The Blurt Of Richard Davies

When What Could Never Happen Here, happens here... It took a civil war and the fracturing of the United Kingdom to force the issue, but finally someone did what needed to be done to sort out the mess we were in once and for all. With the incompetent politicians replaced by the Consensus government, the Federation as we are now called is being led into a green renaissance. We may not be wealthy, but we're getting by, and from here the only way is up... While many people have been browbeaten into believing it, Richard Davies - an executive journalist recently promoted in one of the new media organisations - knows the propaganda to be an empty lie. But as a long-delayed General Election heralds the end of emergency rule and the start of the Democratic Reset he'll find out just how difficult it is to do the right thing in a world gone wrong. The Blurt Of Richard Davies: Today's fiction is a warning of tomorrow's nightmare. Read it while you are still able to.

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10. Chapter Ten

The Crises - Part One. I've just been struck by a thought. I've been writing as if my reader - whoever you may be - would understand the context of the events that I'm describing. I realise that may not be the case, especially if the subtle rewriting of recent history goes unchallenged. So here; for those of you who may not know, is a summation of how we got to our present parlous state.

Even before the Crises things were grim; though most people had no idea of just how bad the situation really was, or would become. The point at which the process leading to the state we're in began has been widely debated, with some experts tracing the genesis of the Crises as far back as the Thatcherite free market policies of the 1980s.

What most people agree on is by the mid-noughties events had reached a critical point. By then decades of deindustrialisation, overseas outsourcing, and a misguided concentration on the service and financial sectors had left the nation unable to fend for itself. The economy was artificially kept alive by the casino of financial speculation; the issuing of endless amounts of government debt; a seemingly unburstable property bubble; and the income from offshore oil and gas reserves: It was a fools' paradise. Some analysts who didn't share the collective delusion warned things couldn't go on this way, but they were ignored until the Credit Crunch of 2007/8.

The near-meltdown of the world economy should have forced some new thinking and innovative strategies to reset the economy on a sustainable basis; but a logical response to the crisis was never going to happen while the policymakers had a vested interest in preserving the status quo. So instead of a jubilee being declared on the loans raised on assets that should never have been so highly valued and the banks allowed to fail in a controlled manner - with small savers and businesses protected by the statutory deposit insurance schemes - the losses of the private banks that were 'too big to fail' were socialised to sovereign balance sheets and became the taxpayers' responsibility.

The plundering of the state finances by the avaricious banking sector didn't end there. With the world economy at risk of sliding into a unprecedented depression, central bankers around the world panicked, and jointly agreed on the suicidal policy of Quantitative Easing - creating unimaginable amounts of virtual money to throw at the problem. The state-supported banks used this money to speculate on the markets and commodities, creating large profits for themselves at the expense of those who found themselves the victims of the inflation that the speculation created. They also became dependent on a constant infusion of state funds, with the markets plummeting at the mere hint of the support being withdrawn. Despite this injection of liquidity into the system, the best that could be said for it was for the short term it stopped things getting worse at the cost of stockpiling stagflation for the future.

The cost of these policies was borne by those who weren't responsible for the crisis and could least afford to shoulder the burden. Public services and social security budgets were slashed, with the poor and disadvantaged being blamed by a government inspired whispering campaign for their own plight. They became the new Jewry; responsible for all of society's problems, with misrepresentative TV programmes deliberately encouraging prejudice against them. The judgmental tabloid press leapt at the chance to latch on to any story, real or invented, about the misdeeds of the 'chav' underclass.

The government was happy to see this diversion of attention away from the problems it had created, and used the climate of antagonism for their own vindictive ends. The official policy towards those in need changed from one of indifferent neglect to outright hostility. It was far easier to condemn unemployed people for their own predicament rather than admit the intractable issue of unemployment was the real problem which needed to be dealt with: There was also political capital and real money to be made from blaming the scapegoats, so that was what happened.

Benefit cuts, 'social cleansing' of the poor from areas they were deemed not to deserve to inhabit, and the bullying of people with disabilities to find non-existent work; jobs they would find difficult or impossible to do in the unlikely event their search were to be successful - and this in the teeth of the worst recession since the 1930s - were supplemented by constant exhortations to report any suspected benefit fraud; real or imagined. Further impositions on the lives of the poor - and only the poor - were introduced. Vast amounts of taxpayers' money that could have been better spent supporting the creation of real jobs were instead wasted on deliberately humiliating 'back to work' schemes that rarely produced any work. No matter; the private companies - allies and funders of the political class - who provided these schemes profited from them. The programmes were another handy stick to beat the unemployed with; a pretext to cut support from those unworthy 'spongers' arbitrarily deemed not to have done enough to justify their meagre allowance.

Further measures to 'make work pay' by making the lives of people claiming benefits so miserable they would leap at the chance of any work - if any could be found - were planned. As an added twist of the knife these measures were portrayed by the Department of Work and Pensions as being in the best interests of those involved, and safeguarding their future. And this was only the beginning of the process...

An ill-informed intolerant climate of enmity festered against a growing number of our fellow citizens. Denied the legal protection against prejudice  extended to the rest of society and abandoned by all sections of the political establishment as feckless wasters they became society's whipping boys. I remember reading at the time a comment posted on a local newspaper site which cautioned "If you kick a dog often enough, one day it will bite back." Eventually, and far later than expected their forbearance snapped. Soon we would learn how true that prescient warning was. One of the volatile elements which would contribute to the Crises was primed; and ready to explode.

Meanwhile the mass delusion continued. Constantly fed the Big Lie by the financial class and their tame media, the gullible believed that we were over the worst of the crisis, and a gradual recovery was underway. The reality was far different. The systemic problems had only been whitewashed over. The vaunted 'recovery' was anything but; based as it was not on the creation of new work and new wealth, but the transformation of what used to be full-time posts into insecure and badly paid part-time positions, with the state expected to make up the shortfall in earnings through the social security system.

This policy had begun in the former UK in the late 1990s with the introduction of Tax Credits. They were intended to alleviate poverty; but their effect was to perpetuate it. But the UK was not alone, other nations also had similar schemes in place. Not until the mid-to-late noughties was there a realisation an unsustainable mechanism for the public purse to subsidise the wage costs of the multinational corporations had been established, despite those companies being adept at tax avoidance and providing little revenue in return. It was no wonder the state finances ran at such an enormous and increasing deficit; but by the time the danger had been realised it was too late to stop the juggernaut.

All the mainstream political parties of the time were beholden to corporate interests; committed to maintaining the status quo in some form, rather than a careful and humane retrenchment from the policy, back to the promotion of a 'Living Wage' sufficient to support households without recourse to state benefits. The failure of successive governments to address the issue left the nation particularly vulnerable when the overdue Great Slump could be postponed no longer.

The question was not if, but when the bubble was going to burst. Buoyed by infinite amounts of artificial 'air money' the markets recovered to their pre-crunch highs, then far exceeded them. Even the housing market began to blow another bubble, inflated by taxpayer support. The True Believers rejoiced in the 'recovery' though insisting at the same time that despite the glad tidings only the continued strangling of the economy with austerity and maintenance of state underpinning for their overvalued markets would sustain the process. Others, realising what had been done and how temporary the respite would be, set about making as much money as they could during this contrived calm before getting out while the going was still good. The next great storm was approaching, even if few people realised the fact.

The irrational exuberance continued for far longer than anyone had thought possible. Some countries fudged their books and declared they were officially out of the special bail-out measures. Then, as it always, inevitably does the undeniable truth of the situation reasserted itself.

There were any number of potential triggers which could have prompted the panic; the US public and private debt time bomb, the Chinese bubble bursting, another natural disaster undermining the Japanese economy... But even though the underlying causes were many, and the problems began elsewhere it was the knock on effects that set the dominoes falling in the bankrupt in all but name Eurozone.

Time after time before its problems had supposedly been 'fixed' by printing more imaginary money and lending it to the impoverished basket case nations with such vicious austerity conditions attached that their economies contracted still further. Each time 'the can was kicked further along the road' it became heavier, the distance it travelled became shorter, and the foot kicking it became more bruised.

Eventually the self-destructive process reached its limit. The Euro lost its credibility, and splintered into a 'hard' Euro backed by Germany and the Benelux countries, while the rest of the former Eurozone nations reverted back to their legacy currencies. Those victim nations of the Great European Project put up their remaining meagre gold reserves, or the last state-owned assets, or anything that they could get the international lenders to accept as having some sort of value to try to tide themselves over the currency shock.

The ripples of the financial turmoil spread around the world and destabilised both the United States and  especially Japan, both of whom had thrown caution to the wind and yet more make-believe money into the market in a desperate attempt to stimulate their moribund economies. Latterly even China had got in on the act in the hope that some sort of growth, even a sluggish growth, would help avoid or at least defer the formidable problems she faced; but all to no avail: Suddenly the imaginary confidence was shown up to be the illusion it was.

The reckoning came with electronic swiftness. Irrespective of whether the markets were open, or trades done on the out-of-hours unofficial grey exchanges; regardless of 'circuit breakers' and suspensions of trading; heedless of reassurances human and algorithmic traders panic sold at whatever price they could get for fear of losing even more if they delayed. This time there were no 'Buy The Dip' or 'Dead Cat Bounce' temporary respite rallies. Anyone who was brave or foolish enough to try those strategies went bankrupt even more quickly.

Around the world in an instant the Flash Crash reduced the value of all kinds of assets by an average of around 40%. The hysteria spread from the markets to the streets with a rush of panic buying while money still had some value. The first instances of disorder and frantic looting were seen. There were runs on banks as individual depositors and institutions withdrew their deposits before the accounts were frozen and raided by the state for 'bail-in' funds.

The central bankers tried to intervene but they had already used every last measure of their credibility. No-one believed them anymore. As the interconnected strands of commerce unraveled inflation began to soar; seeing rises in a week that would have once been considered appalling as an annual rate. Increasing numbers of people were thrown to the tender mercies of the social security system as the effete 'weightless' sectors of the economy were blown away by the winds of the financial storm.

Eventually as happens with all financial disasters the smart money which had been biding its time on the sidelines decided values had fallen far enough and there were now bargains to be had. Even in this gravest of crashes there was always the opportunity to profit in adversity; you just needed to be in a position to exploit the distress of others. The markets stabilised for the time being with states once more underwriting/ the risks of those who were the most vehemently opposed to providing safety nets for others less fortunate. The collective confidence in the fantasy of 'magic money' returned for the moment at a much reduced level, but who knew for how long this respite would last?

Though absolute catastrophe had been averted - or more likely postponed - we still faced a dread future of inflation, or deflation, or bizarrely even a combination of both at the same time as the delayed effects of the crisis worked their way through. The global economy had been so damaged by the excesses of the past few decades that it would remain in state intensive care for the foreseeable future. It would take generations to recover to its previous levels, suffering as it was from outstanding debts which could never be repaid, and money that had permanently lost its value. The future had come to reclaim that which had been mortgaged on it with a vengeance and the years of growth were gone as if they'd never existed. This had been the Great Reset, and from this point on our lives were going to be very different.

But how much deeper would the yawning gulf opening beneath us have seemed? How many more of us would have joined the suicides preferring death to the hopeless life they saw ahead of them? What would have happened had we known then what our future would hold? For though things were bad at that moment; they were about to get far worse.

 

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