Tuesday, 28 April 2009

Help Businesses, Create jobs, help UK survive

Margaret Thatcher championed the right to buy your own house. Others in the US gave the same message and people were heavily influenced to get on the housing ladder at all costs. So ‘my money’ was put into ‘my house’ – the problem was it was ‘my house’ only as long as the mortgage debt was paid regularly and the banks and indirectly the government had all us home owners over a barrel, working as slaves to keep the payments up and avoid repossession.
Now, with the Crunch, this system and its pitfall is all too clear. So better lending terms are needed all round so that sensible loans may be taken and we are not a dragged down in a debt laden society.
Urgently these better terms must extend to commercial loans. For without industry at small, medium and higher levels the UK will not repay its huge loans and life in the way we now expect it will be ended.
It’s not often brought up that the huge bonus payouts made by banks to top staff and unsafe investments had a lot to do with the bankrupt condition they found themselves in even before the credit crunch. Once the payments stopped coming in regularly they quickly felt insolvent.
Another factor, perhaps the real crux of the matter, is the loss of ordinary work to the IT industry. People, even those with technical skills, are needed less and less as guided machines take their jobs. Perhaps here is the real reason for the fall of Fanny Mae and Freddy Mac in the US and the huge repercussions around the world. Many ‘sub prime’ folk just could not find jobs to cover their mortgages
----And where are these sub prime folk, only in America? Oh, don’t think the term doesn’t include the UK and you! The way things are moving only those ‘knowledge workers’ in the right place at the right time will find well paid work. How can the banks lend money to the less fortunate, those who are sub prime?
Only by offering much more flexibility to their customers and accepting much lower profits can this happen..
Simply we must deflate and survive in our own UK ‘cottage’ industries and adopt a fair and well regulated financial system. If a model on these lines can be set up and maintained, there is no reason that we cannot all live happily ever after. But I expect someone too human, greedy and cunning will attempt to mess things up again so we must all watch out!
John B