By Adrian Ash
"If somehow we escape bankruptcy, we shall have set up an oppressive slavery..."
YOU DON'T NEED to read The Daily Telegraph to be told Britain's going bankrupt. Such forecasts have long been with us.
"By our political folly we have a put a large part, probably the greater part, of the nation in possession of rights to draw from the public purse," wrote Ernest J.P.Benn in his hilarious Account Rendered of 1930.
Hilarious how? Forced to live with the "smudge readers" at passport control, policemen demanding to see one's driving license, and Whitehall drones obsessed with how many pencil sharpeners their department controlled, Britain's moneyed classes knew the lower orders could only travel, drive and wear white-collared shirts if kill-joy regulations applied to the gentry and their staff alike.
But modern liberty, with its motor cars and mortgages, offered to keep Bolshevism out of Britain. Along with homes "fit for heroes" and the basic state pension, regulating it all added massively to the government's annual expenditure too – equal at the start of the Thirties to barely one-quarter of the economy.
That was already too great for the Pound Sterling to bear...
"Whether those (state-funded) rights take the form of relief, dole, pension, official salary, subsidy or interest on public debt, they all constitute heavy claims on our total production," wrote Benn.
"If happily, we manage to escape national bankruptcy, we have set up a slavery for the minority, the producers, far more oppressive than any previous form of bondage..."
Roll on 35 years, and even with Ernest's young socialist nephew – Anthony Wedgwood – grandstanding against reducing expenses, Britain just about avoided bankruptcy once more. Yet again, however, the other option – of defaulting in fact, if not in name – was too good to resist.
Just as the state defaulted in 1931, quitting the Gold Standard and offering to pay only more paper in return for Pounds, so the UK has long serviced and repaid its debts in devalued notes.
Prior to abandoning the Gold Standard eight decades ago, only Charles II had reneged on his debts, ordering a "stop of the Exchequer" in 1672 that halted payment of interest on any debt without a specific tax revenue ear-marked to cover it.
