distraction – take peoples’ eyes off bigger things – throw in a does of poupulism and blathering bullshit of the sort the fatberg is good at – voila. & the blathering bullshit is on display each week @ PMQs – fatso in full performance mode spouting wall to wall nonesense. Time for a change. I sense & hope a revolution is coming.
I think Hillary is being disingenuous. There are 14 million people living in poverty in the UK, and on average, people renting pay 42% of their income on rent (a recent Guardian article on renting made shocking and sickening reading). Hillary’s comment: “people choose to save and consume less whilst they are fit and healthy and earning well to help fund a lifestyle in later age” is a very telling statement, since it contains a number of pretty huge assumptions: firstly, that it applies to everyone (and thus offers a condemning judgement upon those who end up with nothing); secondly, it completely ignores the manifold reasons why many people work their whole lives never free of debt, not least the fact that you can only “earn” what you’re paid, and that decision is out of the hands of the vast majority and in the hands of a tiny minority; thirdly, it assumes that everyone has a period of life when they are fit and healthy; fourthly, it assumes that there are no barriers to income (such as racism, sexism, able-ism, class-ism, and so on); fifthly, it assumes that somehow a game so entirely rigged in favour of the 1% (or a sub-fraction of the 1%) can ever deliver some kind of cosmic economic justice; sixth, that the economic system in which we operate is somehow a natural phenomena and not a contrived system, that it kind of just is and immutable, rather than designed and mutable. So, as a comment, it’s either staggeringly ignorant or staggeringly cruel. Either way, it’s revealing about Hillary.
Thanks
The idea that there are 14 million people (almost a quarter of the population) living in poverty in the UK is disingenuous nonsense.
Dangerous?
And not nonsense at all https://commonslibrary.parliament.uk/research-briefings/sn07096/
What are you seeking to achieve by vilifying people?
Richard, I don’t think anyone is arguing that street cafes are the answer to the economic problems the country is facing. However they are away to give cafes, pubs and restaurants a chance to survive even for a little longer and also a way to make life a little better. Many wil not be going on holiday this year so expanding the options for trips out is surely a good thing.
You never know such a temporary fix could become permanent and we might be able to takeover more public space for leisure activities rather than traffic jams.
The government is shit but that doesn’t mean everything they do is shit. Greater flexibility for the hospitality sector to expand outside looks to be something to welcome.
I was making a bigger point
You obviously missed it
Nothing new under the sun. Juvenal in his Satires commented on bread and circuses being the standard response of the Roman emperors to keeping the mob quiet. Simples.
🙂
I imagine car boot sales will be very helpful to people selling any stuff they have that can possibly raise a buck or two as they slip into total penury and try to keep homelessness at bay. It seems to Government can plan for some things.