Stuck in Debt
I was reading the “i” daily briefing from the Independent the other day. The headline story agreed with something I’ve been saying for a few years and I know that I’m not the only one. Our economy here in the UK is dependent on huge amounts of borrowing. Consumer debt, secure and unsecured, is used to prop up the high street and thus the Governments tax take to a huge degree. A massive house price boom was engineered (not just in the UK) to support an economic boom. The events of 2008 were the wheels coming off and we’ve not really recovered from that. I don’t believe it is recoverable, or is it healthy to try.
What we have now is that the UK Chancellor is relying even more on the public borrowing and spending large sums to order to make the books balance. This includes a desperate attempt to reignite the property boom. This is in spite of what happened last time. Back in the mid 2000s, when I first starting looking at Taoism, I learned that everything was cyclic. No situation lasts forever, every situation contains the seeds of its opposite. Eventually, the opposite will wax and the current will wane.
I applied this to the housing market and to the whole use of debt and it became a little clearer. Looking at what’s happening now, it’s clear that nothing has been learned from 2008. We’re still desperately using debt fuelled spending to power a notional economy. A wise man called Mike Folkerth once wrote “Exponential growth is the plan, it ain’t possible is the problem”. With apologies to Mike: “Running the economy on consumer debt is the plan. You can’t keep it up forever is the problem.”