SO, we must all fasten our seat belts because we are in for a rough ride, money-wise.
That was the blunt message delivered earlier this week by Mervyn King, Governor of the Bank of England.
He warned of a further squeeze on household finances, with food prices and energy bills going up again and property prices falling, maybe very steeply.
We could be heading for a recession, he said, and added that “the nice decade� was behind us. Eh?!
Mervyn's surely right about the bad stuff coming our way, but I can't agree with his assessment that the past ten years have been at all “nice�...
Sure, we’ve had low inflation and more or less full employment.
But the extra jobs came at a terrible cost – with most roles created in the public sector, mainly “non-jobs� with councils (such as smoking ban enforcement officers) and other busy-bodying arms of the State, including the NHS, which these days only seems to make people ill and try to boss everyone about.
Unemployment has actually risen - it's just that the Government has fiddled the figures to disguise that. Come ON! Anyone who lives on Merseyside knows the truth of the situation.
Many other hallmarks of the “nice decade� have failed to impress me.
For instance, we’ve witnessed the police filming our every move on CCTV. Merseyside Police are among the must enthusiastic supporters of this sinister and nasty attack on our liberty.
Lemme see now…“the nice decade� was also characterised by: bloody, hate-filled terrorism; morons from TV shows such as “Big Brother� feted as celebrities; local shopping centres across the land collapsing under competition from nasty supermarkets; buses and trains going from bad to worse; housing associations arrogantly lecturing tenants on how to behave; and urban decay of the sort that has seen parts of Wallasey and Birkenhead reduced to rubble.
But if matters are to get worse, economically, then at least things might improve philosophically, because we’ll have the opportunity to think about what’s truly important in life.
And maybe, just maybe, we’ll find in our folk memory those traditional values of fairness, good manners, social solidarity and love and support within families and neighbourhoods that our grandparents' generations had.
If we started to act like good, intelligent people once again that would be a most welcome change from how we were in the “nice decade� – i.e. superficial, unpleasantly consumerist, vain, thick, immature and self-centred. Think WAGS, chavs and Big Brother contestants.
Just recently I touched on some of these issues in a “Thought For The Day� piece I did for a BBC Radio Merseyside.
Below I reproduce that piece. See if any of it rings bells with you…
“Well, we’re in the middle of May – traditionally a sunny, optimistic month.
“The sun finally came out for us in May and perhaps that did lighten people’s moods.
“But personally, among my circle of friends, I haven’t noticed people being especially light-hearted or kindly disposed as summer begins.
“In fact, in recent days and evenings, it’s felt like everyone has been drinking Nark Water from the mythical Reservoir of Bad Tempered Blighters.
“I don’t know. Maybe folk are worried about the credit crunch.
Maybe they were dissatisfied with their football club’s achievements as the season closed.
“Or it could be that some people are heavy-hearted because they face another day at work, enduring poisonous office politics or even bullying.
“Others might this morning be eagerly anticipated a job offer arriving in the post … after years of limping along on state benefits. Good luck if you are!
“And maybe we are all, collectively, entering an era which is never going to be described as feelgood. I rather suspect that’s the case.
“Actually, in our hearts we know life can’t always be a bowl of cherries. We live in a fallen, imperfect world but we each have a moral conscience which we ought to use wisely.
“In good times and bad, we must be kind and supportive to our neighbours and hope they will be kind and supportive back.
“We have to live in solidarity with each other. It’s really the only way.
“And when we face adversity, we should try, if we can, to meet it with fortitude – a truly great virtue.�
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New Brighton Newbie wrote...
Hi Steve,
Good to see you on Saturday night!
I believe that the so called "economic good times" were just an illusion created by, for example, the deflationary effects of the flood of cheap goods from China, Supermarkets becoming ever more powerful and bullying their suppliers, selling off our assets (e.g. utilities and corporations, not to mention the amount of expensive property sold to overseas millionaires) and record levels of government borrowing.
House price inflation has been great for estate agents, mortgage lenders, property investors, people inheriting property and those downsizing, but misery for people trying to get on the property ladder.
Buying your first house used to involve maybe cutting down on your trips to the pub and working a few hours extra overtime, now it means working crazy hours and handing over practically all your wages to your mortgage lender (appropriate that "mort" means death in French!) even to afford a hovel.
Take our house in London... the people we bought it from had bought it in 1997 for around £90K. With a 5% deposit, you'd need to earn around £30K a year to get a 3x multiplier. A good wage especially back then, but the senior programmers in our office were earning £35K at the time.
10 years on, we sold it for £380K (I wish we'd bought it in 1997, we didn't make that much!). A senior programming role that paid £30K 10 years ago would maybe pay £35K - £45K, maybe less as so many jobs have gone to India, but you'd need to earn about £120K a year to buy the same house on a 3x multiplier.
Some say the true level of unemployment is nearer five-six million. Hard to know if that's correct or not, but I certainly think that the quality of jobs on offer has taken a knock.
And another problem of so many people working for the state is that it isn't sustainable in the long term as those jobs generally don't bring money into the country, and we need to earn foreign cash to pay for all the stuff we import (i.e. practically everything).
With the trade deficit hitting £20 billion some months (an overspend of £333 per head of population if I got my zeros right!) I'm no economic expert, but surely that can't go on forever.
It's a funny old society when you think about it. When people built factories up from nothing and created jobs for people, people would resent them for being rich. Yet today, celebrities earn obscene amounts of money for doing very little, and far from resenting it, people buy into it! Stick a foul mouthed, talentless, poorly educated south london estate girls's name on a perfume and people buy it just because she's been on a meritless tv show! If that isn't a signal that something isn't right somewhere, I don't know what is!
As you say, hopefully if there is a correction, people will open their eyes and start to see what's going on once more.
REGAN REPLIED: Thanks Newbie for another fine piece of spot on social analysis.
Posted by: New Brighton Newbie | May 19, 2008 9:20 AM