Pharaoh dreamed: and, behold, he stood by the river. And, behold, there came up out of the river seven well favoured kine and fatfleshed; and they fed in a meadow. And, behold, seven other kine came up after them out of the river, ill favoured and leanfleshed; and stood by the other kine upon the brink of the river. And the ill favoured and leanfleshed kine did eat up the seven well favoured and fat kine.

This is as political as this site seeks to be: 3000 years old!

But the point is surely well made: Joseph interpreted the dream rightly: when there are years of plenty reserves should be built up: so that when “famine” years come there  is money in the kitty to allow for such.

Nearly all politicians will do all they can to avoid building up reserves: rather they allow the popularization to gorge themselves in the belief that “tomorrow never comes”

Seemingly a belief too of many economists.

The Centre of Ethical Economics, together with the editor of “thismillennium.com”  is trying to create a book on this subject. Help, please!

It appears to be widely accepted that the price of all buildings - and in particular private homes - has been the breaking point setting off the present crisis. This has very simple origins: irresponsible governments and banks who have for popularity and financial reasons let house prices increase much more than the rest of inflation. Offices, shops and factories were allowed to become overpriced to help pension funds to succeed in the short term. House price increases was very popular with those who owned houses: their wealth increased without any action being required on their part.

One set of “experts” blame “low interest rates” which made houses “too affordable”. This is immoral. The reason is that governments felt that it would have been unpopular to not allow house pricing to run ahead of inflation by not taking preventative action (for example by putting high capital gains tax on excessive house sale gains).

Banks gave firm financial encouragement for their staff to lend high amounts without any thought that this might be in the long (or as it happens) medium term bad not only for their customers but also for the banks themselves. We know that in the UK, for example, for many bank branch managers the sale of mortgages at almost whatever cost to customers was considered more important than using prudent banking practices.

All that was needed was simple ethical thought, a study of the past, and a little common sense.

(see further “Housing“)

For years now this site has been warning of the effects of high house-price inflation. We had thought the crash would be in the 2010s rather than the 2000s. But come it has. Further discussion is on the site.

But the resultant depression is causing many un-necessary effects.

Are there lessons to be learnt: and if so will they be accepted by those for whom a revolution to their accepted thinking is required?

This is where we generally get involved.

To put it at its simplest: if, to stop economic “overheating”, governments had increased income tax - made the better-off contribute their share of the medicine - AND put surplus funds thus obtained into reserves: then adequate money would now be available to help in the times - the inevitable times - of depression.

It would appear that the only reason against this is the really rather immoral way in which political parties and politicians state that for none-too-ethical reasons that income tax should always be kept at minimum levels. And perhaps the cynical attitude of those who think that taxation is anti-work, anti-personal freedom and surpluses will never be held.

But we are not politicians. We merely hope that some of them will be brave enough to get out of old, stale, rather immoral and economically rather dubious thinking.

More work on this will follow in 2009. But there are further thoughts on this subject within the site.

“God grant me the serenity to accept the things I cannot change, the courage to change the things I can and the wisdom to know the difference” (Courtesy World Emergency Relief)

The pessimist is one who thinks that the human being in inherently incapable of being other than greedy. The optimist “knows” we can change.

This site is the challenge for the optimist to succeed.