Thursday, 29 January 2009

The Road to Hell

"And all the roads jam up with credit
But there's nothing you can do
It's all just bits of paper
Flying away from you
This ain't no upwardly mobile freeway
Oh no, this is the road to hell"

Chris Rea called it right - way back in 1989.

Now we are told that the recession will hit the UK harder than other developed countries. I am sure Gordon and his crowd will react with concerned faces, and repeat their mantra that - under 'prudent' Gordon's guidance - we are best placed to get out of this predicament. We just need to restore consumer confidence, get everyone spending again, and all will be well.

Now, I don't claim to understand economics - I not sure even those that claim to understand economics actually understand economics, but that's another story - but I have a problem with the logic of this 'rescue plan'. After all, wasn't it excessive credit and wanton spending that got us into this mess? So, now they are telling us that the banks should start lending again and that we should spend our way out of trouble??

If you'll forgive the rather tenuous historical link, this sounds to me a bit like Hitler's exhortations to the German to 'fight on' until the 'final victory' is secured. The thoughtful Germans amongst them might have reasoned that it was the fighting that had got them into the mess they were in - fighting on was surely NOT what was required.

Anyhow. It strikes me that it should come as no surprise that the UK will suffer more than most - after all, for the last decade or so, the two major props of the British economy have been 'financial services' and conspicuous consumer consumption. We don't really "make" anything any more, as the brutal logic of the marketplace holds that Chinese peasants and Indian child labourers can make whatever it is cheaper, so its not economically viable for us to bother. So, if those two pillars of the British economy are removed - the first hideously discredited, the second finally shown up for its utter unsustainability - then there is precious little left.

And yet - our esteemed leaders are urging us simply to carry on as if the financial world had not just imploded, and everything will be fine. "Imagine its 2007, Britons, and all will be well again."

I beg to differ. I think this should be a watershed. We need to appreciate - once and for all - that our socio-economic system cannot be predicated on some spurious notion of perpetual growth; that the 'global market' is not infallible, that the earth's resources are most-definitely finite, and that the economic model that we have lived with in Britain for the last decade at least has been thoroughly discredited. More of the same, and we really will be on the Road to Hell.

I don't know how it is to be done - but, Capitalism itself needs to be reinvented.

No comments: