Deserving Poverty

We cannot afford to keep people out of fuel poverty; we cannot afford to pay public sector workers in line with inflation; but we are always happy to help the banks with their gambling debts. A darling little somebody has given the Bank of England fifty thousand million pounds to throw at high street banks which are "hoarding cash and refusing to lend to each other". After all, if there's one thing that will bring a cash-hoarder to his knees, it's the prospect of more cash to hoard. The governor of the Bank of England has also cheerfully admitted that he is prepared to throw even more money at the problem: "There is no arbitrary limit on it," he said; "it may well go higher", or in Standard English, the only limit on it will be the one arbitrarily set by the banks.

The governor dismissed the idea that the banks are being bailed out: "The purpose is to protect the rest of the economy from the banks, not to protect banks from their previous decisions," he said, though he seems to have been somewhat reticent about just what penalties await the banks concerning the decisions which led us to our present unfortunate pass. As one would expect of a scheme designed to protect the economy from the banks rather than the banks from their blunders, it has been welcomed by the banks, who are doubtless the most impartial judges in such matters. Among the causes of their rejoicing is the fact that the public sector will suffer losses "only in the very unlikely event that a participating bank defaulted and the value of the assets it had placed as security later proved inadequate to cover the value of the Treasury bills"; in other words, if either a bank or the Treasury either gets its sums wrong or decides to be economical with the truth. I feel safer already.