Fishing for votes
[RE: A wealth tax won’t work – except as political pantomime, Thursday]
Nick Clegg’s suggestion is bad politics and a sly way to fish for votes. It lacks moral merit and foresight to tackle the deep-rooted problems facing the UK economy. Wealth creators already suffer crippling taxation in the UK. Clegg’s battle should be against inefficiencies and ineffective government, not closing the shutters on wealth creators. The people, not the state, would lose and many welfare-dependent people would be punished by further benefit cuts as public debt sores even further, pushing the UK further into economic uncertainty.
[RE: Is America’s Republican Party right to be considering a return to the gold standard?, Thursday]
If you are concerned that a fiat currency, printed at will by authorities, is only an expedient way to fund governments, then you will understandably long for the gold standard. However, the banking system would still run liquidity risks (as in fiat money systems). But it could be made worse by fluctuations in the gold price, potentially resulting in random, violent bouts of inflation and deflation. And worse, it would mean that central banks would be unable to act as a lender of last resort to stem a potential collapse.