There’s an old saying (about two minutes old), that if you put one hundred economists in a room together you’d get ninety nine different opinions. Actually you might well get one hundred variations but I’m allowing for an unexpected collaboration.
It seems, however, that there is a growing communion among the “experts” that they’ve unearthed Nirvana. It’s called the Magic Money Tree or MMT. In fact that really stands for Modern Monetary Theory but I fancy it adds up to the same thing! As far as this non-economist can decipher, The Theory is that governments can now borrow as much money as they like, to spend on capital projects like roads, railways, schools and hospitals. The resulting growth in GDP, will mean the shekels come flooding back into the Treasury coffers allowing the massive debts to be repaid. Some seemingly quite brilliant people are convinced this will work…….
Harking back to the 1970’s and ’80’s, which weren’t always the happiest socially, the Government’s books were generally just about balanced, with minimal debt. It was only when we were subjected to the wise and prudent fiscal management of Gordon Brown that our National Debt rose to a staggering £1.4 trillion. Hence when George Osborne took over, “austerity” seemed essential. So successful were his policies that the debt is now a record-breaking £1.8 trillion. Despite that, it seems the economy is now in a much healthier state and it’s therefore quite possible to plan new public spending amounting to hundreds of billions of pounds. I think I’ve missed something along the way?
But we are mere minnows compared to Trump’s America. Their National Debt is now over $22 trillion and climbing, with borrowing in the region of 105% of GDP. I am neither a mathematician nor an economist but surely it’s only a matter of time before the rest of the world realises that the once great US of A has become a Banana Republic and the mighty dollar will collapse until its worth less than a used Tetley teabag. The Donald will then be vying with President Maduro of Venezuela for next year’s Nobel Prize for “Economist of the Decade”.
Incidentally, in case you can’t get your head around a trillion; in seconds, that equates to roughly thirty two thousand years. (32,000). (One billion is thirty one and a half years; 31.5). So America’s debt in seconds is seven hundred thousand years, (700,000) give or take. It makes my £8,000 overdraft look entirely manageable.
My old business guru said that the first thing he looked for in a potential employee was their education and academic achievements. One of Mr Corbyn’s more inspired solutions to improving the nation’s learning is to close down all private schools. Genius. If the politics of envy dictates this should happen, there is a much more logical and beneficial solution. Pump all those extra billions into the State sector, improving facilities and the quality of the teaching staff. Why, for instance, do State schools finish at 3 pm? They could do an extra hour every day at least, engaging in sport perhaps. With a fitter and leaner student population, there might be less pressure on the NHS and as soon as hard-pressed parents realise their little darlings will do just as well under State management, private schools will automatically decline anyway for lack of numbers. I know, it all sounds too simple!
I’ll pursue this thought tomorrow, particularly the availability of sports facilities. I have a plan!
2MPC
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