In other news...
If it were that the whole media is, quite rightly, reporting on the end of era and the death of Queen Elizabeth II, there would be two other headlines this morning.
One would be the forcing out of the chief civil servant at the Treasury. Sir Tom Scholar is leaving because the government wants to change the accepted “orthodoxy” at the Treasury. Which sounds a worthwhile effort until you realise the new orthodoxy will be spend more, tax less and borrow more. This is not a radical new economic policy which the Treasury has just been too slow to adopt, it is as I have said before Tinkerbell economics and will be disastrous.
The second, more important and possibly linked headline, would be the energy price cap announced in the Commons yesterday. Which was being torn to shreds by Sir Keir Starmer as the news of Her Majesty’s death was announced.
For a PM who does not approve of handouts, its hands out almost unlimited amounts not to the poor, the needy, the cold and worried but to the energy companies. They will get market rates for their energy, paid for by a cap at more than twice normal energy prices and then a huge government subsidy to make up the difference between that and international prices.
This is an unlimited blank cheque, paid for by borrowing. Borrowing that will have to be repaid and which is being used give the energy companies windfall profits. Madness.
The cost is likely to be 100s of billions of pounds, which poor tax payers will have to repay over the next 30 years. Or to put it another way, poor cold citizens will spend decades paying for the huge dividends paid to mainly foreign, wealthy share owners.
Tinkerbell economics apparently means hand outs for the rich and guaranteed windfall profits for huge multinationals; all paid for by the state and eventually the tax payer.
It is a policy that a banana republic’s corrupt government might impose on its starving population to keep its American masters happy.
Handing businesses huge unearned profits from tax payers pockets is economic illiteracy, you should tax the unearned profits.
Sir Tom might feel leaving yesterday was a blessing in disguise.
Economics, trade and Brexit, not necessarily in that order but the dog always comes first.