This is not a bombshell – it’s (very) simple economics.
As Richard Murphy explains in his video (below), money has no value in and of itself. It used to – when the United States applied the Gold Standard (meaning the Dollar was worth its value in gold) – but when the States had trouble funding the Vietnam War, Richard Nixon put a stop to that.
The Pound was also tied to the Gold Standard, because it had a fixed exchange rate with the Dollar, but that all changed in 1971. The value of our currencies became fluid, attached only to the promise by the Governor of the Bank of England – a government employee – to pay the bearer, on demand, the sum printed on the front of our banknotes and coins.
That promise, in turn, is only worth anything at all because the government refuses to take our taxes in any form other than the Pound. That’s why we do all our trade in the UK using the pound; because if we didn’t, we would have to put our cash through an exchange system – possibly with an adverse exchange rate – before paying our taxes.
And tax is important because it stops our money losing its value. Governments create money (as Mr Murphy explains in the clip). They must also destroy it – otherwise the system fills with too much of it, meaning we have to pay more for the goods it buys, and we get inflation.
It occurs to me that this means certain people are screwing up the system for the rest of us.
I’ll tell you who they are after you see the clip. Skip straight on if you’ve watched it already.
What about people who hoard up their money in tax havens and refuse to pay it back?
I’m referring, of course, to the super-rich.
They seem to think that the cash they have accrued is theirs; it isn’t. It belongs to the government, no matter whose bank account holds it.
And it was created for a purpose. And the government sets tax rates in order to recover it after that purpose is achieved.
So it follows that anybody avoiding tax is deliberately sabotaging the government’s plans.
What can a government do about it?
Well, as we’ve seen with the Tories, the most common choice is to do nothing and let the greedy fatcats keep their ill-gotten gains.
This, in turn, must have an inflationary effect as not as much cash comes back to the government as intended.
And how would a government deal with that?
It would tax the rest of us – those who have no choice but to pay – more.
So it seems to This Writer that you pay taxes for the super-rich who avoid paying theirs.
Do you think that’s fair?
Have YOU donated to my crowdfunding appeal, raising funds to fight false libel claims by TV celebrities who should know better? These court cases cost a lot of money so every penny will help ensure that wealth doesn’t beat justice.
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