Dear Rishi Sunak

In the next months you have the opportunity to make the UK Economy among the strongest in the world, and every pound you invest at the most necessary level comes back to the treasury in taxes, having done untold good within that economy. This isn’t easy for European money and the countries of the EU might struggle; we don’t need to struggle like them.

You might be familiar with the “Window Cleaner Sketch” where Brian is invited to 11 Downing Street and negotiates a payment of £100 to clean the front windows of the house next door. The Chancellor instructs the Treasury to deliver £66.67 by messenger, and tells Brian that the actual cost was surely £83.33 plus 20% VAT, and that the Income Tax on that was a further £16.66 if he pays tax at the normal rate. Brian agrees that he does; what does the Chancellor take him for, a tax dodger? Immediately Brian goes round to the nearest open-air market where Dorothy, a stall holder, sells him some warm corduroy trousers and a pair of knitted socks, costing exactly £66.67. Again, a third of that will travel back to the Treasury: £11.11 VAT and £11.11 Income Tax. Dorothy pays herself the remainder, £44.45 as wages, having sold nothing else all morning. Thus £55.55 has already been returned, or is earmarked for return to source while £166.67 of economic activity has taken place. Dorothy meets her kids for lunch, where the bill is £44.45 after she has agreed a discounted price with Tuan the owner of the restaurant. This includes £7.41 VAT on food eaten in, and Tuan pays Anh the waitress £37 for the afternoon shift, deducting a further £7.40 for PAYE Income tax. Thus £29.60 remains in the economy, and not one day has yet elapsed. Almost £250 of necessary economic activity has taken place because someone had remarked to Rishi Sunak that the windows in Downing Street seemed to have lost their sparkle, not unlike one or two people behind them. Anh treats her friend Billie to watch streamed footage at the local cinema; it’s an opera company now almost defunct because when furlough ended the managers made redundant most of its technicians, electricians, musicians, and a number of singers. Anh and Billie pay £30 for two tickets of which £5 is VAT. They enjoy hearing opera/operetta sung in English but now the remnants of the organisation are limited to performing unaccompanied dirges in the dark with a group of managers married to partners who work as accountants. The Cinema takes £25 after VAT and pays the girl behind the ticket window and the Ice-cream seller £12.50, who each takes away a tenner as £2.50 goes in income tax. These two, Track (from his jogging bottoms) and Tracie go out locally for “a fish and chip supper,” costing them their wages. Of their £20, a third will be VAT and Income Tax. By the weekend only £13.33 remains, though around £300 has reverberated around the economy of South West London. In another few weeks, there is just £1.50 not yet on its way back, and about £350 to £370 has been spent in various businesses. That £1.50 is in the pockets of savers, in contingency funds of businesses, or trousered by people who will stash it off-shore. Whatever, it cannot contribute to inflation while there are goods and services to be purchased. That so-called ‘deficit’ from that £100 needs to be larger and of course if money is spent on zero-VAT items such as fruit and veg, baby clothes, books and newspapers, then money lasts a little longer than otherwise. On weekend TV Rishi is asked where he’s been getting “all this money” from and replies, “Andrew, I am the Money;” cash injected at the lowest, subsistence level of the economy has Trickled Upwards. Pitched a little higher, to nurses, teachers, technicians, pubs and cafés, it can actually go further than £370; check your spreadsheets. Don’t be afraid to put money into the subsistence economy; it doesn’t need to be ‘borrowed.’ All money is debt anyway (It says so on the banknotes.) The furlough and more are not inflationary; we only get into inflation when the supply of money can’t find anything to buy or employ. As soon as we get into an inflationary situation you will know before anyone.

…someone remarked to Rishi Sunak that the windows in Downing Street seemed to have lost their sparkle, not unlike one or two people behind them.

“Andrew, I am the Money;”

Don’t be afraid to put money into the subsistence economy; it doesn’t need to be ‘borrowed.’ All money is debt anyway (It says so on the banknotes.)