Sidewalk Solutions

As Governments around the world pretend that they have found a cure for our Credit Illness – have we been cured of this blight? Have we suddenly all changed into the prudent and thrifty people we should be?  Whilst we have all been re-educated on Global Warming (the UK must have missed Global Warming this summer!) and how we must change our light bulbs and ensure the plastics are kept separate from the newsprint – have we changed our financial habits that have led us into this financial mess? In fact describing it as a mess may be something of an understatement.

No worries – the Governments are in charge – they are all rushing to print and borrow money – loads of the stuff – the same stuff that was so scarce a few months ago that the policeman’s pay deal couldn’t be honoured and the NHS refused to treat sick patients because of a committee called NICE. As mega-size tankers full of cash compete to dump taxpayers earnings down the drain (does anyone know where all this cash is going?) we are told that everything possible will be done to ensure the security of our banking systems.  Everything Possible – that depends on who is in charge of the possible! I don’t think so – the bill is coming and when we see it we won’t like the possibilities that they chose.

Have the Governments addressed the causes of our Credit Illness? Are there new rules in place to prevent greedy Bankers from lending to high-risk Borrowers? Have Borrowers learned anything from their illness? TV Advertising still continues to encourage people to take out loans they cannot afford – they tell people to release the equity in their homes so that they can take that holiday they did not earn! In small type on the screen appears a warning that they may lose their home if they don’t keep up the payments – but who cares – the catchy 60’s pop tune makes it so attractive to those who are the most vulnerable amongst us. At a stroke, Governments will not hesitate to legislate on anti-smoking laws or ant-fox hunting legislation. But nothing is done to educate the TV public on how to be prudent and thrifty. Governments prefer silly causes to sound values – but we better learn about prudence and thrift – because therein – lies our cure.

Anyone in business will tell you that getting out of a mess will take longer than getting into it – but not the politicians – borrow a few hundred billion and hey presto we can all get back to spending too much again! The public need to know exactly what we all need to do in order to keep our economies healthy, progressive and in good condition. We need to be made to understand the harsh realities of our financial over-indulgence.  Schools need to teach sound business principles – e.g. how to run a profitable business – understanding the basics of Cash Flows and using existing assets better. How to reduce financial waste – or time waste – all waste – not just environmental waste. Young people need to have an understanding of how markets work well and how they get ill. They need mentoring on how to make the most of their talents. How to uplift themselves in order to be better – and more positive about the future. There needs to be a School Exam / Diploma for every student – that assures us that students leaving full-time education understand the basic principles of a well run business and the basic principles of self-development. At least that way we will spot those who can’t tell a raffle from a good business proposition!

Much of the Credit Illness comes from a lack of education and ignorance about how our market economies really work. It is made worst by people like Gordon Brown who distort peoples beliefs by his over spending and high tax regime.  Free Markets suffer when Governments take control – history proves that when Governments think they know best – that is when things go badly wrong. Time will tell just how bad Gordon Browns wasteful spending has been – like all Socialist causes – it will end in tears.

Today our Governments are getting bigger instead of smaller – they are have an increasing influence on our future financial decisions. They are trying to do things that they cannot do well – and the free market is turning against them. Things will get worse before they get better. It has taken many years for our Credit Illness to take hold – it will take even longer for the free market to cure it.

The world is more bereft of leadership than ever before. Without Vision the People will Perish says the Bible. I have enough faith in the free markets to believe that we can avoid being perished – but leadership has never before been more needed than it is today.

We have not even started looking for cures – but rather we assume that Governments know best. We do so at our peril – we should assume that our Credit Illness is just that – an Illness – we need to start taking our medicine, change our bad habits – learn healthier ones and be prepared for a bumpy ride.