Unity News Network has been predicting rampant inflation since the start of the pandemic, including in this column. And it’s here; at 5.4% the worst rate of inflation in 30 years. The only thing to be grateful for is that it is not higher…but watch this space. I heard a financial commentator on the BBC saying that inflation was so high because prices had risen. Well, we all know that prices have risen as we are the people who must buy things to get through each day. But to say that inflation is high because prices are high is like saying a balloon is inflated because it sucks in air! It is precisely the opposite; prices are high because inflation has increased. And inflation has increased because we have thrown money into fighting a pandemic, the dangers of which were also grossly inflated.
But Inflation should be more of a concern than people seem to think it is. The money we threw at the pandemic did not exist. It was borrowed from the future, ours and especially our children’s and our grandchildren’s futures by issuing bonds to financial institutions to whom a promise was made to pay them the money in future, with many bells and whistles of interest attached, if they’ll give us the money now. The problem is, they also do not have the money, so they turn to the Bank of England which just creates more. This is increasingly done at the press of a button; the money is not actually printed but the promise of money changes hands and God help us if even a fraction of the people to whom bonds have been issue call in their debts. The banks would collapse.
Each time the inflationary button is pressed, the value of our money comes down and we need to spend more of it on food and energy to pay for the same amount of goods and services. The standard way of holding inflation in check is for the government to try to have less of it in circulation and to keep that money for themselves and this is done by increasing interest rates. This is good for the money lenders but terrible news for most people who must borrow money to get by and the most tangible outcome of this will be increases in mortgage rates. Many will not be able to afford this and will have no safety net so, as interest rates bite, we can expect to see mortgages recalled and honest working people made homeless.
At the same time as the inflation rate was announced, we were being distracted by both good news and even better news. The good news is that Covid restrictions—for those who paid them any attention—are ending. No more masks and no more vaccine passports, at least in England. The even better news is that it can only be a matter of days before we see the end of Boris Johnson. He remains defiant, but MPs are defecting and calling for his resignation. But these things are mere trifles compared with what is coming if we do not get a government that can control the economy. Rishi Sunak, the present ‘Chancer’ of the Exchequer is highly favoured as a safe pair of hands, but he was the shakemeister general of the magic money tree during the pandemic so I would not bank on that. The Tories have become the party of high public spending and Labour’s only response is that they should spend more, as they would undoubtedly do if they took power. Some people fear the ‘Great Reset’. Look around folks; I think it may already have happened.
Lead Correspondent | David Clews is the Lead Correspondent for UNN, with over 20 years of political/campaigning experience and a wealth of social media and communication skills David gets to the heart of what is really important to the real people of the UK.
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