Sunday, 28 December 2008

"Sack 'em" say the Bishops

What fun it is to watch the government squirm under a sustained attack from the seniors of the Church of England. Ministers simply don't know how to react so it has been left to some of their junior number to throw out a few tractor production statistics and insults then see how the wind blows before those at cabinet level decide what they are going to say. Part of the government's difficulty is that the attack has been contradictory and confused so defending themselves against one part could be seen as conceding another. To be on the safe side they decided to stick to standard soundbites combined with the usual petty minded personal counterattack that is rolled out against anyone with the temerity to suggest that anything is less than wholly rosy in poor Gordon's garden.

The personal attack chosen on this occasion is an Old Labour favourite, namely to allege hypocrisy because the Church of England is an organisation of great wealth and should not speak about the least fortunate in our country. This is an amusing little tactic they use time and again. One day it will dawn on these morons that the richest organisation in the country is the government and their attack on hypocrisy rebounds on them many times over. But that is an aside, let's get back to the big boys in purple frocks.

The criticism of the government covered a whole range of issues, not just the economy, according to reports here, here and here. One aspect of the Bishops' ire is of particular interest. Both the chief prayermonger and his main helper in Manchester seem to have concentrated on the way the current government has encouraged people to borrow money. They pointed out that this has two consequences, first it makes the things they buy more expensive (because you have to pay not just the price but interest on the money borrowed to pay that price) and, secondly, it encourages the acquisition of things as an end in itself. This is a particularly powerful criticism because it goes beyond issues of mere money and addresses the destructive effect of placing value on having things to the detriment of less tangible but far more important aspects of the quality of life. It is a good example of looking beyond the direct effect of a political policy to the wider and more long term consequences of that policy being pursued over a lengthy period.

I'm with the Bishops on this one. I have long thrown up my hands in horror that people scramble to buy overpriced tat bearing a designer label when a far cheaper, sturdier and more practical alternative exists. Having the best dressed child rather than the best read child seems a source of pride. When something like that happens you know values are wrong. So much of it results from being able to borrow money cheaply so that everything appears accessible even to a modest wallet. It removes "we can't afford it" from everyday thinking and leads to a failure to appreciate the value of money. Less obviously, it leads to a failure to appreciate that having to save in order to buy something makes one look more critically at that thing itself. Do we really need it? It is really worth the money? If the answer to both those questions is in the affirmative, saving and buying it with your money rather than the money of a credit company provides a satisfaction that adds enormously to the quality of life.

Of course the Bishops don't stop there. They always have the need to argue for the impossible. While decrying consumerism they also decry unemployment. What they do not seem to recognise is that a vast number of jobs rely on unsustainable consumption. Additional spending funded by unaffordable credit does not happen in a vacuum. As demand for goods rises so those goods have to be manufactured, packaged, delivered to wholesalers, delivered from wholesalers to retailers and sold in the shops. More demand means more goods, more goods means more people to make those goods, deliver them and sell them. Many thousands of extra jobs were created by the consumer boom. We are now starting to see those jobs being shed in vast numbers as demand falls. We hear of something in the region of 30,000 people losing their jobs at Woolworths as the shops close yet it goes almost unnoticed that as many jobs again will go in the businesses that supplied Woolworths and provided the services required to maintain the shops and keep them stocked.

The truth the Bishops have noted is the need to remove reliance on credit from the everyday lives of a vast number of people for the simple reason that they cannot afford it and will get in huge difficulties by living now and paying later. That requires a massive re-alignment of values which will delay all sorts of optional expenditure until we have saved and can afford to pay for it with cash. It will also eliminate a lot of current expenditure completely and return us to the ways of the 1950s and 1960s, before credit cards came into widespread use, when very little was spent on pointless fripperies. This can only be achieved at the price of significantly increased unemployment at all stages of the consumer sales process. Hundreds of thousands of jobs will have to go if the Bishops' aim is to be achieved.

We have reached a stage at which a re-alignment is needed just as it was needed in 1979 when the previous incarnation of the socialist economic dream brought the country to its knees. This time it is all about removing pretend money from the system and starting to live within our real means. The Bishops argue for this because they see a serious adverse consequence in the lusting after material possessions. I hope their message is adopted because it will help to provide stability in the economy and, if maintained, prevent a future destructive credit bubble. But don't let's have them bleating about unemployment. The choice is between people living within their means or living beyond their means on the back of unsustainable credit. The former will result in jobs going now, the latter will allow jobs to be saved now but will require them to go later and in larger numbers. There is no middle ground in which customers buy less but the same number of people are employed in the retail sector. It is one or the other.

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