The Old Gaffer

After two months I think I’m back, really, but I’m suspicious enough to be cautious.

These days I am very concerned because I worry that we are no longer governed by the Cabinet, but rather by un-elected spin doctors, representatives from the Labour Party and other influences, in order for the existing government to maintain power, and be successful in the next election. It seems that those at the top of government are more like gerbils in a cage running round on a treadmill, powered by public criticism. The number of unworkable proposals that have been put forward and then rescinded in recent months, especially under the pressures of the credit crunch, seem to prove my point. I have said before that the reason we are in this situation is that while the average man in the street could see it coming with the ever-increasing internal debt, because of buy now and spend later, unfortunately it was grossly aggravated by the Treasury and the Bank of England permitting dealers to invest in exactly the same problems abroad.

How the very poor are going to fare in the coming years is a given. Those of us pensioners who have been frugal all our lives, those being made redundant, and those struggling in business at the high street level, have been and are going to be taxed heavily to make up the shortfall, and ultimately a large proportion of us will join the very poor. The other day I was talking to a lady who specialises in counselling those with personal problems, and the quality of her work is such that she obtains clients purely by word of mouth. She told me that an unusual and growing proportion of her clients are suffering severely on a financial level, many of them because of the credit crunch, which was so sudden and so deep, that it gave them no opportunity to retrench, as they had expected the high standard of living, that we had been given to believe was secure, and had made decisions accordingly.

What I find extraordinary is that there seems to still be the same opportunity to buy, often heavily, if one accepts the TV ads, without security to back the purchases, with months if not years of interest-free loans. How often do you see someone open a wallet at the cash-out of a supermarket, that has pages of credit cards either in waiting, or perhaps redundant. The government is taxing everything in sight, without rhyme or reason in many cases. If the price of everything is going up, then the VAT is consequently rising also, and this is particularly applicable to food and fuel. I repeat, the government sets out its budget in April, but doesn’t seem to stick to it. If it did, the amount of money that it had calculated to receive from food and fuel would be so much in excess that on those items the VAT could be modified, to the benefit of every section of the community, especially transport and haulage.

While I was without any access to the Internet I saw a proposal by the government for charging vehicles by the mile, using satellite identification. I just wondered, when one considered even the policing of the system, the recording , and the cost to the individual motorist for his equipment, just how much profit there would be, and the fact that there would be yet another government computer that will go down inevitably, as they all seem to do, and the chaos and cost that getting that lot sorted, would engender.

I haven’t, a clue where we are headed, I just hope the Government does, but I doubt it. Take this incredible debt that we are servicing, - credit cards, loans, et al. How much of it will inevitably be written off, and who will be the losers in the long run? To answer that, one needs to examine the commercial chain. What are we spending the money on, which is producing the debt? Answer - property, here and abroad; services, like call centres etc overseas: imported goods - practically everything, from cars to light bulbs; manufactured food in lieu of home cooked; entertainment which includes drink, expensive TV and packaged entertainment - much from overseas, and labour. I understand, the Citizen’s Advice Bureau is recommending, for a debt which is beyond help, that, in preference to using one of the highly advertised financial advisers to manage, one should declare bankruptcy, for the obvious reason that the former policy only gets you further into debt.

We are told the people with the greatest spending power are among the retired, they have secure incomes from the old system rapidly being dismantled. When we have all snuffed it and the annuities are recalled, another source of stability will be gone. We then have to ask where we are going to get the money to repay these debts? To provide a lot of these services we are importing labour from outside and we are trying to house all these immigrants - some illegal - creating more debt. It doesn’t seem the money is coming from manufacturing, the utilities are partially owned by other countries, so it would seem we are really paying each other high salaries and fees for services, and the money we handle is going round and round. - but surely on its way round a high proportion is siphoned off to repay for the imports of goods and services. Where is the rest coming from, or are we building an even greater debt abroad? Some say the Stock
Exchange - we have seen what a broken reed that can be in the past.

Who do we owe all this money to? If we are welshing on our debts, then the suppliers of goods will not be paid, and if sufficient people and companies default, the foreign manufactures will not be paid. For services we will owe the banks, the utilities, the building societies, and maybe some small traders. The banks and building societies will claw back through repossession, but then they have to sell the repossessed items - maybe solving the housing problem, or making it worse.

I just wish a high powered accountnt would explain the system slowly and simply so we all can understand, instead of me, at least, standing and wringing my hands for the worry about a future I shall never see.