The bishop teaches economics
If only people would stop spending
The Bishop of Gozo has taken to his pulpit once more with some well meant but misguided advice, telling people not to spend money and to prepare for the worst, so that jobs would be safeguarded.
Oh dear. The Curia has a lot of money and no doubt it also has financial consultants. Perhaps one of them could take the bishop aside and gently explain to him that it is precisely when people stop spending that crisis ensues.
If the bishop wants to do this country a good turn and help alleviate disaster, he should be telling us to carry on spending, to carry on eating out in restaurants, to go right on drinking in bars and buying new cars so that we can queue up behind Joseph Muscat and demand our VAT back, which we can then use to buy a nice outfit for the upcoming spate of 1,000-guest weddings.
Imagine what would happen if we were to follow the bishop’s advice. Hundreds of businesses would go bust within months, leaving thousands unemployed. The only way to keep businesses ticking over and people in employment is to spend, spend and spend some more.
If you’re thinking of pulling in your horns and tightening those purse-strings, just stop and think. That’s the quickest way to bring about the very result you’re trying to avoid.
Your income depends on other people spending money, and other people’s income depends on you spending money.
While it’s a natural reaction to conserve your resources when you’re frightened and unsure, there’s a word to describe what happens when large numbers of people start doing the same thing as you are: recession.
You stop spending because you want to, not because you have to, and before you know it, others have had to stop spending because they’ve lost their job and they have no money. And the dark downward spiral continues.
This is excerpted from my column in The Malta Independent on Sunday today.
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Exactly what I was thinking, if people don’t spend, prices go down which means that companies would either need to sell at a cost for a period of time (weathering the storm) or liquidate their assets.
What is it with the Catholic Church and their bogus advice lately?
First the Pope told Africans not to use condoms and now The Bishop of Gozo tells us Don’t spend during an economic recession.
As much as the Clergy would like to believe that God is everything. Theology isn’t the study of everything.
The Times reports that “In view of the economic crisis, people need to spend money in moderation, according to Gozo Bishop Mario Grech.” This is a different matter altogether to “telling people not to spend money.” I believe his message was to avoid overspending (and living beyond one’s means) and to prepare for a rainy day. I am sure you are not advocating that people should spend, spend, spend, regardless of their means.
[Daphne – What the bishop should have warned against is credit, not spending. That’s a different matter altogether. The fact remains that relatively few people’s jobs are at risk. If your income is not at risk, giving in to the fear factor and spending less than you would normally is pretty senseless and creates problems for others. It is an exercise in selfishness not selflessness.]
Jesus Christ’s advice was to give to Caesar what is Caesar’s and God what is God’s. Caesar, being the government, at this time wants you to go out and spend to keep the economy ticking over. Some governments even provide a stimulus package whereby they provide their people with a sum of money to go out and spend it, not hoard it.
History thought us that by doing the opposite to spending during a recession makes matters much worse. Does the Church in Gozo want to see a return to the economic depression of the 1920’s? That is exactly what happened then.
The suicide rate among business people went haywire and the poor starved because they had nothing to feed themselves with.
Let the governments of the day take care of the bread and butter issues and church leaders provide the sustenance for the soul.
The bishop should set an example by stopping the collection of money during mass and advising people to save the pennies for a rainy day, and then they could buy a loaf of bread if hard times hit. U ajma jahasra!
You are right, Daphne. In this world of topsy-turvy economics, capital is not about savings, but about accumulated debts, and spending can only further increase those debts. So when bubbles burst, they just create more money and everyone will merrily pay the inflation tax unknowingly. The bankers just love receiving interest on non-existent capital, and the bankers’ bankers are having the best of laughs. First they create the problem, then they’re the first to come to our rescue. Now they want world economic governance and the Daphnes of this world just love it.
Read Keynes before he became the bankers’ economist and you’ll know what’s in the magicians’ bag. Here’s what Keynes wrote in 1920 (before riding the banksters’ bandwagon):
“There is no subtler, no surer means of overturning the existing basis of society than to debauch the currency. The process engages all the hidden forces of economic law on the side of destruction, and does it in a manner which not one man in a million is able to diagnose.”
And here’s what Bill Clinton’s hero, the influential Carroll Quigley, had to say:
“The powers of financial capitalism had another far-reaching aim, nothing less than to create a world system of financial control in private hands able to dominate the political system of each country and the economy of the world as a whole. This system was to be controlled in a feudalist fashion by the central banks of the world acting in concert, by secret agreements arrived at in frequent private meetings and conferences.”
I would place the word ‘capitalism’ in inverted commas, since capitalism should be based on real capital not debt.
This is who Quigley is (no tin-foil hat for him): http://en.wikipedia.org/wiki/Carroll_Quigley
And don’t get him wrong, please, he writes about a lost opportunity here – something they’re having a go at right now.
Be happy. We are all slaves but we don’t know it.
I fail to understand how, spending and debt converge in your world. In my world, I spend what I can afford.
What loans would you be forced to take out? None.
Your choice, state housing or mortgage.
Bus or Car….
What did you choose?
To be a slave and know it? Or to be a slave, but don’t know it?
I don’t think that’s the only thing you don’t understand, Croaker.
@ Daphne: what are your sources of information? Bishop Grech is a son of a shop owner I believe. I think he’s been mis-reported or misinterpreted again. If you got your ‘detto del detto’ from The Times. I’m sorry but the paper has become sensationalist.
Well, well, no sooner had I submitted my comment here than the postman delivered my stimulus cheque. All $A900 of it. Yippee!
Now let’s see what I can spend it on … plasma TV (manufactured by some foreign company) … or some grog (my choice of tipple is Scotch, again foreign) … I know it will go towards a trip to Malta next year. Now that’s a better choice as a local travel agent will benefit. See you all next year.
Thanks, Mr Rudd.
@john schembri
Here’s a word for word extract from the Bishop’s speech
” Jekk sal-lum il-kotra kienu jghixu livell ta’ hajja gholi u wiehed kien jippermetti certu nfieq u konsum bl-addocc anke fuq hwejjeg li mhumiex ta’ htiega, illum mehtieg sens ta’ kejl fl-uzu tar-rizorsi privati u hekk naghtu aktar kas ta’ min huwa nieqes mill-mehtieg. Dan is-sens ta’ moderazzjoni fl-infieq ghandu jidher anke fl-attivita u c-celebrazzjonijiet li jsiru mill-fondi pubblici u hekk tidher cara l-ghazla favur li tigi evitata l-hela biex ikunu assigurati l-impiegi”
@ Anna f’kelma wahda “Mhux zmien il-kapricci” . Biex inkunu gusti hu semma’ it-tbatija tan-nies qiegheda u ssugerixxa li flok isir hafna infiq esagerat fuq il-festi nimmoderaw l-infieq u jitwaqqaf fond ta’ ghajnuna ghal min ikun milqut min-nuqqas ta’ xoghol.(RTK).
Int ikkwotajt l-orizzont:
http://www.l-orizzont.com/news.asp?newsitemid=53150
John, ic-celebrazzjonijiet u l-attivitajiet pubblici joholqu certu kummerc fihom infushom u jdawru lira fil-pajjiz, ibda minn dawk li jarma u kompli b’tal-gabbani etc. Dawn kollha ihaddmu n-nies, jaqilghu lira huma, u jergghu jonfquha. Katina wahda. Malli taqla holqa mill-katina, din ma tibqax shiha.
Anna, il-moderazzjoni ma’ toqtol ‘l-hadd, kif fhimtu jien per ezempju jinharqu inqas murtaletti, Se jaffetwaw fil-kummerc? Ma’ nahsibx. Tinsiex li hemm element ta’ solidarjeta f’li qal.
Daphne,
Would you not also agree that people need to be careful where they spend their money to help ease the recession? Going out and buying more and more junk off of Amazon may help bring in a little extra money in taxation for the Jersey government, but it certainly won’t aid your local community and keep people in their jobs. Individuals have to identify that there are some companies that, when they profit, help the local infrastructure of employment, and there are some that don’t. They should be supporting the first. MA
P.S. Would it not also be fair to say that advice from an institution that often has to receive debt cancellation from various nations, first and third world, due to their failed ministries is a little rich?
[Daphne – Yes, of course it goes without saying that we should spend money here, but we’re all interlinked and many of the problems we in Malta will face will be due to not enough people spending money in Britain, with not enough British people then able or willing to come here on holiday.]
John, biex inkun gusta, ma qrajtx id-diskors shih tal-Isqof, u dik il-bicca li kkwotajt kienet fil-fatt silta li dehret fl-Orizzont. Pero xorta nahseb li kwalunkwe suggeriment biex ‘nissikkaw ic-cintorin’ (kliem Mintoff) mhux se jghin. Appenna wiehed jibda jheggeg lin-nies biex jibzghu ghal flushom, jibda l-allarm u nibdew it-triq tan-nizla. Fi zmien il-Milied, il-gvern Ingliz kien naqqas il-VAT biex iheggeg lin-nies ha jonfqu izjed biex terga’ tibda ddur ir-rota.
Nahseb kien ikun iktar f’loku li kieku l-Isqof wissa lin-nies biex joqoghdu attenti kif u fejn jinvestu flushom biex ma jinxtorbux mis-sangisugi (i hope that’s the correct translation of bloodsuckers) li fuq kollox bdew din ir-ricessjoni dinjija.
Ma nafx jekk is-suggeriment li jitwaqqaf fond ta ghajnuna ghal min jitlef l-impieg kienx il-kliem ezatt tal-Isqof jew interpretazzjoni, izda ahna nhallsu n-national insurance biex jekk nitilfu l-impieg, ikollna il-beneficcju tal-qaghad.