Sometimes a headline can just grab your attention and give you that sinking feeling in your stomach. A feeling of defeat, that what you see around you can’t get better. Sometimes it hangs around, but sometimes you just get angry and annoyed.
The other day I got angry, angry at the fact that Huw Pill chief economist at the Bank of England has proclaimed that Britons “need to accept that they’re poorer”. It’s hard not to feel the instant rage of an upper-class banker on a six figure salary speaking on an American Ivy League university podcast, talking as if the village idiots back in his country bizarrely just wont accept that they are poorer. Does he find it puzzling why those on the picket lines are more concerned about heating their homes and putting food on their tables, rather than “working together” to get inflation down? Pill goes on to state that “we all need to take our share”, thus giving off the impression that we’re all in this together and everyone is suffering. Except that’s not true is it? The richest have continued to get richer or live extremely comfortably and the poorest have continued to get poorer. Currently in the UK you don’t have the right to share the wealth, but it seems that you do have the responsibility to share and accept the inflation.
I for one will absolutely not be accepting it. Yes, I like everyone else who isn’t a top earner puts up with it, be that the food bill that grows every time, the letters from both broadband and energy supplier informing of monthly payments increasing or that realisation that disposable income is almost something of the past. But I will be damned if I accept it, move on and don’t try to change it.
In the twisted logic that is the economy what Mr Pill is saying makes sense, don’t raise wages as someone needs to bare the brunt of inflation so we can attempt to reduce it. However, what Pill doesn’t acknowledge in this interview is who that someone is, and it most certainly isn’t the high earners. UK inflation sits at 10.1% and still remains the highest among G7 nations, although many other nations have seen inflation rise none have had the sky rocketing numbers we’ve been seeing and continue to see. Despite predictions inflation in the UK has stayed stubbornly high. A mixing pot of misery has made sure of this fact. From Brexit causing a host of problems that continue to persist. Issues with pandemic recovery have helped to create labour market shortages, these also can be attributed to Brexit. Perhaps more prominently the war in Ukraine have forced us to address our over reliance on natural gas and specifically gas that came from Russia. Energy prices have shot up and although predicted to alleviate slightly in the coming months, they will still be much higher than 2020. Grocery inflation has risen to 17.3% and although all of those previously mentioned events have added to this, we must also add climate change to that list. With every degree that the world heats up by we lose crops, with every adverse weather event such as flooding or drought there is a less reliable crop yield, therefore pushing up demand and inflation.
Interest rates have continually risen, not forgetting the little boost they got from Trickle Down Truss. The Central Bank has risen interest rates again and again and even with they’re forecasts which should be taken with a fair amount of salt place inflation to fall slightly, they are supposed to rise once again to beat inflation. Many have argued that the central bank have not been able to foresee any of the current problems and have been equally bad at helping to alleviate them.
However, Pill is aware of those issues and to a point it is out of his control so the easiest option is to tell us all to stop demanding higher wages just like his colleague, Bank of England governor Andrew Bailey asked people to stop asking for wage rises, even though wage rises have in no way come close to inflation. There was however no mention of greed inflation. The big businesses that despite all the woes of the day are making record breaking profits. How can we not mention that many businesses are using the current situation to rise prices more than needed. Profit-driven inflation is happening right now, with no price controls the likes of BP and Shell can continue to profit from the war in Ukraine, increase wealth inequality and fatten their pockets. Large food production conglomerates such as Mars and Kraft have been accused of unnecessarily inflating their prices, with some of their product prices increasing by more than 50%. Last summer Tesco found itself in a rather public negotiation with Kraft Heinz as they stated they couldn’t justify passing unjustifiable price increases onto their customers. This sadly saw the nation’s favourite baked beans producer momentarily disappear from the shelves until the two companies found some resolution. Then there’s the likes of EDF who saw increasing profits of £1.12 billion in its UK arm of the business.
So how come Mr Pill isn’t mentioning this, making a big fuss over the businesses profit-pushing inflation? Perhaps it has something to do with the government not wanting to give the impression that they can afford to pay those in the public sector more. It might be better for them to let the current situation carry-on. However, when others are profiting exceptional amounts why should we sit back and accept this? Although price controls still remain a rather controversial method, there are ways to regulate markets so those at the top don’t force those on low incomes to choose between eating or heating.
The small amount of very powerful people sitting on top of the pile of wealth in the UK want us all to “accept that we are poorer” and do nothing about it. Leave the system the way it is and carry on with our lives. In a fairer society when Pill says “accept that you are poorer” he’s not addressing the nurses, teachers, rail worker etc, he’s speaking to the rich. Furthermore he proceeds to explain to them by spouting the nonsense that they’ve been feeding to everyone else. “Look Mr Dyson, or BP and Mars when we said we’re all in this together we actually mean it this time. Profiting from greed is no longer supported here”.