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Two Surefire Ways to Stimulate the post-COVID Economy
Eliminating the VAT until December 31 would stimulate the UK economy so much that by 2021 the economic hit from COVID-19 would be completely reversed.
Prior to July 08, 2020 the VAT in the United Kingdom was 20% on most items. However, the government sought to stimulate spending in the tourism sector by lowering their VAT to 15% on most items and admissions. Which was a bit underwhelming. To say the least.
I understand that the present UK government is Conservative-led and that caution rules their thinking, but a 5% cut to the VAT is nothing. They might as well not bother as it’s likely to have little effect.
Yes, they’re concerned about driving up the deficit in a (perhaps) uncertain economy. But let’s not feed that uncertainty by underwhelming the credit rating agencies!
Uncertain times call for CERTAINTY, not TINKERING with the economy.
Even Canada, a Country of 38-Million People Saw Fit to Run a $256 Billion Deficit to Assist Canadians
By contrast, the UK government which leads a country of 67-million people has cringed at running a deficit of £361.5 billion. That’s too little, too late, I’m afraid.
UK public borrowing to exceed £350bn with Sunak stimulus plan (FT.com)
To run with Canada and other Western nations in the post-COVID economic recovery period, the UK must do better than that!
Basic arithmetic will tell you that to meet Canada’s level of committent to its citizens, the UK with 67-million people would need to spend £451 billion in 2020.
That’s real money, delivered into the hands of Britons and British businesses to be spent in the UK economy to restart the UK economy.
Really, at this point, there’s nothing more important than restarting the UK economy; Debt-to-GDP and the present deficit are unimportant next to restarting the economy.
Rishi Sunak — nice person that he is — has listened to too many Conservative MP’s and not enough to economists, citizens, and the UK business community.
Normally, it would be a fine thing that a Chancellor of the Exchequer would pay such close attention to MP’s, as it signifies that the Chancellor is a good listener, but now is not the time to listen to overly-cautious (non-economist) Parliamentarians… now is the time to act boldly!
Regular Readers Know I Complain about Deficit Spending
But I only complain because, historically speaking (some) governments were just too lazy to oversee every pound spent in the economy and thereby engaged in deficit spending even when the economy was rocketing along with a high annual growth rate. And folks, there’s no excuse for that. It’s lazy bookkeeping and governments should be tossed from power whenever they fall below that level of fiscal responsibility.
The reason we need to be prudent with our spending during the boom times is so that we have some economic room to manoeuvre when things hit the fan, as they invariably do from time to time. Such as during Coronavirus, such as during the US subprime mortgage crisis, during times of high unemployment, or times of labour strife. And that’s the whole point of this blog post.
Governments need to be fiscally responsible during the boom times so there’s money to deal with things like Coronavirus.
Former Chancellor George Osborne was exceptionally prudent during a time of crisis (and unfairly) wasn’t able to retain his position long enough to enjoy the good times when they returned. He surely would’ve made the best of it — but was on the wrong side of Brexit — very unfortunately for him, and for the UK.
And unfortunately for Rishi Sunak — who is an easy person to like — he’s trying to please Conservative party stalwarts instead of trying to goose the economy to the same level as the UK’s competitor nations. And while we all like Rishi, that doesn’t work for him.
Please, Mr. Chancellor, put the UK’s stimulus spending to the same per capita footing as other Western economies to allow the UK to rocket out of the economic doldrums like an F-35 taking off from the deck of the HMS Prince of Wales… So important!
The Easiest Way to Stimulate the Economy…
Is by ‘topping-up’ the income of every adult British citizen in the UK to £1250 per month via a reverse income tax — thereby instantly replacing every other (overlapping and prohibitively expensive to administer) anti-poverty programme that poverty-stricken people receive assistance from in the UK, and that ‘top-up’ should also include any senior citizen who lives under the official poverty line in the UK.
For those earning over (approx) £20,000/yr. those people wouldn’t receive money from such a programme.
But for those living under the official poverty line amount, their income should be topped-up to £1250 per month in one payment from HMRC. And every pound sterling of that money will be spent in the local economy allowing that person to live and be ready to work when the economy improves, meaning 100% of that stimulus money will be spent in the economy.
Which is quite unlike when the government hands billions to corporations, where 50% of that stimulus goes straight to shareholders, many of whom may not live in the UK, spend money in the UK, nor retire in the UK. Therefore, half of any (corporate) stimulus money the government hands to corporations flies out of the UK never to be seen again. And that should be illegal. Certainly, if taxpayers knew the extent of this since 1950 there’d be a civil war.
The Coronavirus Economy NEEDS a Guaranteed Basic Income NOW! (LetterToBritain.com)
But my plea to the UK’s excellent Chancellor isn’t about plugging that particular loophole (yet) it’s about spending another £100 billion in the economy to better compete with other economies so the UK doesn’t get left behind in 2021 — and putting real money in the hands of Britons who will spend 100% of that money in local UK economies, instead of the government helping to make foreign shareholder returns more generous.
With the greatest respect, Mr. Sunak, it’s over to you!
What Lessons from the Coronavirus?
It has been reported by Johns Hopkins Medical Center that more than 100,000 people have died worldwide as a result of the COVID-19 Coronavirus.
Thus it follows that in the post-Coronavirus economy some things might need to change, as it’s doubtful that things will return to what we once considered ‘normal’ — but if we do return to that normal we might set ourselves up for another Coronavirus event that will play havoc with the economy and needlessly harm millions of people.
ONE: Let’s Be Prepared Next Time
It seems obvious that there will be another SARS or MERS health crisis. In fact, the Novel Coronavirus is itself a SARS-type virus named SARS-CoV-2 which journalists have (thankfully) named COVID-19, and it is simply the latest version of a long line of SARS or MERS type viruses that mutate at irregular intervals.
Let’s hope we never face the prospect of two highly infectious viruses at the same time, say, one mutated SARS virus (COVID-20, or COVID-21) and another mutated virus of the MERS family, because healthcare systems would reach full capacity within 7-days and millions of people worldwide would die before ever seeing the inside of a Hospital.
With that prospect in mind, let’s ensure that our politicians work on preparations for the next killer pandemic to the point that we could be in a strong enough position to take on, not one, but two killer pathogens at the same time, because given enough time, that will occur. Eventually.
But for now, let’s just be ready for the next SARS or MERS virus and we can do that by consolidating our best knowledge and practices into official government policy by passing an Emergency Infectious Disease Protocol bill in the House of Commons, soon.
How to Do That?
- The UK government should mail a package of 5-individually-wrapped surgical masks to every UK household to hang in the pantry/utility room/in the RV, or wherever appropriate.
I fully realize that surgical masks provide little protection, but in the case of unwitting carriers of an infectious respiratory virus, etc., they help to protect others from being contaminated by that person’s breath. But even more importantly is that ‘perception’ is everything. When people see other people out and about and wearing surgical masks, it will automatically cause people to remember to maintain proper social distancing! - The UK government mailout that I propose, should include an 8″x10″ plastic laminated card with a pre-punched hole so that every household can use a thumbtack to hang the infectious disease info card (and the package of masks) from a thumbtack or nail in their pantry or utility room. This card should show each type of respiratory protection (surgical, N95, and medical respirator) and the reasons for wearing each type of mask, and when to switch from one type of mask to another:
A pictogram, followed by an explanation such as; “Surgical Mask; Wear this kind of mask if you’re walking in the park or uncrowded shopping mall.” and “N95 Surgical Mask: Wear this kind of mask if you work in a crowded environment where you can’t maintain proper social distancing OR if you’re a healthcare worker OR if you work in a Senior Citizens long-term care facility.” and “Medical Respirator: Wear this kind of protection if you’re a surgeon, or other operating theatre staff, OR if you work as a pathogen researcher.” - The “8×10” card should show pictograms of each type of mask and the legitimate reasons for wearing each type of mask — and should CLEARLY summarize typical respiratory symptoms and what to do about them, such as: “If you experience any combination of fever, malaise, dry cough or uncontrollable coughing, or weakness/tiredness (or whatever symptoms you feel are appropriate for such an info card) call this toll-free number for instructions and ensure your front door is unlocked in case you can’t make it to the door.” Or words to that effect.
- A list of websites where people can re-order any of those respiratory protections online (along with the part number or model number) and have them delivered to their home, to ensure they can maintain (a minimum of 5 masks, for example) in their home, which would be helpful for most people. If the government provides such a headstart for people now and in the future, I believe that for the duration of this COVID-19 crisis and any mutated (say, COVID-20 or COVID-21, or MERS mutation) virus which may be more infectious, or more deadly (or both) UK citizens and residents will be better prepared, better educated, and better able to survive this event and the (almost certainly more dangerous) next mutation.
TWO: ‘Social Distancing’ is Now a Thing
Many people were/are completely asymptomatic — meaning, they had no symptoms at all, or may have felt a bit ‘off’ for a few days — in regards to the COVID-19 virus, however, those people may unwittingly carry on with their normal schedule and interact with dozens of people daily, thereby passing the virus on to everyone they come into close contact with.
If you have “B” type blood, you already know that you don’t catch as many colds or flu as your friends and co-workers. Which is handy for you, but you could pass infectious respiratory disease to everyone you interact with. Please use caution. Your ‘off day’ could become someone else’s major healthcare crisis simply because they don’t have the same built-in defences you have. Thank your parents and be considerate to others. Please.
While in public, we’ll be urged to maintain social distancing, which is difficult to get used to until you do get used to it, and then you’ll never go back to the old informal distancing rules.
Every year, I expect that a call will go out via the media telling people there’s a novel coronavirus or MERS-type virus making the rounds and to take appropriate precautions. And we all know that the best way to avoid such a virus is to lock yourself in your house until the crisis is over — which isn’t a lot of fun. But the second-best way to avoid contracting such an infection is to maintain proper social distancing, which isn’t that difficult. In addition to social distancing, wearing a surgical mask or an N95 mask will help, and even better, if you have the virus, you won’t be passing it along to everyone you come into close contact with. Unless you take it off, of course.
The UK government should create legislation that requires transportation operators to reconfigure their seating arrangements to allow for proper social distancing. In trains and buses, this could take the form of perimeter seating around the entire train car or bus, while in airlines, seating that faces each other might be the way to go. “Look ma, I’m flying backwards!” Seriously though, perimeter seating in airlines, with opposing seats in the centre of the aircraft would maximize passenger safety and still allow a large number of passengers and permit two aisles. On ferries, similar seating arrangements could be made and onboard restaurants and cafeterias should be able to reconfigure their seating area to opposing (and easy clean fabric) seating to maintain social distancing rules. Remember, when you’re eating your prime rib or vegan tortellini you can’t wear a mask, so the seating plan in those areas must consider passenger safety more seriously.
Some sidewalks in the UK are barely wide enough for one person let alone the busyness of the tourist season, therefore, cities and towns across the UK need a complete rethink of their pedestrian areas. In many cities around the world we’re seeing typical four-lane city streets turned into two-lane cobblestone streets that are only open to buses or trams. Allowing taxicabs and limos seems appropriate too, but not passenger cars or motorcycles. By converting a four-lane road into a two-lane road, it allows wider sidewalks for people to maintain the recommended social distancing rules. This can look very attractive and many cities have succeeded in this in recent years.
Working from home four days per week could become the new normal for many office workers and others who can work from home. Imagine a worker assembling 250 car mirrors per day (or 250 car tail lights per day) at a factory; Now, imagine that worker doing the same in their (formerly) two-car garage. It’s the same thing except for the location. The worker gets paid a standard price for each piece they assemble instead of payment by the hour, yet all other employee benefits for that worker would remain the same. FedEx or the automobile manufacturer’s own delivery vans could pick up and deliver the parts from the home worker. Final assembly, of course, would be done at a large factory designed exclusively for ‘just-in-time-delivery’ of the necessary parts.
Shopping online is one way to limit exposure to potentially infected persons, it also frees-up the roadways for transport trucks and delivery vans and ends the daily gridlock that spews billions of tons of pollutants into the air which, as we now find out, breathing those toxins for a few hours every day further weakens our immune system response to infectious disease. Seems obvious in retrospect, doesn’t it?
THREE: Government Policy Must Allow the NHS to ‘Hit the Ground Running’
Boris Johnson’s government has handled this healthcare crisis about as well as any government on the planet.
However, when the next SARS or MERS-type virus hits, the NHS should be fully stocked with every PPE they need, they should have standing arrangements with every available airport hangar or unoccupied office tower or movie theatre, etc., they should have millions of test kits which should be used on each person who enters a Hospital (with or without symptoms) and test kits should be used to test every passenger arriving in the country — before they debark the aircraft, ferry, cruise ship or pleasure craft — and they could be notified via SMS if their test proved positive, allowing them to self-isolate or see a Doctor, as appropriate. This would give the infected person a jump start on their treatment and provide the NHS with almost realtime tracking of infected persons arriving in the UK.
Finally, the NHS needs an entire fleet of state-of-the-art Hospitals that are built to suit the modern NHS. Yesterday’s hospitals, built in the 18th, 19th and 20th-centuries, just aren’t up to scratch. Some of them cost more than £1 million per month to heat let alone pay the lighting bill. Many aren’t fit for purpose, or are located in the worst possible place now that entire cities have sprung up around them over the past 10 or 20 decades. Some NHS facilities are simply too small to serve regular needs let alone having enough capacity to handle a major epidemic. Ten new Hospitals need to be built every year until the NHS reaches 130% capacity so that it can then offer so-called medical tourism and thereby earn valuable foreign cash from its foreign patients. Each new Hospital should be much smaller than the 1950’s era monster-sized facilities. Modern Hospitals need a smaller footprint, they need to be easily accessible, and the UK needs many more locations — more + smaller + energy efficient Hospitals, instead of few + large + energy inefficient + barely fit for purpose Hospitals.
MORE, SMALLER, ENERGY EFFICIENT HOSPITALS are the future.
Captain Tom Moore Raises Millions for the NHS
And to end on a positive note, let’s give a warm shoutout to the UK’s 99-year-old Captain Tom Moore who has raised over £18 million since April 10th for NHS Charities Together, by walking laps in his back yard. Thank you again, Captain Moore. He is 2020’s best example of the spirit of the United Kingdom. Hats off!
You can still donate HERE or SEE HOW MUCH HE’S RAISED SO FAR, if you like!
There’s a petition that already has more than 500,000 names on it to award this great military warrior and NHS hero the George Cross, please consider signing it HERE.
Resetting the UK Economy After Coronavirus
Things will never return to what has been thought of as ‘normal’ business in the United Kingdom following the biggest threat to Britons since WWII, yet there’s two paths forward where the country can either ‘survive’ or ‘thrive’ after Coronavirus. And that’s the focus of this blog post.
Here’s a short list of things that could be done in order to a) Prepare the UK for the next pandemic, b) Protect Britons from retransmission of a future SARS or MERS virus or other contagious pathogen, c) Build Resiliency into UK infrastructure, and d) Stimulate the UK economy to allow the country and its people to thrive, going forward.
Prepare, Protect, Build Resiliency, Stimulate
For me, ‘surviving’ isn’t enough. What the UK needs to do after any kind of negative event is to ‘thrive’.
When you’re 68-million people on a small island in the Atlantic Ocean that’s recently cut the cord with the EU, and still hasn’t reintegrated with the global economy, nor even the (eternally patient) Commonwealth of Nations, you’ve got to come out of a healthcare + economic crisis with a solid plan and impressive momentum behind that plan.
Let’s talk about what can and should be done as the UK comes out of the Coronavirus emergency.
Four Ways to Repair the UK Economy & Inoculate it from the Next Pandemic, While Supercharging the Economy Now
- Coat all publicly handled surfaces with copper. As you may know, copper kills germs, viruses, and bacteria upon contact in only a few seconds, therefore, such commonly handled surfaces like turnstiles, handrails, push-to-open door plates, door handles and door knobs, and the taps in public washrooms, and the buttons on the ATM or any vending machine should be coated with copper. Copper acts so powerfully against germs that even 25% copper content is enough to do the job. Plenty of coins in the world have a high copper content, yet their appearance is like that of pewter or brass, so if you don’t like the colour of copper, turnstiles and more, can appear to look like pewter, aluminium, or brass. Killing germs on frequently handled surfaces is a great way to stop retransmission of a pathogen to everyone who passes through that turnstile. How to get it done? The UK government should guarantee zero-interest loans to rail companies, airlines, ATM and vending machine operators, and to cities and towns to incentivize them to coat (electroplate, anodize, or otherwise layer) such surfaces with copper or copper amalgams with a copper content of 25% or more.
- Designate who works in ‘Essential Services’ and allow them to continue their duties unaffected by future ‘stay at home orders’. We can’t live without Doctors and Nurses, nor can we live without food and drink, nor without heat and light. And, it’s always nice to have police, fire and ambulance services available on speed dial. Similar is true of the military. Where would we be without them? So, thanks again to those people every day — all the way back to the Great Fire of London in 1666. How to get it done? The UK government should require each department to create a list of jobs in their department deemed ‘essential services’. Also, the UK government should consult with UK industry for a list of job titles considered ‘essential services’ and determine the total number of people required to staff those essential service positions — for the purpose of creating a massive database of people deemed ‘essential’ during any crisis. Maybe those people should be issued a passcard and a matching sticker for their car windscreen allowing them to automatically pass through any police checkstop, park their car for free (Doctors and Nurses shouldn’t be getting their car impounded when they’re busy saving lives, for example) and essential workers should be paid (by the government) an extra £500 per each full or partial month of any crisis (even if it’s a local ‘State of Emergency’ situation where local officials have duly informed the UK government about the emergency) to cover exceptional costs such as the worker having to stay in a hotel after working a 16-hour emergency shift rather than them driving home overtired, and then doing it all over again the next day.
- Consolidate all UK Department of Work and Pensions unemployment insurance, welfare/Universal Credit, and government pensions systems into one payments system operated by HM Revenue and Customs. At present in the UK (and most Western countries) there are many government departments offering similar or the same services, which represents a HUGE overhead cost and leads to massive inefficiency in government. All payments should be paid via the ‘reverse income tax’ method to vastly improve and streamline UK services to persons. How to get it done? HM Revenue and Customs should ‘top-up’ the income of every adult Briton who is living under the national poverty line to £1200 per month. Which is cheaper than continuing to operate a multiplicity of government departments dedicated to solving the financial, housing, and legal ills of everyone in the country — especially when you factor-in poverty-based crime and related policing, court, and incarceration costs. It would result in a lowering of taxes by tapering the astonishingly high overhead costs for several government departments — and a tax increase WOULD NOT be required. For example: If a person earns more that £1200 per month, they get nothing from this HM Revenue and Customs programme. If they earn an average of £1000 per month (as reported on their previous year income tax form) they would automatically have £200 added to their bank account via direct deposit each month. Millions of entry level workers, senior citizens, some unemployed persons, and others who earn less than £1200 per month would be automatically topped-up to that amount, but only if they’ve filed their income tax return for the previous year, and only if they’re over the age of majority. It can’t be emphasized enough: The overhead savings alone for the government would more than pay for this improvement and small businesses would benefit from reduced property crime + high insurance rates, and the threat of personal theft (getting ‘mugged’) would practically disappear. Remember, homeless people are only homeless because they don’t have funds to pay rent, therefore, they turn to crime, drugs and other unpleasant means to stay alive. And the gross total cost to the UK annually is in the billions. Take away the reason for the problem and suddenly, there’s no problem. So easy. And prevention is always cheaper than solving a deeply-entrenched problem!
- A number of major national infrastructure programmes should be made ‘shovel ready’ as soon as this crisis ends, as nothing says ‘Crisis Over!’ like plenty of jobs ready for people at the end of any emergency. It’s the news that people need to hear during a crisis as it will keep hope alive and keep them working towards a solution instead of them sinking into the abyss of worry, doubt, and substance abuse, or even worse. ‘Here’s a shovel. Now go plant a billion trees!’ is one way to help the bottom-two economic quintiles get back to a normal life. Anyone, even workers who live (whether above or below) the national poverty line might want to spend a few hours doing that at the weekends to make-up the income they’ve lost during the COVID-19 crisis. ‘Let’s reclaim a hundred square miles from the sea and build luxurious golf resorts there!’ might be another way to create millions of badly needed jobs at the end of any emergency including the present coronavirus crisis. Adding fill to the shallower areas of the UK coastline can build sea level rise resiliency and help to prevent the normal process of erosion of land by the sea while creating spectacular tourism areas (jobs, jobs, jobs!) for those who love ocean views. Seen The Palm Dubai, anyone? Dubai was a sleepy fishing village not so long ago. ‘Here’s a hammer. Now go install 10-solar panels on every roof in the UK’ and the UK government should provide zero-interest loan guarantees for any home or business owner willing to have such an array installed on their roof that contributes surplus energy to the national grid. ‘Here’s a tractor. Now go make the UK 100% self-sufficient in food within 10-years!’ and again, the UK government shouldn’t grant such money, it should provide zero-interest loan guarantees to those able to move the UK closer to that goal. Obviously, farmers in the UK won’t be growing coconuts or bananas, but any non-tropical fruit and veg should be doable in southern England. If UK policy is right and the financing is kept at zero-interest, UK farmers and ranchers should be able to accomplish the task with ease and have enough capacity to export significant quantities of UK produce. And the last suggestion is to ‘Get Britain Working Again!’ (but From Home) after the COVID-19 crisis ends by increasing internet and telephone bandwidth and by improving PC programmes that help people to work from home as efficiently as they do at their regular office, thereby allowing fully half of all Britons to work from their brand new home office. Which, of course, (you knew I was going to say it, didn’t you?) should be financed via zero-interest loan guarantees courtesy of the UK government.
You’ll Notice my Suggestions Don’t Cost Anything (net) and They’ll Save the UK Billions while Supercharging the UK Economy and Solving Many Social Ills
You’ve got to like that, whether you voted Conservative or Labour!
Letter to Britain 