Douglas Carswell

08 AUG 2016

'Economic stimulus' is just corporate welfare

Taxpayer-owned RBS lost another £2 billion in the first half of 2016. Its shares are now worth less than half of what Gordon Brown paid for them. Yet policymakers still pretend that bailing out banks with public money is good for the public.

The Bank of England's unnecessary Brexit bailout includes another £100 billion for the big banks – such as RBS - plus another £10 billion to buy corporate bonds. Mark Carney calls it a stimulus package. The more accurate name for it is corporate welfare.

Printing money to give to banks doesn't come cost free. Ordinary savers and consumers have to pay for it via higher inflation – as Carney freely admitted. In effect, the banking elites who falsely claimed the economy would collapse if the majority voted Leave will now be paid a bonus with the majority's money.

For most people, corporate subsidy is the opposite of an economic stimulus. Channelling resources from savers and wealth creators to rentiers not only increases inequality, but also hinders real economic growth. It's one reason why productivity in the UK has flat-lined.

Because of the trillions pumped into zombie banks, the global economy is drowning in debt. If we want sustainable growth, we shouldn't be expanding corporate welfare; we should be cutting it.

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