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Dear John,
Coronavirus is revealing the fundamental flaws and inequalities in our economic system. By hitting low-paid, insecure workers, and the most vulnerable in our society the hardest, this virus is shining a light on how unfair our economy has always been.
This week saw a whirlwind of activity from the government and the Bank of England to deal with the economic fallout. This kind of coordination between the Treasury and the Bank is spot on, but their policies are falling far short. |
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Things are changing rapidly and it’s hard to stay on top of every development, but our blog from last week, outlining three principles that should underpin any fiscal or monetary response, still rings true.
By 1) protecting the most vulnerable, 2) supporting the green transition, and 3) seizing this as a chance to restructure - not reproduce - our failing economic system, we may even have a chance to come out of this crisis better than when we started. |
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Check out the video version to share online |
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Sadly, right now that is not the path our institutions are choosing to take. Instead they’re turning to the same old tools which failed to save us after 2008 - more debt, more quantitative easing and more bailouts for big businesses. These measures didn’t work last time and they won’t work now.
As people lose their jobs and financial security, and businesses face radical uncertainty, the government cannot saddle us with more debt, and we can’t rely on businesses to protect employees either. Any newly created money should be going to people directly. Chancellor Rishi Sunak may have said “this is a time to be bold, a time for courage”, but he’s failing to live up to those words by not delivering the kinds of radical policies we urgently need. [1]
People have been left in the impossible situation of choosing between: putting themselves and loved ones at risk of infection by going to work, or staying safe and losing the ability to pay rent or put food on the table. We shouldn’t be forced to trade off our health and the health of our loved ones, to keep our economic security. Over the coming weeks and months we are likely to see the economic situation get much worse. Mountains of debt, a decade of austerity and the sacrifice of long-term wellbeing for short-term profits, have left us poorly exposed to a shock like this. But the economic policies announced this week reveal what we knew all along: there is a magic money tree, and there are alternatives to our failing economic systems. Ultimately, Covid-19 has brought into sharp relief what the purpose of our economy should really be - the wellbeing of its citizens. While stationed in our separate homes, the Positive Money staff team will keep releasing blogs, videos, comment pieces and press releases as the situation continues to develop so please do keep an eye on our blog and social media channels; Facebook, Twitter, Instagram, to stay up-to-date. In these uncertain and unusual times, we hope you all stay safe and well, Fran, Hannah and the rest of the Positive Money team
[1] Chancellor of the Exchequer, Rishi Sunak on COVID19 response https://www.gov.uk/government/speeches/chancellor-of-the-exchequer-rishi-sunak-on-covid19-response |
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