Lets Reform Money!

Reforms. A term coined by the Tories to help implement round after round of ideological policies. So far we have reformed the welfare people of this country receive, including cutting the Tax Credits of workers, which apparently will "make work pay". We are trying to reform or "modernise" Trade Unions by making it almost impossible to hold a legal strike. We have reformed local councils by slashing an smashing their budgets. The list of these "reforms" goes on.

The most recent suggested "reform" has come from Andy Haldane the chief economist at the Bank of England.

This time adopting the same mantra as the Trade Union Bill, Haldane has suggested we could "Modernise" Money in the UK by getting rid of cash and replacing it with "Digital currency". Oh this sounds exciting, futuristic and a real step forward you may think. That is until you dig deeper and understand the motives behind this modernisation. This brainwave comes just after the Bank of England announced it may be necessary to implement a negative interest rate. This would mean that when you normally receive your interest payments on your account, instead you would be deducted the interest rate.


How will this effect you? Well if you have done what the government describes as "the right thing" and managed to save, then sit back and watch them savings decline. Remember there is no cash any more so you wont be able to rush to the bank to take that money out. If you find yourself in the position, as so many do in this country, that you come to the end of the month and reach 0 or less in your account then get spending! Your going to have to spend your money quickly as you probably can't afford for any money to be taken from your account. Again remember you can't go and withdraw it in cash as it simply does not exist any more.

The obstacles to implementing a cashless society are enormous. Just about everyone uses cash at some point in their lives. Catching a bus or a taxi, paying the window cleaner or milk man, shopping at the market or car boot sale. There are just too many examples in which people and businesses rely on cash and where replacing it would both be expensive and impractical.

All of this is designed to give the economy a boost, get people spending instead of saving and spending faster. It is a strategy that can work in the short term, but leads to long term problems if it remains. There are other ways to boost the economy after all, such as investment in infrastructure and creating jobs. So perhaps this is one "reform" we just don't need. Perhaps we can do without this sort of "modernisation". Perhaps we need to seek alternative radical solutions. Perhaps its time to talk to Richard Murphy about Corbynomics. Perhaps.




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