Share this post:
Margaret Thatcher’s most-quoted jibe against socialism is: “The problem with socialism is that sooner or later, you run out of other people’s money.”
Here’s Reform UK’s Sarah Pochin quoting it in a recent X post (thereby proving that Reform itself is not a party of, or for the people):
It sounds clever. It sounds final.
But it is, in fact, nonsense.
Governments don’t spend your money
The first problem is that it misrepresents how money works.
In the United Kingdom, the government issues its own currency. It does not need to take money from taxpayers in order to spend; it creates new money every time it spends.
Taxation happens afterwards, not before.
Taxes serve to draw money back out of circulation to prevent inflation, to encourage or discourage certain behaviours, to redistribute resources, and to maintain the value of the pound.
So, the idea that socialist politicians can “run out of other people’s money” is a myth.
The government can never run out of pounds any more than a quiz show host can run out of points.
Who really spends “other people’s money”?
If anything, Thatcher’s own policies were about using our money to enrich a small minority.
-
Selling off national industries meant collective assets, built with public investment, were handed to private profiteers.
-
Tax breaks and loopholes for the wealthy have allowed billionaires and corporations to hoard wealth generated by workers.
-
Austerity — far from saving money — stripped investment from communities, making society poorer in the long run.
The real socialist approach
Socialism is not about “running out of money.”
It is about choosing to direct society’s resources where they are most needed: into public services, infrastructure, and welfare, so that the whole population benefits.
That creates a healthier, more educated, more productive society — which in turn strengthens the economy.
Thatcher’s soundbite is memorable because it flatters the rich and kicks the poor.
But it is an inversion of reality.
Governments do not depend on “other people’s money” to function. They create money.
The true problem happens when right-wing governments allow wealth created by ordinary people to be siphoned upwards, away from the majority who need it.
Returning to Sarah Pochin’s post: part of the reason Rachel Reeves has to find more money is that she must service the monumental debt that was run up by the Conservative governments of 2010-24 – around £1.7-1.8 trillion.
To put that into perspective, the debt was just below £1 trillion before the Tories slithered into office in 2010; in just 14 years, they tripled it.
So, next time you hear someone quoting Thatcher’s line, you’ll know: it is not socialism that runs out of money.
It is neoliberal capitalism that runs out of excuses.
Share this post:
Like this:
Like Loading...
Myths Debunked: Do socialists really “run out of other people’s money”?
Share this post:
Margaret Thatcher’s most-quoted jibe against socialism is: “The problem with socialism is that sooner or later, you run out of other people’s money.”
Here’s Reform UK’s Sarah Pochin quoting it in a recent X post (thereby proving that Reform itself is not a party of, or for the people):
It sounds clever. It sounds final.
But it is, in fact, nonsense.
Governments don’t spend your money
The first problem is that it misrepresents how money works.
In the United Kingdom, the government issues its own currency. It does not need to take money from taxpayers in order to spend; it creates new money every time it spends.
Taxation happens afterwards, not before.
Taxes serve to draw money back out of circulation to prevent inflation, to encourage or discourage certain behaviours, to redistribute resources, and to maintain the value of the pound.
So, the idea that socialist politicians can “run out of other people’s money” is a myth.
The government can never run out of pounds any more than a quiz show host can run out of points.
Who really spends “other people’s money”?
If anything, Thatcher’s own policies were about using our money to enrich a small minority.
Selling off national industries meant collective assets, built with public investment, were handed to private profiteers.
Tax breaks and loopholes for the wealthy have allowed billionaires and corporations to hoard wealth generated by workers.
Austerity — far from saving money — stripped investment from communities, making society poorer in the long run.
The real socialist approach
Socialism is not about “running out of money.”
It is about choosing to direct society’s resources where they are most needed: into public services, infrastructure, and welfare, so that the whole population benefits.
That creates a healthier, more educated, more productive society — which in turn strengthens the economy.
Thatcher’s soundbite is memorable because it flatters the rich and kicks the poor.
But it is an inversion of reality.
Governments do not depend on “other people’s money” to function. They create money.
The true problem happens when right-wing governments allow wealth created by ordinary people to be siphoned upwards, away from the majority who need it.
Returning to Sarah Pochin’s post: part of the reason Rachel Reeves has to find more money is that she must service the monumental debt that was run up by the Conservative governments of 2010-24 – around £1.7-1.8 trillion.
To put that into perspective, the debt was just below £1 trillion before the Tories slithered into office in 2010; in just 14 years, they tripled it.
So, next time you hear someone quoting Thatcher’s line, you’ll know: it is not socialism that runs out of money.
It is neoliberal capitalism that runs out of excuses.
Share this post:
Like this:
you might also like
Unhelpful things lefties shouldn’t say part 1 – alittleecon
Like this:
Over 90% fall in JSA & ESA appeals as process made more difficult – Benefits and Work
Like this:
DWP Figures Reveal Shocking Delays In Sickness Benefit Decisions – Welfare News Service
Like this:
Like this: