Whatever spin the BBC has put on government policy (and I agree they have been simply a mouthpiece for New Labour) … find me one edition of Question Time prior to the 2005 election where Labour ministers boasted about their years of economic growth – and a conservative member of the panel warned that the growth was based on debt and that it would all end in tears.

You’ll have no trouble finding an episode of Question Time where a Labour minister boasted about their successive quarters of economic growth – they did it, unchallenged, every week. But you’ll struggle to find an episode where anyone questioned the fact that it was all based on an unsustainable debt/asset bubble.

But, that is all history. Where is the opposition NOW to current government policy? We have the BOE buying up government debt with the very real risk that interest rates will have to rise and they’ll (sorry, WE’ll) take a thumping loss as the gilts have to be dumped into the market.

We have banks bailed out with billions of our money. Debts being taken on by this government on my as yet unborn grandchildren’s behalf.

We should have let the first bank fail. Protected the deposits – and let them go to the wall. Then, if necessary, bypassed the remaining banks to make sure business can access the credit it needs.

But, the conservatives are still paying lip-service to the house price boom of the last decade. They are still terrified to explain that it was built on unsustainable debt growth – and that the party is over. That anyone who bought at the top of the bubble is going to be in negative equity for 10 or 20 years.

As such, apart from a bit of bleating about the government not lending to business, there seems to be general agreement that there is no alternative to what we are doing now.

If we carry on as we are, we’ll have 10 million unemployed within a few years and gangs roaming the streets.

There is a fundamental reluctance to face facts. What on earth are 60 million people on this small island supposed to do to make a living? Selling houses to each other and financing our lifestyles on the profits doesn’t seem to be working anymore.

Reply: if you look at Hansard you will see Conservatives provided strong criticisms of everything economic from the pensions taxes through the sale of gold to the overreliance on debt, the wasteful spending and the stealth taxes

They probably do not pay Council tax at £2,000 per year on their home, suffer huge Business Rates on their premises or pay exortionate rates for heat, light, and power.

I will not even bother with Rules, Regulations, Tax, Employment Laws, pay rates and the cost of the Benefits Structure.

You need less to live well in some other Countries, here you need more for that same standard of living.

We have some benefits like National Health Service etc that others do not, but in most cases it is a question of choice as to where you want to live, and how you want to live your life.

Our problem for the future is are we going to be more or less competitive in 10 years time.

I could not count the number of times I heard Labour politicians on ‘Question Time’ boast about ‘10 years of consecutive growth’ and ‘48 quarters of consecutive growth’ … over and over again … like a scratched record. I kept waiting and hoping for the conservative representative on the panel to point out that the growth was based on a growth in debt, that it was unsustainable – that we had a debt and asset bubble … but no, not a word – never a word – they always just sat there looking uncomfortable. Why did they never quote Gordon Brown’s words … ‘I will not put at risk the sustainability of the recovery by allowing house prices to get out of control’. But he did, and you said nothing. But, of course, how could you? After what you allowed to happen in the late 80s.

Reply: On the contrary, we were vocal about it. We set it out in the Commons very clearly, but the BBC was never very interested in reporting it or inviting us on to discusss it because it was not part of the Labour spin.

Therefore house prices must fall a lot more unless we return to the old requirements for borrowing.

I was struck by Peter Hain (not literally!) two weeks ago on Question Time asking, rhetorically, “Would you rather we’d let the banks go bust?” (I’ve paraphrased).

Instinctively I think if you’ve mis-represented your bank, made mistakes, called the markets wrong, and you’ve done it enough, then you ARE bust, no matter what you, me or any one says about it. Shuld we have let them go under? Would it have mattered that much?

At the time I imagine the justification was that without bail-outs there would be no lending at all, leading to an ever-more severe ‘credit crunch’ and severe recession. Which sounds sort of familiar. I’d be very interested in your view.

Thanks,

Bernard

Reply: I think that would have been extreme. What I favoured was forcing them to admit the errors, take the losses and sort themselves out more quickly, with the authorities acting as a mean lender of last resort to prevent system failure but not buying shares are feather bedding their excessive costs. Lend little, lend short, lend against security: don’t lend lots, gurantee lots and buy shares. Now we are the owner, be a very tough owner, and make them sort it out quickly.

Exactly, you would think the government would know that as employment falls the tax take will fall with it, that is an absolute certanty.

Yet here they are ramping up their spending …

Reply: No – just too long to do quickly

It was plain to see from the hefty tomes that RISK was flasing red neon on this deal. Any dealmaker would have demanded up-front money from the Treasury before touching HBOS and then have transferred viable entities out of the shell. Anyone who had seen BHS refinanced with a £1000,000,000 cash extraction could guess HBOS corporate lending was dodgy, so why did Lloyds let itself get suckered into a suicide pact by shackling itself to a drowning corpse ?

Lloyds could have been the kernel of a healthy new banking system, now only the Spanish Santander and Hong Kong regulated HSBC and the putatively solvent Barclays are left as High Street banks outside Government control.

I simply cannot understand why Lloyds behaved as recklessly as Peter Cummings when buying HBOS, nor why Andy Hornby wasso weak as CEO that Cummings ran his own empire….but if Lloyds had tried to buy HBOS in 2006 why didn’t the Government let them and have spared us this debacle. How can one trust City fund managers if they cannot read the prospectuses ?

I still don’t understand why damaged HBOS wasn’t sorted out first, by whichever or however many of the tri-partites were required, before being put up for acquisition. Instead, they’ve simply produced another bad bank from one of the few remaining good ones.

Utterly incompetent, and I suspect it was once again a matter of temporary political convenience.

Reduce the salaries of PM and Chancellor indeed!

All that happens now is they flood the economy with new money under the guise of inflating a deflated economy and when the velocity of circulation picks up again they will recall the money.

Except of course they won’t be able to because in large part it will have been spent on the huge bank losses that will start to crystalise, and the other bailouts that will have been given to all and sundry that will have been spent on unwanted production.

The government now have little credibility remaining and their fine words can be “seen through” by the public, even occasionally when they are talking sense.

David Cameron will come to power either when depression has finally taken hold or around the time when inflation starts to become uncontrolable; in either case it will be to his great advantage if his economic credentials are low, because expectations will then be equally low.

What is clear is that it is now too late to bother about what these hooligans are doing with our money and more important that the conservatives have a reasonable idea of how they intend to clean up the mess

Yes, they are selling us pointless financial services – it’s what they do. I remember when I bought my car, they tried to sell me four different types of expensive and pointless insurance.

Far from being clever, the bowler hats in the Trwasury are mugs if you ask me.

Any Prime Ministers Question Time you like, goes something like this:-

(Dave), “On The Bank of England, they are independent are they not”?

(PM), “We saved the banks”

(Dave), “No you didn’t, the Bank of England did that surely”?

(PM), “No, the Bank of England is independent you nit”

(Dave), “Okay, so how did you save the banks”?

(PM), “We bought all their shares”

(Dave), “Where did you get the money”?

(PM), “Err”

(Judge), “You must answer the question”

(PM), “Well the Bank of England put the rates down, not us”

(Dave), “Objection your honor, the witness is failing to answer the question and is deviating”!

(Judge), “I’ve already told you to answer the question, please answer the question or you will be in contempt of this court”!

(PM), “The Bank of England in its independent decision making, which I gave it, (as he’s doing a ‘I got one up’ sign), and the Bank of England ‘printed it’. Yes that’s it, they printed it. Are you daft or something”?

(Dave), “Judge would you please have a word with this witness. He’s now attempting to question me”!

(Judge), “I’ve warned you about that, and if I……………….”

(PM intervention), “I won’t do it again M’Lud, please carry on”!

(Dave), “I asked you about the Bank of England”.

(PM), “Yes, of course. It was me wot gave them authority to BE independent, as I have said”

(Whisper from Alistair), “That’s a good one Gordon”.

(PM), “Right, now can we move on to what’s happening in more important areas or are you going to talk the economy down for another half hour”? – he he he

(Dave), “You made the Bank of England independent and it decided to print the money, is that correct”?

(PM), “Ive already told you that” (pleads to judge), “He’s badgering me your honor”!!

(Judge), “Yes, I noticed he was badgering you and if I have any more of it then Dave will be in contempt”!

(PM), “Thank you your honor, I’ll make sure your pension ( and others), isn’t too adversely affected by these measures I’ve allowed the Bank of England to make independently from government decision making, which allowed me to claim credit if it goes right and to stuff the blame on them if it all turns to sh…., er, if it goes wrong”.

(Dave), “But that’s a load of bollox and you know it”!

(PM), “Judge not, lest ye be judged by others my dad used to say” !!!

(Judge), “Please step down Mr Brown, I think you’ve answered enough questions for one day, and kindly refrain from using such language in my courtroom Davey Boy, otherwise I’ll have to tick you off”!

(Dave), “We’ll see you next week then”!

(PM), “Not unless I see you first and can arrange another Global discussion to be at”….. he he he. “Tarra everyone, see you next week”!