Rishi Sunak is standing outside Downing Street saying that the newly chosen MP for Rochdale, elected yesterday, is the reason why he must crush our democratic freedoms. In the process he appeals to theocracy whilst totally undermining the democracy he claims to support. The reality is that if there are extremists in the country it is those members of his party who want to create divisions in this country for their own small minded gains.

Quite extraordinarily, leading politicians, including Kier Starmer and Rachel Reeves have in the last few days returned to talking about the country maxing out its credit card, just as David Cameron did in 2015. This is utterly absurd. A thread… [This is a long thread. If it appears to stop part way through, push the button to ‘see more replies’ and the rest should appear.]

Labour says it cannot now afford to spend £28 billion a year to deliver the investment in the climate transition that we all know we need. Let’s leave the politics and even the climate bit aside. Let me just look at the affordability bit. A thread…. Labour announced its green investment plan in 2021. And nothing much has changed since then, to be candid. For example, by the time it gets to office inflation will have been and gone.

There is justifiable outrage right now about the fact that the Post Office has been able to prosecute sub-postmasters itself based on data it generated. I get that anger, but we should remember that HM Revenue and Customs do this every day to thousands of people…. [This is a long thread. If it appears to stop part way please press the ‘See more replies’ option below the tweet where it appears to run out and the rest should appear]

War, of some sort, has begun in the Red Sea and Yemen. The UK is involved. It is likely that there will be action for a while. Ignoring the ethics of the engagement, for now, what are the economic consequences? A thread…… Because this war is going to make passage of the Red Sea more, rather than less, dangerous for the time being it is inevitable that for an unknown period the cost of shipping goods and raw materials from the Far and Middle East will rise. Suez is going to be out of action.

Without wishing to oversimplify things, there is a binary choice in politics. You can either emphasise the needs of the individual or of society. For the first time in more than a century, the UK's two leading political parties are emphasising the individual and not society. No wonder so many are disenchanted with politics. Only those who are willing to turn a blind eye to the needs of others are now represented by the mainstream choices presented to us. Anyone who cares about society has no one to represent them.

Sir Howard Davies, chair of NatWest, claimed on Radio 4 today that UK interest rates were low for a decade because there was a glut of savings and a shortage of investors to lend that money to. Should a man who doesn’t know how banking works be in charge of a bank? A thread… Since 2014 the Bank of England has acknowledged that when a bank makes a loan it does not use saver’s funds. Instead, new money is created by the exchange of promises to pay between the bank and the borrower. As it noted, that is how all commercial bank money is created.

The Telegraph is saying the Tories are going to change the UK's fiscal rules to catch Labour out in the run-up to the general election. This is because they think that we're all terrified of the national debt. We shouldn't be, and what they're proposing is bonkers. A thread... First of all, although the government claims that the national debt is nearly £2.7 trillion, it isn't. It's actually only a bit over £1.6 trillion. The rest is created by what I think to be false accounting. I explain why and what this means here. taxresearch.org.uk/Blog/2023/12/2…

Of all the taxes in the UK that Jeremy Hunt could cut, inheritance tax is easily the most stupid right now. Doing so would save millions for a few already relatively rich people, do nothing for the economy, and increase inequality. A thread…. Inheritance tax is paid by about 27,000 estates of people who have died each year, according to the latest data. That means just 1 out of every 25 estates are subject to an inheritance tax charge.

The Government has apparently drawn up plans to broaden the definition of extremism to include anyone who “undermines” the country’s institutions and its values.

I do that.

Should I be worried? A thread.... [Please note this is quite a long thread. If it appears to run out, just click the button offering to show you more replies]

The Bank of England has kept interest rates on hold at 5.25%.

It says it may still need to raise rates if the war in Israel / Gaza impacts prices.

It claims this is not the time to cut rates.

And each of those decisions and claims is wrong. A thread.... The Bank of England says interest rates need to be high to cut inflation.

Inflation is falling though, but not because of high interest rates.

For example, next month, inflation will fall because gas prices have fallen recently.

There appears to be a collective sigh of relief around the economy because the Bank of England has held its base rate at 5.25% today. But let me assure you that the insanity of their interest rate policy is continuing. A short thread.... I would love it to be the case that the Bank of England had at last begun to see sense on interest rates and that it had begun to end its ruinous decision-making that has as its one simple goal the driving of the UK into recession, but it really has not.

When I started publishing the Taxing Wealth Report I suggested that the increase in wealth is undertaxed by £170 billion a year in the UK. In response tax lawyer @DanNeidle has said this is nonsense. It’s a pity he did not read what I said before commenting. A thread… This is the tweet Dan Neidle published:

https://twitter.com/DanNeidle/status/1700405941055762813

Everywhere you look there is reason for the UK government to spend more money. Health, schools, water, transport, housing and energy. But the government and Labour say there is no money left. That, I suggest, is simply not true. A thread….. The case for more government spending is obvious. The money to pay for it comes from three sources: borrowing, money creation (or QE) and taxation. If inflation is to be controlled, tax has to be in that mix.

Will Hutton has an article in The Observer this morning saying that Britain is bust.

It isn’t. The UK has total wealth of more than £15 trillion.

A short thread.... The problem is not that the UK is bust. The problem is that the UK will not share its wealth in a way that produces well-being for everyone.

There is what might be described as an unfortunate side effect to the Bank of England’s policy of raising interest rates. It is that the UK’s main High Street banks might be paid £18 billion this year for sitting on money that the government quite literally gave them. A thread…. Way back in 2008, you might recall that there was a banking crisis. Without government intervention most of the UK’s banks would have failed. As it was many, including Lloyds and the Royal Bank of Scotland (now NatWest), plus others now long forgotten, did.

I am aware that some people here are quite upset by my comments about Labour. They presume as a result of them that I am trying to upset Labour’s chances of being elected, or that I am somehow a traitor to the left-of-centre cause. I am not. A thread… I have always made clear my distaste for the Tory-led governments that we have suffered since 2010. Their policies have been divisive, increased inequality and prejudice and reduced the well-being of many. They have all been economically incompetent. Can I be clearer than that?

If the media was to be believed, the fact that there are people without access to bank accounts in the UK has only just been discovered. Nothing could be further from the truth. The issue is real and ongoing. Let's have some facts. A thread.... The Financial Conduct Authority (the FCA) has responsibility for monitoring this issue. It issued a report on it earlier this year. The data in this thread all comes from there. fca.org.uk/publications/f…

I cannot be alone in being bored by hearing and seeing Nigel Farage in the media talking about the future of banking as if it was all about him, when that is anything but true. A thread... I also do not much care that Nat West decided to close his bank accounts. I do not think this was woke capitalism. I think it was the result of perceived risk, ineptly appraised. That is a minor issue.

I tried posting a thread this morning on what I think to be the massive errors made by the Office for Budget Responsibility when forecasting the UK's economic future. Tne boosting went wrong, so here it is in a different way...

The Office for Budget Responsibility (OBR) issued a report this week saying the UK's national debt is out of control. It forecasts it will grow to maybe 300% of GDP by 2070. But there were massive errors in the report and a lot of handwringing and no solutions. So, a thread.... If the OBR is to be believed, the UK is heading for economic hell. It isn't. It may be heading for climate hell, but assuming we address that issue, economic hell is not on the agenda.