{"id":61819,"date":"2022-02-08T08:04:47","date_gmt":"2022-02-08T13:04:47","guid":{"rendered":"https:\/\/olduvai.ca\/?p=61819"},"modified":"2022-02-08T08:04:47","modified_gmt":"2022-02-08T13:04:47","slug":"welcome-to-the-age-of-cuts","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=61819","title":{"rendered":"Welcome to the age of cuts"},"content":{"rendered":"<div class=\"post-cover-head\">\n<div class=\"single-post-thumb single-has-thumb\">\n<div class=\"post-cover-title\">\n<h3 class=\"name post-title entry-title\"><a href=\"https:\/\/consciousnessofsheep.co.uk\/2022\/01\/29\/welcome-to-the-age-of-cuts\/\">Welcome to the age of cuts<\/a><\/h3>\n<\/div>\n<\/div>\n<\/div>\n<div class=\"content post-cover\">\n<article id=\"the-post\" class=\"post-listing post-6975 post type-post status-publish format-standard has-post-thumbnail  category-economy\">\n<div class=\"post-inner\">\n<div class=\"entry\">\n<table id=\"amazon-polly-audio-table\">\n<tbody>\n<tr>\n<td id=\"amazon-polly-audio-tab\">\n<div id=\"amazon-ai-player-label\"><\/div>\n<div id=\"amazon-ai-player-container\"><audio id=\"amazon-ai-player\" class=\"amazon-ai-player\" preload=\"none\" controls=\"controls\" data-mce-fragment=\"1\"><\/audio><\/div>\n<div id=\"amazon-polly-subscribe-tab\"><\/div>\n<div id=\"amazon-polly-by-tab\"><a href=\"https:\/\/aws.amazon.com\/polly\/\" target=\"_blank\" rel=\"noopener noreferrer\"><img decoding=\"async\" class=\"tie-appear\" src=\"https:\/\/d12ee1u74lotna.cloudfront.net\/images\/Voiced_by_Amazon_Polly_EN.png\" alt=\"Voiced by Amazon Polly\" width=\"100\" \/><\/a><\/div>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n<p>The UK government faced a barrage of criticism over its\u00a0<a href=\"https:\/\/www.bbc.co.uk\/news\/uk-60171519\">National Insurance hike<\/a>\u00a0this week.\u00a0 The tax \u2013 which\u00a0<em>theoretically<\/em>\u00a0pays for public services, pensions, and benefits \u2013 was in creased last autumn, before the political class became aware of the massive increase in gas and electricity prices coming later this year.\u00a0 However, with cost-push inflation rising across the economy, and with rises in local taxes due to be announced, millions of British households are facing a massive squeeze on their standard of living.\u00a0 This has given more weight to the idea that government should extend its pandemic borrowing until the economy has recovered, rather than raising new taxes at this point.<\/p>\n<p>It goes without saying that nobody welcomes tax increases.\u00a0 Nevertheless, as a consequence of the way\u00a0<em><a href=\"https:\/\/youtu.be\/iFDe5kUUyT0\">this currency-creation system<\/a><\/em>\u00a0works, the government is rapidly running out of room to manoeuvre.\u00a0 In the UK, around \u00a3500bn worth of government bonds are index-linked, so that as the inflation rate rises, so the cost of servicing the debt increases.\u00a0 As James Sillars at\u00a0<em><a href=\"https:\/\/news.sky.com\/story\/surging-inflation-pushes-cost-of-servicing-govt-debt-to-december-record-of-8-1bn-12524749\">Sky News<\/a><\/em>\u00a0reported this week:<\/p>\n<p><em>\u201cInterest payments on government debt hit a record \u00a38.1bn for the month of December because of surging inflation\u2026\u00a0 The Office for National Statistics (ONS) said the cost of servicing the country\u2019s \u00a32trn+ debt pile was almost 200% or \u00a35.4bn up on December 2020.<\/em><\/p>\n<p><em>\u201cIt is because half a trillion pounds worth of government bonds are linked to the Retail Prices Index (RPI) measure of inflation which stood at 8.4% in December \u2013 its highest level since 1991.\u201d<\/em><\/p>\n<p>The problem will worsen in the spring as the new energy price cap comes into force, and as prices continue to rise across the economy.\u00a0 This sets up one of contemporary democracy\u2019s greatest flaws.\u00a0 It is precisely during inflationary periods that the people begin to demand more government spending and less taxation&#8230;<\/p>\n<p>\u2026click on the above link to read the rest of the article\u2026<\/p>\n<\/div>\n<\/div>\n<\/article>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Welcome to the age of cuts The UK government faced a barrage of criticism over its\u00a0National Insurance hike\u00a0this week.\u00a0 The tax \u2013 which\u00a0theoretically\u00a0pays for public services, pensions, and benefits \u2013 was in creased last autumn, before the political class became aware of the massive increase in gas and electricity prices coming later this year.\u00a0 However, [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[195,13992,379,380,32627,3731,13351,783,30640,31360],"class_list":["post-61819","post","type-post","status-publish","format-standard","hentry","category-economics","tag-debt","tag-debt-payments","tag-government","tag-government-debt","tag-government-services","tag-money-creation","tag-price-inflation","tag-taxes","tag-the-consciousness-of-sheep","tag-tim-watkins"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/61819","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=61819"}],"version-history":[{"count":1,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/61819\/revisions"}],"predecessor-version":[{"id":61820,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/61819\/revisions\/61820"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=61819"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=61819"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=61819"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}