Bernard Madoff’s tenure as holder of the title of the biggest swindler of all time may soon be over as the huge Ponzi scheme which has been operated by the British government is finally unmasked.
The essential element of a Ponzi is to pay out those wanting to withdraw their money with the new money provided by the mugs coming in. When I heard recently that the biggest employer in the West Midlands is now Birmingham City Council I realised the game would soon be up. Essentially, with any employee, about 30% of their pay is deducted as government taxes and then further taxes are levied through council tax and VAT; probably 50% of earnings find their way back to the government. In the case of state employees this tax provides their pay, so you are paid out of tax this week and then tax is deducted which will help to pay you next week, from which tax will be deducted which will…. and so on. Of course this is always a diminishing figure and requires topping up with extra money, the ‘new money’ vital to a Ponzi.
This ‘new money’ can only come from taxes on non-government money but successive governments have either, actively persecuted, or destroyed, huge swathes of the private sector and the nationalised primary producers such as coal and steel. In the past, the best British industry could hope for was complete indifference, at least then they knew where they stood – nowhere. The price for this attitude of either crass ignorance(Tory) or doctrinaire hostility(Labour) has been the almost total disappearance of the manufacturing sector and, currently, the possible flight abroad of the service industries like banking, insurance and shipbroking. With them has gone the tax income necessary to pay off the punters.
So will the Serious Fraud Office mount an investigation into the Treasury? Will we see Chancellors hiding their faces as they are hustled in to police cars? Will the surviving Prime Ministers of the last fifty years plead diminished responsibility?
We can dream can’t we?