That simple observation holds the key to explaining the post-79 era in British politics. How do you win an election? Inflate the property market. How do you mimic economic growth? Encourage housing equity withdrawal.
In savvier parts of the establishment, that relationship is now tacitly accepted. The latest Economist has a discussion on household debt in the UK that concludes: “It remains unsustainable for household debt to rise relative to incomes indefinitely … But for the time being rising debt may not be a bad thing … The British economy may be somewhat unbalanced, but at least it is growing.” This is the house journal of the departure-lounge capitalist class admitting that the British economy may be tapped out, but at least we can keep borrowing.
Credit isn’t the problem; a lack of investment is. Debt shouldn’t be our primary worry; just where growth will come from for the mass of Britons must be. And that is going to be a much bigger and tougher problem to solve.
Is Britain a nation of debt bingers? History tells a different story