Money Creation and Society

Debate between Steve Baker and William Cash

Thursday 20th November 2014 Commons Chamber

[Sir William Cash (Stone) (Con)]

My hon. Friend is making an incredibly important speech. I only wish that more people were here to listen to it. I wonder whether he has read Nicholas Wapshott’s book about Hayek and Keynes, which deals very carefully with the question that he has raised. Does he agree that the unpleasantness of the Weimar republic and the inflationary increase at that time led to the troubles with Germany later on, but that we are now in a new cycle which also needs to be addressed along the lines that he has just been describing?

[Steve Baker]

I am grateful to my hon. Friend. What he has said emphasises that the subject that is at issue today goes to the heart of the survival of a free civilisation. That is something that Hayek wrote about, and I think it is absolutely true.

If I were allowed props in the Chamber, I might wave this 100 trillion Zimbabwe dollar note. You can hold bad politics in your hand: that is the truth of the matter. People try to explain that hyperinflation has never happened just through technocratic error, and that it happens in the context of, for example, extremely high debt levels and the inability of politicians to constrain them. In what circumstances do we find ourselves today, when we are still borrowing broadly triple what Labour was borrowing?

--- Later in debate ---

[Steve Baker]

The hon. Gentleman is quite right, and I welcome the spirit in which he asks that question. The vast majority of us, on both sides of the House, live on our labour. We work in order to obtain money so that we can obtain the things we need to survive.

The hon. Gentleman pre-empts another remark that I was going to make, which is that there is a categorical difference between earning money through the sweat of one’s brow and making money by just creating it when lending it to someone in exchange for a claim on the deeds to their house. Those two concepts are fundamentally, categorically different, and this goes to the heart of how capitalism works. I appreciate that very little of this would find its way on to an election leaflet, but it matters a great deal nevertheless. Perhaps I shall need to ask my opponent if he has followed this debate.

My point is that if a great fountain of new money gushes up into the financial sector, we should not be surprised to find that the banking system is far wealthier than anyone else. We should not be surprised if financing and housing in London and the south-east are far wealthier than anywhere else. Indeed, I remember that when quantitative easing began, house prices started rising in Chiswick and Islington. Money is not neutral. It redistributes real income from later to earlier owners—that is, from the poor to the rich, on the whole. That distribution effect is key to understanding the effect of new money on society. It is the primary cause of almost all conflicts revolving around the production of money and around the relations between creditors and debtors.

[Sir William Cash]

My hon. Friend might be aware that, before the last general election, my right hon. Friend the Member for Wokingham (Mr Redwood) and I and one or two others attacked the Labour party for the lack of growth and expressed our concern about the level of debt. If we add in all the debts from Network Rail, nuclear decommissioning, unfunded pension liabilities and so on, the actual debt is reaching extremely high levels. According to the Government’s own statements, it could now be between £3.5 trillion and £4 trillion. Does my hon. Friend agree that that is extremely dangerous?

[Steve Baker]

It is extremely dangerous and it has been repeated around the world. An extremely good book by economist and writer Philip Coggan, of The Economist, sets out just how dangerous it is. In “Paper Promises: Money, Debt and the New World Order”, a journalist from The Economist seriously suggests that this huge pile of debt created as money will lead to a wholly new monetary system.

I have not yet touched on quantitative easing, and I will try to shorten my remarks, but the point is this: having lived through this era where the money supply tripled through new lending, the whole system, of course, blew up—the real world caught up with this fiction of a monetary policy—and so QE was engaged in. A paper from the Bank of England on the distributional effects of monetary policy explains that people would have been worse off if the Bank had not engaged in QE—it was, of course, an emergency measure. But one thing the paper says is that asset purchases by the Bank

“have pushed up the price of equities by as least as much as they have pushed up the price of gilts.”

The Bank’s Andy Haldane said, “We have deliberately inflated the biggest bond market bubble in history.”

High Speed Rail (Preparation) Bill

Debate between Steve Baker and William Cash

Wednesday 26th June 2013 Commons Chamber

[Mr William Cash (Stone) (Con)]

rose—

[Steve Baker (Wycombe) (Con)]

rose—

Accountability and Transparency in the NHS

Debate between Steve Baker and William Cash

Thursday 14th March 2013 Commons Chamber

[Steve Baker]

Of course I would rather that the money was spent on standards and performance and not on prosecutions, because I would rather the problems did not occur. I do not wish to lecture the right hon. Gentleman, and I feel sure he did not quite mean it this way, but if we do not intend to apply the law of corporate and individual gross negligence manslaughter, let us repeal it, or amend it so that it does not apply to the NHS. I have to say to the right hon. Gentleman that it does apply to the NHS and that in certain cases, as Francis has said, things are so bad it should be applied.

I ask the Government to look at democratic control. I am delighted that the Secretary of State is reforming the Care Quality Commission, but how can we make sure that there is more direct accountability, perhaps to the health and well-being boards, and the overview and scrutiny committees? How can we give them the power to sanction or perhaps even, through due process, dismiss a board or a chief executive?

I think here of Paul Ryan, a man with vascular disease who had lost one leg already when he found himself sick. He had four days of GP visits and spent nine hours in accident and emergency on a Friday. He was then sent home, having had an MRI scan, after which he was expecting to lose his leg on the Monday. He was told to expect a phone call, but no phone call came. The Ryans eventually called 999 and were told that it was better to get a GP. The GP arrived and called an ambulance. It took two hours for that to arrive and Paul Ryan died in the ambulance with his wife on the way to hospital.

[Mr Cash]

Does my hon. Friend agree that accountability does reside also with the Secretary of State, as set out in the national health service legislation? That is essential in relation to our functions in this House and those of this Secretary of State and former Secretaries of State.

[Steve Baker]

I am grateful to my hon. Friend for his point, although it has been examined at length, so I do not want to go down that rabbit hole with him—I hope he will forgive me.

The post-mortem on Mr Ryan indicated that he probably would have suffered the same fate in any event, but the system let the Ryans down—Mrs Lyn Ryan made that point to me and to the local newspaper. Unfortunately, the case plays right into the fears of the public in Wycombe, because we lost our accident and emergency facility in 2005 and we recently lost our emergency medical centre. We have just had two similar repeat occurrences of the minor injuries unit failing to refer people across the car park into the excellent cardiology and stroke units. We have seen an enormous range of little problems, for example, an 85-year-old lady with dementia was sent home in a taxi at 2 am in just her hospital gown. This cannot go on, and the public’s concerns are justified. The trust is being investigated by Sir Bruce Keogh and although I have heard good reasons why its mortality levels are justified—they relate to running hospice care, in particular—this must be taken as an opportunity to improve things.

Finally, I wish to make a point on transparency. Yesterday, I spoke to Anne Eden, the chief executive of the trust. I am not going to put on the record the entire content of the conversation, but when I told her that I intended to raise this issue of corporate manslaughter on the radio this morning, I was told, in terms, “To protect the reputation of the Buckinghamshire trust, legal action would be sought.” This is a matter of public interest being raised by a Member of Parliament in good faith, but I have had to—[Interruption.] To be fair to her, she was talking about the radio. But I have had to rely on privilege to protect myself from being sued on this matter. It is not acceptable that such a matter should have to come to a Member of Parliament, simply to rely on privilege. The situation reinforces something I have experienced again and again since becoming an MP: second-hand rumours and half-truths about the state of health care in Buckinghamshire. I have encountered: people stymied; people thinking it is helpful to give half a rumour to a friend to repeat to me so that I can know how bad things are; and people’s frustration at not being able to do anything. I know that Buckinghamshire Healthcare NHS Trust is obviously close to your heart, Mr Speaker. I know that it expects to satisfy Sir Bruce Keogh, but it is really time for proper accountability and that must include the courts.

National Referendum on the European Union

Debate between Steve Baker and William Cash

Monday 24th October 2011 Commons Chamber

[Mr William Cash (Stone) (Con)]

A few months ago the Prime Minister asked me after a debate to write to him about my views on the European Union, so I wrote him a pamphlet called “It’s the EU, stupid.” That was a reference not to him, but to Bill Clinton’s recognition that the economy is at the heart of the issue. In just the same way, I believe fundamentally, as I have set out in the pamphlet—I will quickly encapsulate some of the thoughts it contains—that this is first of all a matter of principle. The referendum issue has been going around since before the Maastricht referendum campaign. I voted yes, as it happens, in 1975, but since then we have seen the accumulation of powers and the broken promises, betrayals and prevarication. The argument is that it is never the right time to deal with these issues, but that is the problem, and the British people feel that they have been betrayed by a failure to deliver on those promises.

[Steve Baker]

I would have voted yes in 1975, but does my hon. Friend agree that the EU has gone far beyond that which is necessary to guarantee peace and prosperity?

[Mr Cash]

Yes, indeed, and I will go further: the EU has created a situation in which it actually damages our economy. That is the problem, and that is the reversal of the situation, with massive over-regulation—£8 billion a year, according to the British Chambers of Commerce—over the past 20 years in this country alone.

As I said earlier in my interventions on the Foreign Secretary and the shadow Foreign Secretary, we are running the single market on a deficit that has gone up in the last year alone by as much as £40 billion, so it would be inconceivable for us not to take a rain-check and say, “We cannot just continue with this and pretend that nothing is going on.”

If ever there was a time to tackle the issue in principle, it is now, and that is what the motion is about: whether there is a case for renegotiation or for leaving the European Union. On renegotiation, we must establish the fact in line with the wishes of the people of this country—not because the Whips have said, “You’ve got to do this, that and the other” or, with great respect, because the Prime Minister or the Foreign Secretary have said so, but because we have a sacred trust, as elected Members of this House, to do what is right, in the interests of the British people as we see it for our constituents, and in the national interest. This is exactly that issue tonight.

The Prime Minister has given two speeches over the past year or so—one was about rebuilding trust in politics, and the other was about a European policy that we can believe in. I strongly recommend that people tonight, tomorrow or at some point read those speeches again and ask themselves, “What is going on in this debate today?” We know that the Whips have been strongly at work, but I had all that over Maastricht, we have had it over the years and it becomes something that we have to get used to. The reality is that we are doing the right thing for the right reason. That is the point.

European Union Bill

Debate between Steve Baker and William Cash

Monday 11th July 2011 Commons Chamber

[Mr Cash]

In a sense, this whole group of amendments is a con trick and an illusion. The test to be applied in regard to the number of people who vote in an election is a matter on which I spoke very strongly in the AV referendum debate. As my hon. Friend the Member for Daventry (Chris Heaton-Harris) said, many of the people who tabled amendments on thresholds were not the slightest bit interested in them at that time. There is therefore an inconsistency of principle involved. What they are promoting, and everything that they have been doing over the past 27 years since I have been on the European Scrutiny Committee, during which time I have had the pleasure of watching their perambulations and machinations, is designed to force us further and further down the route towards European integration. They have advised Governments of all hues on the Maastricht treaty, the European Government, the exchange rate mechanism and the Nice and Amsterdam treaties.

I must have tabled the best part of 1,000 amendments against those treaties over the past 27 years, and with great pleasure. I have devoted, I suppose, almost a political lifetime to opposing every single thing that those noble Lords have put forward. I do not need to specify them individually; all I will say is that I regard them as having conducted a process that has led to the destruction of the European Community and, now, the European Union. One has only to look at what is happening today and to ask who is responsible for what has occurred. It has been a concert party—a concert party involving not only the United Kingdom establishment but, worse still, the European establishment alongside the United Kingdom establishment—that has led to the mess that the European Union is in now. As I said to my right hon. Friend the Prime Minister when he came back from the European Council the other day, although we are glad that he felt obliged to deny that we would be involved in the Greek bail-out—having conceded, I am sad to say, that we would be involved in the bail-out of Portugal—he now has the opportunity, as the Prime Minister of this country, to go forward in the national interest and renegotiate the treaties, to get us out of the mess that those noble Lords, individually and collectively, have got us into.

[Steve Baker (Wycombe) (Con)]

We are all grateful to my hon. Friend for his lifelong service on this issue, but on the esoterica of this group of amendments, can he clarify for me that, taken as a whole, they are simply spoiling amendments?

[Mr Cash]

They are, and it is for that reason that I will not be able to vote for them, even though I happen to have some sympathy for the idea of a reasonable test for referendums. However, these amendments are a blind—an attempt to get people to go along with the 40% test for the electorate on the one hand, but also to associate them with a whole range of matters that are entirely inimical to the interests of the United Kingdom. I am not particularly interested in the list that the Government have produced; as I said at the beginning of the proceedings on this Bill, I think that it is a mouse of a Bill. The issue on which we now need to concentrate is the big landscape and the fact that, as the European Council on Foreign Relations paper argued the other day, Maastricht has to be revised. We will have to return to the question of what kind of Europe we want.

This list of proposed matters—which will never come up in this Parliament, as we know—is, therefore, a blind in its own way, but to reduce it to three core issues really makes it an absurdity. I say to my right hon. Friend the Minister that on the big landscape, this is the time for us to take a bigger, more responsible and more statesmanlike view, in the interests of the people of this country, to see the European question as the failure that it is and to get down to the serious business of renegotiating all the treaties and moving to an association of nation states, so that we can work together co-operatively, rather than by co-ordination, to deal with the real, practical problems that this country faces—the Brazils, Indias and Chinas of this world—instead of dancing on the head of a pin, as we are with most of this Bill.

My argument to my right hon. Friend is very simple. He may have the advantage of having come forward with a few proposals that touch at the margins of this issue, but the real question is what is he—or, indeed, the Prime Minister—going to do to get us out of the mess that those treaties have got not only us but the people in Europe into? Indeed, young people aged between 18 and 25 in several countries are now suffering unemployment of 47%. It is absolutely impossible to accept that, and as I said in the 1990s, when this whole system collapses, it would not surprise me to see the rise of the far right and massive unemployment, destabilising the entire European Union, with the most devastating consequences for the international order. That is the problem that we are faced with, and that is why these amendments are not to be accepted.

Lords amendment 3 disagreed to.

Lords amendment 4 agreed to.

Lords amendments 5 to 13 disagreed to.

Clause 18

Status of EU law dependent on continuing statutory basis