Tune in to this – 8.45 pm Wednesday 24th October.
I’ve studied what Ben and his colleagues have done and as far as I can see, they have the best-researched and most in-depth solution to fix our broken banking system.
I’ve just finished reading Robert Peston’s book “How Do We Fix This Mess?” where he goes in great depths into global financial mess. He offers no concrete solutions and warns that most of the actions taken to date merely postpone the possible full impact of the crash; and furthermore, the proposed banking reforms are little more than tinkering – nothing like the deep reforms that are needed.
Ben’s approach won’t fix the discrepancies in global trade, nor the (intractable?) European mess, but it does stop banks holding the nation to ransom, AND includes some very positive side-effects.
If these ideas start gaining currency (such as being discussed on Radio 4!!), watch banks ramp up the biggest lobbying campaigns in history!
I have been continuing my studies into how money works – inspired by the excellent folk at http://PositiveMoney.org.uk
This has led me to the High Wycombe MP – Steve Barker – who is a director of the Cobden Centre and a thinker of some depth.
In turn, he led me to the Institute of Economic Affairs and Nick Silver, who wrote a shocking and sobering report in 2008 – A Bankruptcy Foretold – about the real size of UK debt – when you account for pension (and other) liabilities in the way you would for a company.
With the latest figures, UK government debt is not £772 billion (54% of GDP) but £4.8 trillion (333% of GDP).
The figures quantify the situation, but what moved me most was his succinct summing up when he had to update the figure to £6.5 trillion:
Looked at this way, the UK is effectively an enormous unfunded and effectively bankrupt pension scheme, with a large speculative holding in some banks and a sideline in running a small island state off the northern coast of France.
I wonder – is it better to continue with the perverse (but accepted for countries) accounting policy that ignores pension liabilities, or face the reality that the UK – if it were a company – would be bankrupt?
Would that acceptance change our responses to anything – in particular, the spending cuts?
Somehow, I doubt it.