Another round: The best of economists on PoliticsJOE

Am I tough enough? Strong and stable leadership. Hell yes, I'm tough enough. Shut the fridge. Not another one! It's the Molotov Show. F*** cast. To what extent do you think that the sort of Thatcher's ghost still haunts actually not just the Conservative Party? I think you could say the Hall of Europe. Yeah. Gone.

Well, look, last year in April, there was a dreadful train accident in Greece, in the early 57, young people died on their way to the university. Why did that happen? Because of the privatization of our railways. What model did they follow? Thatcher's model. And what was Thatcher's model? The first thing she did was

to denounce state corporations as inefficient, as monopolistic, as awful, terrible, you know, British rail, British gas, British electricity. By the way, they work much better than they do today. Or the water board. My goodness. Much better. I mean, Britain was a pretty miserable place when I lived here. But all these corporations worked better than they do today. You only need to take the train to go to Brighton or to go to Manchester to realize it.

presented them as ancient and archaic and arthritic in need of modernization. What was the modernization? You break up a network.

you create one company that owns the tracks, and then other companies that own the rolling stock and so on. I remember what happened immediately after that. Kicks cross. You had the massive railway accident because if you have one company owning the tracks and another owning the rolling stock, it's a little bit like you and me driving a car together, you steering and me having the throttle controls.

and the break controls. We are going to crash. I think we do quite a good job. I understand the analogy. Together we are not going to do it. The chances of an accident are significantly boosted. So, you know, electricity markets. We should never have an electricity market. The notion of an electricity market is a crime against logic because it can never be competitive.

Never. Why? Because in the studio, in your home, there's one electric wire that comes out. And you take that electricity. If you had the possibility of having 50 electric wires, imagine 50 different networks of wiring through the city of London. And you would say, oh, this is cheaper. They'll take that one. Then maybe you would have a market. But with electricity, you can't. So there's one wire coming out. And the government has to simulate the market.

which takes the form of some kind of auction house when different private companies that produce or carry electricity or sell electricity supposedly compete with. They don't compete. It's a cartel. Blackopic. They cooperate fully in order to skin you.

So, how did we get electricity markets across Europe now? I mean, the reason why we have this massive cost of living crisis, part of it, is because we have electricity markets. If you look at their profit rates, in Britain, in Germany, in Greece, in Austria, in Italy, during this crisis after the war in Ukraine in particular, right, their profits are going up. Why should their profits be going up? The answer cannot be that

natural gas has become more expensive. That's a cost. I understand price going up in sync with the cost. But when they tell me, and they celebrate this in the stock exchange, that profit rates are going up, it means that price are going up faster than the costs by definition, which means they are a cartel.

That's why competition doesn't work. Where does this disaster come from? Margaret Thatcher. But wasn't she brilliant in the way that she managed to wipe the floor clean with a Labour Party, with a Labour Party, with her own wets, and push all this in. And not only push this in, but cause an infection.

in the European Union because every cynical and oligarchic policy introduced in this country is now in Greece, in Italy and Portugal. The opportunities our parents had are not available for us.

And if we think about what has become so expensive, it's not just house buying, it's also renting, it's not just education, it's also childcare. And one may say that the main entry points to adulthood have become unobtainable for our generation. Which generation

becoming known as kiddolds, right? We're stunted in our growth, we're failing to launch, we're not doing the traditional pathway into adult concept of the kiddolds. Yeah, so it's something that I talk about in the book, it's that idea of we are not sort of

taking the traditional pathway into adulthood that our parents did. And that's sort of five markets of adulthood, if you like. There's finishing your education, there's leaving home, there's getting married, having a kid and being financially independent of your parents.

And on all five of those markers, we either delayed them or frankly rejected them. So, fewer of us are getting married, fewer of us are having children, you know, we're extending our education, we're extending our stay with our parents and we're financially dependent on them more and more. And so, I sort of talk about this concept of kid-old-hood because it's that idea of we're not quite adults because

economically, we're struggling to do those traditional adulting things. But we're not quite, we're not, you know, kids. So it's this point in our lives between, I sort of name it, sort of frame it around 18 to 35, where there is a culture of dependency on our parents if we have it. And if we don't have it, we're also unable to launch into adulthood as well. And that's, you know, I trace the story back to the 80s because that's when our parents' story started.

that's when they were able to amass such wealth, particularly in property. They had conditions that we don't have. Good pensions, good wages, access to property. They've built an incredible amount of wealth. One in five baby boomers is a millionaire in this country. But the point is, is that the real story of the inheritocracy starts in 2008.

because it's when wages stall, it's when house buying and renting goes up. It's when the kind of chief markers of adulthood become ever more expensive. And the market becomes dysfunctional, as we know, in the aftermath of the 2008 financial crisis, particularly around housing.

the state retracts, you know, so the state isn't there to help. So who steps up and who steps in to help those, you know, their loved ones, it's the parents. And so the Bank of Mom and Dad, even as a phrase, kind of comes into the sort of public domain around 2014. And really it's something that we've used as a sort of shorthand to describe the dependency culture that we now

a lot of us have on our parents in a way that we don't rely on the state or the market. And that's a dysfunctional economy, right? It's creating a dependency culture that's preventing people from relying on their wages. It's preventing people from getting on the housing ladder. It's in many cases preventing people from having more than one child or any children. And so it's actually a really dangerous economic force. But it's also one built on love rather than cold, hard capitalism.

I've got a video on my channel called How the Rich Gorit from COVID-19. It's the first video on the channel, which explains this massive government deficit will end up with the rich. We can go through that if you want, but it's on that video, so people can see. If the US government gave up $10 trillion, that's $80,000 per taxpayer. You need to fucking know who's gonna get that. And the most amazing thing is not that it happened, but that nobody asked the question, who is the guy who's gonna get massively, massively rich here? And we can only have that situation

when economists have been almost brainwashed to never think about distribution. And I think this is, you know, the reason I'm a multi-millionaire really comes down to one simple fact. I understand that wealth distribution matters. And that's why I'm fucking right year after fucking year. That's why I was fucking top trader in the world, 2011. That's why you can go and read my articles and watch my videos from 2020 saying there's going to be a fucking cost of living crisis and inflation crisis because I understand that distribution fucking matters. And this is, you know,

I honestly think that I don't think I'm going to fucking change the world one person, but ideas are powerful, right? If enough people in this country understand that the reason that their fucking kids can't get houses, in many cases, can't have families, a struggle to feed their kids is because of growing inequality, they will fucking stop having it. But people need to understand, I think not enough people connect. People don't realise the reason they're poor is because of growing inequality. We've kind of got this

almost brainwashed idea that you can't think like that, that zero sum, that's fucking politics of envy. Listen, I'm not fucking, I'm not fucking Mahatma Gandhi, I'm not here to talk about morality, okay? I was the best fucking trader in the fucking world, and I'm the guy that calls it right, every fucking year, okay? If you do not fix inequality, your fucking kids' lives will be shit, and it can get much worse than this, right? Go look at what average living standards are like in really unequal countries.

Go to Mumbai, go to Sao Paulo, go to Johannesburg, you know. And if you think that can't happen in this country, you know, read fucking Charles Dickens, you know what I mean? It can happen here, it will happen here, you know. You need to protect your wealth distribution. If you move to a super elite country, then life will be shit. Finally one country that's super unequal where life is not shit for ordinary people. The problem facing Britain is that we are and have been for 40 years too unequal.

with the most unequal, large economy in Europe. And then for the last 15 years we've been stagnant. Low growth, no wage growth. And I know it's popular to say, I'm a degrother. We don't want the economy to grow. Who needs that? It doesn't help ordinary people, but that is garbage. We do need the economy to grow. And the fact that we haven't been growing is why when the energy crisis hits, we end up with food bank queues going through the roof. So the diagnosis is those two things are going on. And if you put those two things together, the higher quality and the low growth, then it is a disaster for

lower income households. That's why our poor households are a quarter poorer than their French and German equivalents. That's 4,000 pounds a year. That's why you can't afford a 1,000 pound rise in an energy bill. So that's the problem statement with some extra stuff on how that plays out across generations where in general younger generations have borne the brunt. I don't want to say all of that because older generations in the book goes into this in quite some detail, like who's living with those 7.5 million people sitting on NHS waiting lists? Okay, all ages, but disproportionately,

older generations because I've got some bad news which is we break more as we get older and so it is older generations that lose out most when we stuff public services. So that's the problem statement and obviously growing the economy is how we make sure we can fund those public services in the future. Then on the approach the book

Hopefully, without annoying too many people, suggests that we're not serious about turning that round. We're not serious in a number of different ways. We're not serious, partly because lots of the ways people think about Britain and talk about it and do their politics. I'm not sure they even like Britain very much. So a lot of the culture war, the problem with Britain isn't that our wages aren't growing. It's that apparently half the country's living in ethnically divided ghettos, which is what's a will of brothermen.

uh, likes to say it's just not true. So the book goes through the facts and says, look, that isn't true. It also says, if that's your politics, you're going to lose. And the reason you're going to lose is because the country isn't actually divided on those things except for some minor issues. But on the big stuff, you know, if you look at polls out over the last few weeks on, you know, where's the country got better or worse over time?

I've got some bad news, most of it's worse. And it's definitely worse on all the economic bread and butter stuff, which is what I'm actually about. In the end, you want politics of jobs and houses, that's what matters. But where's the country got better? Gay rights. When I was a kid at school and I go into this a bit, people weren't walking around holding hands if they were of the same sex. In fact, I don't think anyone was actually out at my school, and that's because there was a lot of prejudice around. And on those things, things have changed way faster.

So there's things to be optimistic about and if you think your politics is about fighting against those things, you're going to lose. Then one big answer, there's one thing people take away hopefully from the book and there's quite a lot of pages. Hopefully they can manage more than one and I've got total faith in the British public to get more than one.

then it's that we can't carry on being a country that just lives off our past. We are going to have to invest in our future. And you can see that all over the place. I mentioned the potholes as a symbol of our decline, but you know, water, right? So we all, you know, if you, anyone who reads them, guards, you know, actually, most of the papers these days will be used to being told, you know, lots of our rivers are polluted.

It's hard to swim in them and I've had personal experience of that, swimming in some unpleasant Kent water leading to significant bowel problems, which I won't go into any more detail. Thank you. I want to protect you and your... That's bad. Yeah. But it is bad. But I'll give you another fact that has stood out for me and starts one of the chapters in the book, which is, if you look at British reservoirs, we used to build reservoirs, several reservoirs a year, sometimes running basically from 1850.

right the way through to 1990. And that included in the wars. We opened reservoirs, including huge ones like Lady Bower and Derbyshire. We opened it during the Second World War, right? We could manage that. Since 1990, we have not built one large reservoir in this country. What's happened to the population since 1990? It's gone up by 10 million people. And we have not managed to build one. And that's just one simple. You see the same thing if we look at the energy system. Like, why are we struggling so much to make sure we can build out this renewable energy that we need and to connect it to the grid?

because we've not been investing in the grid.

for decades because we told ourselves, oh, no, no, we're really clever. We're just going to live off the past investment. We'll sweat those assets, which made sense if you own some of those assets. But we don't need to invest. And now we're in a big hole. And the same applies to British firms. If you look at British firms, if they invest, actually, they make bigger profits, bigger returns on those investments than you see in France, Germany, and the US, which I learned in people would think, people think, oh, Britain's stuffed. If you invest money, you don't make it back. It's not true. You get higher returns in the last decade if you invested in Britain. What's the problem?

no British firms actually do any investing. So that's what we've got to sort out. Public investment, private investment, regulated utilities, investment. And if you don't do that, well, then you're kissing a future goodbye. You write in the book, you say that Brexit devalued the economy. Can you explain what you meant by that?

Well, I mean, I was really referring to the exchange rate having foreign. But I mean, that's a sort of metaphor, really. But the fore in the exchange rate made us all poorer. That's without any doubt. But clearly, the impact of Brexit is quite profound. I mean, in a sense, foreign exchange markets.

were saying you have devalued the economy and contributing to poor living standards by making things more expensive because that's what happens when you have a weak currency. But they were anticipating the effects of Brexit and they got it right.

And I mean, when I wrote that, you know, sort of concluding it earlier this year, you know, the palm was still below where it had stood on the evil of the referendum vote, you know, against both the euro and the palm and the dollar. And that makes the case. Was that case inevitable?

If we, let's say we went through the, I don't know, the politicians in charge were different. The way we negotiate our exit was different. Any of those various factors. We always end up in this situation where, as you say, Brexit would devalue the economy. Is there a world in which it could have benefited our economy?

No, I don't think so. As Mark Carney said, it's a sort of unusual thing. It's a deliberate act of de-globalisation. It still amazes me that this decision could be taken

in such a frivolous way in my opinion. I think that it's obvious that there should have been a much, there should have been breaks on this process that we shouldn't put a policy which had been a desired since the early 1960s and achieved in the early 1970s

to a vote of referendum that will decide it according to potentially just one vote. I mean, it's completely ludicrous. With no safeguards, I mean, none of the safeguards, for example, occurred in some previous vote's referendums in this country.

So I think it was an act of complete folly and it's absolutely extraordinary the lack of understanding of your own economic history because if you go back to the 1970s there was a debate about why didn't we join

the whole project in the 1950s, and all the losses that ran on from that, because we weren't able to shape the emerging communities, eventually EU. And all that was neglected. And we learned through bitter experience, then, that you were much less influential outside than inside the European project. To focus on the city of London,

and those banks for a moment then. You've previously described the city as London as a drag on the UK economy. A lot of people, and for the reasons also that you've just outlined, it can be a ginormous risk, a millstone around the neck and albatross, whatever you want to call it.

I don't necessarily think this, but I will argue the counter view right, which is that the city of London essentially drives the exchequer. You know, it's something like 10% of the tax take in Britain's and that yes, whilst it might be risky, this financialisation can pose risks to our economy and it can jeopardise all sorts of things, potentially even topple government. Nonetheless, all of that money, some of that money that gets made there, taxes are collected on it. And as a result, it might not be

a part of the economy we necessarily desire, but it is, unfortunately, one which we now necessarily need in order to fund the exchequer.

Remember Cuba before Castro? I don't, but I'm aware of it. Not why, but I remember the theory of it, or the imagery of it. Well, its economy was based on the mafia. You could even say that, you know, 50% of the Cuban economy before Castro was the mafia. That's not a good reason for keeping the mafia. This is exactly what's in the city of London. Now, why is the city of London?

So such a significant chunk of British GDP, because Margaret Thatcher destroyed British industry. So if you destroy the factories, if you close them all down and you leave the city of London, right, and you keep giving the city of London public assets to play with, and though it gets bigger, of course it's going to become a significant percentage of, you know, portion of the British economy. So, you know, it's like a mafia.

which is destroying the fiber of the Britain's social economy, it is parasitic on it, and it grows more and more. That is an argument for treating it like a cancer that needs chemotherapy to be excised or irradiation or surgery or something. It's not an argument to keep feeding it. Because I cut my teeth as an economist, as a student,

just when Thatcher came in, in this country. I am old enough to remember how it all worked. Why did the city become so significant? Okay. Before Thatcher, it was because the city had created a way of bypassing all the rules and regulations of the Bretton Wu system. Essentially, it was a little mafia in the making that allowed bankers to violate the rules of their own governments, not just in Britain, in the United States, in Germany, in France,

through various jurisdictions in the Cayman Islands and so on and so on. But then Thatcher comes in and boosts the city of London. That's why they loved her so much. First thing she did was to sell off council houses. Now, why was this significant for the city of London? Well, because to begin with, it essentially told working-class people

Here's a house, the one you're living in, which you do not own. It belongs to the local council. In the market, if this were to be sold off as a private home, it would fetch 30,000 quid, right? We'll say it to you for 10. Essentially, we are giving you 20,000. Now, of course, you don't have 10. So go to the bankers to get it, right? That's first number. That's financialization's commencement in this country.

You appropriate the working class because suddenly they love you because you give them 20,000. They don't understand that your kids will not have anywhere to live because once that house gets solved and all house prices go up, the next generation of working class, Britons will have nowhere to live as is the case today. And the next thing he did was to say, OK, I'll give you something more.

to the British working class, you know, to the blue-red wall and so on. What I'm going to give you is an opportunity to make some money from privatization of British gas, British Airways, and so on and so forth. I remember the amazing campaign by Sanchi in Sanchi to sell off British gas, Tal Sid was the big advertisement. Sid, of course, was a working arts person. And what the message to Sid was, is this, look, we are going to

take British gas, we're going to chop up its value in little bits called shares. And we will, because we are Democrats and we want to push for a share owners' democracy, we're going to limit the amount of shares that anyone can buy. So we're not going to give British gas to some conglomerates. We're going to give it to usage. So can you raise 2,000 pounds?

because if you do then we will give you a share of a portion of British gas.

they made sure that the shares were undervalued, just like the council houses were undervalued. So it was standard and poor, and Esten Young, and Price Waterhouse, and they told them to look, the real value of this bunch of shares is probably around 4,000, we'll sell them for two. So what CID does is goes through Lloyd's bank, the Barclays bank, and what they do is they take a loan. 2,000.

because they know that the next morning they can sell for four thousand. So the banker gives the money to them.

essentially without asking for any collateral for anything, they know that they will be able to take it and they detect their money back. But suddenly you had a massive boost of share sales and the co-opting of a large chunk of British society into the stock exchange. Of course after that they were jettisoned because then the shocks come along and buy all the shares and suddenly British gas belongs to a conglomerate within a week. This is financialization. So it takes politics,

And it takes cynicism on behalf of parliaments that allow this to happen and legislate so that while industry is being depleted and shut down, the wealth of the nation is bestowed upon the city of London. And then the city of London says, you can't touch me. I am the center of this nation's wealth. It's kind of like a mafia. It is a mafia. It's exactly like the mafia in Cuba before customs.

Shut the fridge. It's the one that's a joke. First of all, it's really important to classify this not a 1% issue. It's not just the 1% that have the Bank of Mum and Dad. It's not just the 10% that have the Bank of Mum and Dad. The Bank of Mum and Dad doesn't just come in the form of a house deposit. It can come in form of childcare support, for example, in terms of time. It can come in terms of staying with your Mum and Dad while you save for a deposit. And it's not just a London problem either.

distinctly sort of literally toward the country, interviewing different people from across the UK. It's sort of really doing a deep dive as to the regional levels of dependency on the Bank of Mum and Dad. And it's very clear that over 80% of millennials expect to get some kind of inheritance. At 80%. Now, that's reflected the fact that there's so much wealth in that older demographic. So there's about 5.5 trillion amount in housing.

trillion pounds in housing, and quite a substantial amount in pensions. Now the lucky ones, the really fortunate ones, are the ones that get their inheritance early, that get a lump sum to buy a house, right? And get it when they're ready as well, okay? So they're the lucky few, and then the really lucky ones are the ones that marry someone who also has a bank of mum and dad, because then you're talking about the merging of two banks of mum and dad.

The really unfortunate are the ones that have no parental support, obviously whatsoever, who have no access to that safety net, let alone an early inheritance. But there's also those that are really unfortunate as well who don't get their inheritance early and will

have to wait for it until their parents pass away. And that comes with great uncertainty, of course, because the conversation we don't have as a country is around social care. And the reason why I talk about social care in the book and looking after our parents is because if we've had 30 years of our parents looking after us,

and frankly supporting us. We've now got 30 years quite often because we're living longer with illnesses and dying is now actually a much more complex thing in the 21st century than it was in the 19th. We've now got to look after them and that puts our inheritance

crudely speaking, at risk. And we have this funding gap in the social care system, as we know. But we also have a lot of money in property. And so I would say there is an unspoken sort of assumption that the baby boomers will have to pay for their own social care, mostly through their property wealth. The support system from the state

funding for social care isn't there. Families won't be able to pay for it themselves. It's going to come from the release of property. So the really unfortunate, the ones that are waiting for an inheritance, expecting an inheritance, but it will be gobbled up by the social care bill of their parents. So I wanted to sort of map out this in heritocracy because although it's often in reference to housing,

And perhaps education, because education has become more and more expensive, actually also kind of fits in with social care as well. And that's a young people's problem. People talk about social care like it's an older people's problem. It's not in the way in which whether we pay for it through our families or through the tax system, we're going to have to foot that bill. And so I wanted to kind of tease out this sort of economics of that.

and talk to people who have lost the family home or who have sacrificed their inheritance or who have even sacrificed their own wealth to pay for social care, to pay for nursing home or home care for their elderly parents with long-term illnesses. Tell me more about this idea of the rich sort of squeezing, sucking the life out of the middle class, this sort of redistribution of, well, assets, I guess, from the shrinking middle upwards.

first thing we probably have to discuss a little bit who the rich are right because you know when I was a kid I come from like very modest background and when I was a kid I thought rich was like anyone earning 60 grand a year that's why you know I don't know what your childhood was like but that's what I thought right 60 grand a year to me was like loads of money um that's not the rich that is not the rich um you know there are families out there that have net wealth of like hundred million quid

they run in family offices. And I think it's worth understanding, right? Imagine you are. So Richard said, like, according to Times, Richard, this is where 700 million quit, right? He'll make 5% a year on that, you know? Let's be conservative, say he makes 3% a year. That means he's making 21 million pound a year. Passive income. Passive income. What would you do if you made had 21 million pound a year passive income? Quit my job. How much money would you spend every year?

I don't think I'd spend all of it, right? I think I would, I'd just, I'd take whatever an index fund delivered off it, and that'd be me. Exactly, right? I mean, if you spend a million pounds a year living, I couldn't spend a pocket, I don't know how you would do it, right? So, you're a return act, you spend a million pounds a year, and that 20 million pound, you use that to buy assets, right?

And, you know, if it's a growing, if you're in a rapidly growing economy, they can use that to build new assets, but we are not in a rapidly growing economy. So what happens if your economy is not growing, and this guy is getting 20 million pounds in assets every year? Well, it has to fucking come from somewhere. You know, so...

If, you know, I always think people need to look at their family, you know, and like, what percentage of your home did your dad own when he was your age? It's going down, right? It's going down. And if you look at like the per se, youth home ownership is collapsing, right? Those houses are not fucking disappearing. Look at government debt, it's going through the roof. Look at mortgage debt, it's going through the roof. Somebody's on the other side of that debt. You know, I think we, you know, Tony Blair famously said, you know, I don't mind if the rich get rich, right? If the rich, wealth of the rich is exploding. At the same time that wealth of the middle class is collapsing and wealth of governments is collapsing.

Do you not think these two things are fucking connected? You know, it's... And it will only keep going, right? It will only... You know, passive income, it's not just... These guys are not Gandalf. They don't just magic wealth up, you know what I mean? If they are getting richer, and the middle class is getting poorer, and then it compounds, right? Because then, fewer middle class people... When I say middle class, I mean people in the middle. I know people use this term for different things. Your average family...

20, 30, 40 years ago, your average family owned the fucking house and now they're fucking done. Where did those fucking houses go? And you know, you've got the size of mortgages. Where is that debt to you? And then that means you pay more interest because you've got bigger mortgage. You pay more rent because you buy a house later. That mortgage goes to the rich. That rent goes to the rich. Then they have a bigger cash flow which they use to buy the houses that your kids fucking need. You know, this is a spiral and this gets worse and worse. You know, what's this quote? This attribute to Albert Einstein compound interest is the greatest force in the universe, you know?

So those are both matter. You know, the middle class is losing its wealth. The amount of homeownership there, especially once you account for mortgage, is collapsing. The government is fucking bankrupt, basically. And this is not just the UK, by the way. This is across the Western world. You know, these two things are not connected. Government is losing wealth, middle class is losing wealth. When I say middle class, all the living families are losing their homes.

And the rich are accumulating the rest of this shit. If you are asset poor in Britain, it has become more difficult. And if you were already asset rich, well, then there have been some upsides recently. And that isn't about young versus old. It's just about who is Britain happened to have done better for over recent years. And policymakers need that in their head. I can give you a concrete example. In the 1990s, if you ask people that were concerned like me with what was going with poverty, they would have said, look, there's two big problems.

There's pensioner poverty, 40% of pensioners were in poverty in the 1990s, and there's child poverty. About 30, 35% of children were in poverty in the 1990s. If you look at what people who are doing my kind of work in those times, that's what we would have said. That is, they would have said, government needs to focus on these two problems. We've got to bring these two things down. We can't have pensioners dying because they're not turning off their heating, and we can't have children growing up in poverty.

wind forward, 30 years, pendulum poverty is basically halved over that time period, which is great. Which is really important. It's not just about assets, but a lot of it is to do with assets, but it's also to do with

Private pensions are bigger, more pensioners are working later. And it's great that we have longer lives. I care about living standards. I talk about those in pounds and pence terms, but like definitely a longer life as a generally. 100%. That's definitely living standards. We'd all like that. It's literally living. So there's good news there, but child poverty is not budged basically at all. Came down a bit in the 2000s, comes down a bit during the financial crisis, then it basically rises slowly back to where it started. So we've made basically zero.

Progress one in five children in Swansea are growing up in poverty today. So that is not what we are aiming to

aiming to achieve. So our policy makers, it's not about saying, right, well, we're anti the old people who are no longer in poverty. It's about saying what we're doing about, you know, how have we prioritised and is our prioritisation of issues based on the evidence, rather than based on something else? And the evidence would say when it comes to the economics, we do need to worry particularly about younger generations and we can see that on assets, which basically means homeownership and pensions, the other assets. I mean, cars are important, but we basically mean homeownership.

and pensions that's what we should focus on and when it comes to older people then you know our public service collapsing is terrible I mean we did a poll for this book on do you think Britain's doing great and I think well you'd probably be surprised by this older people were more likely to think it wasn't going great than younger people

quite a bit. Now, everyone thinks it's going totally, right? Young, old, Tory voter, Labour voter, rich and poor. Everyone thinks things are going bad. Nobody thinks Britain is going great. Gangbusters, I think, are going to be crazy. The economy is not going gangbusters because anyone who's lived in it and got paid a wage or gone shopping would have noticed that over the reason. So it's not going great. But if you then ask them,

What do they want done about it and maybe we can come back to this a bit, but like, you know, public services is the top thing. I think you need to diagnose what is wrong with the economy. I mean, why has it done so badly? Why has the deterioration in our performance been worse than any other GE7 economy? Which in to a certain extent reflects that we were doing rather better than usual in the period before then.

And so, I mean, there's massive debate about all this. And, you know, the sort of masses of ink has been spelled sort of writing about the productivity possible, why do you suddenly slow down. But I think at the root of it is a lack of investment, a lack of physical investment in infrastructure. We see this around the economy.

you know, the state of our water, you know, on a public side, the state of hospitals, and also, you know, very lackluster business investment. And so we're not, and that's on the physical capital, you know, kit, buildings. But then you have people. And I mean, it's clear that we just have such a big problem

in a lot of skills, you know, we're lacking, we let down people who aren't necessarily going to go to university, or are going to do more, want to do more vocationally-oriented courses. And, you know, we have a real skill shortage. And a lot of these things have been diagnosed for ages, but we don't get around fixing them.

So it's, I mean, in fact, you know, Starmer talks about fixing the foundations, but I don't think that fixing the foundations in the first year and then everything. I mean, I think fixing the foundations could be the work of a whole term, really. It's not longer. Yeah, well, hopefully, you gradually turn things around. I mean, you know, the thing with infrastructure spending

is that what you want to do is not to sort of aim for some, you know, some one year, two years of high spending money. You want to have a consistent stream of infrastructure projects going through and then the construction industry can plan for that.

and can invest itself in the skills it needs and the people it needs. So we want to be more like the tortoise than the hair. The hair will always sort of run out of steam. We've got to be more like a tortoise. It's a fault of the Labour Party in this country. It's a fault of the centre left across Europe. It's a fault of the Democrats in the United States. When you have

a social democratic party, whether it's the Espedin, Germany, or the liberal party here, which trades in a vision of just society. And when they come to power, they turbocharge every oligarchic policy that they've inherited from the Tories.

This causes two social phenomena. One is people become a pathetic and stay at home and they don't want to know about politics or they become fascists. Not fascist in the sense of Mussolini's uniforms and so on.

But they become xenophobic, they become cynical. They start believing that Brexit is going to allow them to take back on control, and all that allowed was Mr. Johnson to become prime minister. It is the fault of the left. And I believe in myself on this. It is our fault. We must blame no one, except ourselves. Think of the United States in 2008.

You know, Barack Obama was elected with a mandate to get rid of the ballistic bankers and bail out the banks because you can't let them fail people's savings are in there, but we will get rid of the bankers. That was the cry call, which is what FDR, you know, Roosevelt had actually done in 1933. Roosevelt had liquidated the bankers, not the banks, the bankers. And that's why the bankers really hated him.

What does Obama do? He takes two gentlemen, Tim Guidness and Larry Summers, who were a Clinton's duo in the finance ministry in the US Treasury Department. The two men who had worked for Wall Street to unshackle the bankers and to let them go crazy to the extent that it brought about the 2008 financial collapse. He takes these two men and gives them a mandate, save the bankers.

and they bring together $12 trillion American dollars to save the bankers. Do you know where the result of this is? This is the rhetorical question. Donald Trump.

I mean, it's natural. I understand the blue-collar workers that Hillary Clinton deplorably called the deplorables. When they say, look, we tried you. The idea that Trump was elected on the wave of racism, that's rubbish. Black people who voted for Barack Obama in 2012. 2008 and 2012 as well. They voted for Trump.

You know, that's why he got elected. There aren't enough racists and fascists in the United States to elect the president, even with a stupid electoral college system that they have. So the simplest way to understand this is, if you give a thousand pounds to an average man or woman on the street,

They all spend that, quite possibly that year, but almost definitely within the course of their lifetime. Most average people die with very little accumulating wealth, which means they spend everything they make, you know. My grandparents all owned their property and they died with basically nothing, you know. Ordinary people spend the fucking money they make in their lives. If you give a thousand pounds to, you know, somebody worth 700 million quid, they won't even fucking notice. It goes into the investment account and accumulates. Which means is buying assets. So what that means is,

Poor people buy goods and services. All of the new people buy goods and services, rich people buy assets. So in a mass market economy, what you have is goods and services are expensive because people want them, which sounds bad. But what's your job? You provide goods and services. So that's good because you can get a good wage, because you can sell stuff that'll worth money, right? In an expensive economy, what is worth money? It's worth the rich one. And what did the rich one assets?

So you go and look at, I think a lot of people in this country, they look at these historical graphs of house prices as a multiple of earnings, and they say, this is fucking unsustainable, mate. Go and look at what it's like in really unequal places. Go to Hong Kong and see, go to Sao Paulo and see what the average wage buys you in terms of housing.

You know, go back and look, you know, read your Charles Dickens, you know, look at what the average person got for housing back then. You know, really unequal places have never provided good quality affordable housing because at the end of the day, you are competing with very rich people to own those properties.

and what the rich people want. I've got nothing against rich people. I am a rich person, right? Rich people buy assets and they hold assets and they accumulate assets and they naturally empire build, you know, because the money grows itself because of compounding interest, right? Yeah, you know, you are in a competition with rich people but assets. If they are really, really, really, really rich, then you can't, I think COVID shows that better than anything. You know, COVID was a massive accumulation of cash by rich people.

People are predicting house price collapse. If you give rich people 800 billion quid, house prices will go up. I don't think we've seen anything like that after that. I think house prices will go absolutely mentally the next year. Because the rich still have that money. They have a lot of money. They need to use that to buy houses directly or to mortgage lending, which indirectly pushes house prices up. Rich people buy assets. If you give all the money to the rich, asset prices will go up.