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JP Floru: Poor savers make rich pickings

Florujp By JP Floru

Self-reliance must rank in the top three Conservative values; perhaps together with producing growth and taking care of our nearest and dearest (I’m open to suggestions for even better Conservative values, and am looking forward to the Comments below!).

Key to self-reliance is saving.  Call it frittering away.  Beavering away.  Saving for your old age.  Or yes, THRIFT, the age-old home makers’ wisdom, much derided by champagne socialists.  Self-reliance is the opposite of socialism, for socialism means the socialisation of spending.  For socialists it is always somebody else who pays, preferably an anonymous state.  The added bonus being that widely dispersed contributors don’t tend to whine too much. In a multi-billion pound state spending spree it is difficult to know how many pennies are yours.

Fleecing savers was second nature to the last Labour government.  Deceptively called ‘making the rich pay’ (many savers are in fact not very wealthy at all), it brought us the raid on pensions and means testing.  Given those two factors, the BBC’s money programmes’ never-ending promotions for pension saving verge on being dishonest advice. 

And now our currency, and therefore our savings, are being debased.  Today, the once noble goal of limiting inflation to 2% maximum is not worth the paper it’s written on.  Even the inflation target itself was debased, when Gordon Brown changed the basis for the target from RPI to CPI (substantially lower).

At 4.4%, inflation is now at its highest since October 2008 according to the Consumer Price Index.  Which does of course not include a housing element (we are assumed to sleep on the street) – good old Retail Price Index, which does, stands at 5.4%. 

So most of you with savings are probably losing money.  This is not an immediate concern of present-day politicians; by the time you retire and your savings are worthless, they will be long gone.   The saccharine misnomer of Quantitative Easing is the closest they have come to telling you what this really is: printing money and shrinking your purchasing power. 

The left will say that state support of the economy must continue as otherwise growth will go down.  Debasing your savings means of course that you cannot invest to make the economy grow.   It is therefore a lie to claim that state spending makes the economy grow as the private sector is shrunk at the same time.  And it is worse, as state spending is always less efficient than private sector spending, and therefore 1% growth in state spending shrinks the private sector by more than 1%.  A saver is a squirrel: what he saves is postponed spending.

Continuing the rampant inflation means continuing attacking self-reliance.  It is an effective tax increase.  It means growing the public sector at the expense of the private sector.

Debasing the currency is un-Conservative to the core.  Sound money is what we need.  


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