The post-budget reaction, after John Healey's debacle this week, is highlighting a number of issues.

The first, and most obvious, is the prevalence of the household budget analogy. Everywhere, commentators say “there is no money”, and politicians are all too willing to agree. But this is simply not true. The UK government creates its own money. It can never be short of it. Using that capacity is wise when the result is beneficial for the economy as a whole, and the risk of inflation is low, as is the case for this reason at present.

I know what the reaction to my saying this will be. We do have inflation, it will be said, and there is a risk that it will rise. That is true, but the inflation in question is not being caused by excess government money creation generating demand that exceeds the economy's capacity to supply goods and services.

Instead, it is being driven by external factors, including oil and gas price shocks, the AI bubble, which is pushing up government borrowing costs as investors sell bonds in favour of speculative share investments, and risks to global supply chains, particularly for food, arising from climate change and the consequences of Trump's war against Iran.

In these circumstances, and I cannot stress this enough, it is entirely possible to create money to meet the very real needs that exist within the UK economy while simultaneously taking action to address inflation caused by external economic shocks. The two issues are not directly related. Conflating them is one of the fundamental problems with current economic policy.

Inflation in the UK is not being caused by excessive payments to old-age pensioners living on less than £13,000 a year.

Nor is it being caused by universal credit payments of under £100 a week to so-called NEETs, young people not in employment, education or training.

Instead, inflation is being driven by external events and the exploitation of market power by large corporations.

That this exploitation is going on is evidenced in company reports this week, with Shell and a whole range of banks reporting substantial increases in profits and distributions to shareholders.

These profits have not arisen from their own efforts. They are the consequence of shortages in oil supply, which energy companies are exploiting through profit gouging or greedflation, and higher interest rates imposed by the Bank of England, which banks are using to generate excess profits.

The consequence is that inflation is being blamed on government spending that meets essential needs, while the real causes, external shocks and corporate profiteering, are being largely ignored and go unaddressed as a result.

And why has this argument been generated? It would seem that the aim is to demand that what the right loves to call welfare spending, and which I call social security, be cut.

This is what that expenditure is on (give or take):

So, the aim of this supposed welfare expenditure is to:

• Support the elderly who have paid National Insurance all their lives.
• Protect those on wages too low to live on, especially when they have children.
• To support those with disabilities and serious illness.
• To support landlords by ensuring they can be paid their excessive rents.

Those demanding cuts in these payments have four things they should make explicit:

1. They should say they want to increase inequality.
2. They should say they think we have insufficient poverty in the UK
3. They should make clear that the vulnerable should suffer more than they already do (and on this, please refer to my pre-Budget video on this issue, and the scale of poverty in this country).
4. They should make clear that greed motivates their every action.

Then they should say why:

• Pensioners should not get the pensions they have paid for.
• The vulnerable should be ignored.
• Children should suffer extreme poverty.

After that, they need to explain what they think the costs of their action would be:

• Those from whom payments would be withdrawn
• To those who support those in need, many of whom are also living in poverty
• To the economy, taking multiplier effects into account.
• Their own well-being, also accounting for multiplier effects.
• Inflation.
• Government credibility, and so democracy in the UK.

What we are actually seeing is ignorance on display in these demands. Ignorance of:

• Economics, and most especially macroeconomics.
• Money, and how it is created.
• The nature and various causes of inflation.
• The lived conditions of others.
• Multiplier effects.
• Ethics.

And all of that makes me very angry, because this deliberate assault from those ignorant of so much has the single goal of making the already difficult lives of vast numbers of people in this country very much harder still. Candidly, I find that very hard to forgive.

And what I always want to ask is, just how did values in the country get so totally fucked up (there is no other appropriate term) that we arrived at the point where it is thought that debate on callous cruelty is something that should be at the forefront of political discussion in this country?

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