There is an active campaign to “defund the BBC”, i.e. strip it of its license fee. Having watched a programme they broadcast on the 25th of January one can understand why. The programme was entitled “The Decade the Rich Won” and its key proposition was that the effect of QE following the banking crisis of 2008 was to make the rich richer while the poor suffered.
This joint BBC/Open University production pretended to be a documentary of the financial crisis and subsequent events. It included a number of interviews with major personalities involved such as Mervyn King, Alastair Darling, Nick Clegg, George Osborne and Guy Hands but also a few nonentities. It appeared to have been carefully edited to present a slanted view of history and in effect an attack on capitalism.
The purpose of QE was to increase economic activity by providing more liquidity to banks and this is what it did. As Mervyn King said it prevented a great depression as we had in the 1930s. Guy Hands said it was the right decision but it had unintended consequences. The problem was it inflated asset values as money was pumped into the economy.
That of course meant that those who owned assets such as buildings or company shares became wealthier. But it is wrong to suggest that just benefited the rich and hedge fund managers as the programme implied. In reality anyone with a pension scheme or who owned a house tended to benefit, i.e. a large percentage of the population. And those who did not at least had their employment protected by the economy being supported rather than being allowed to decline with job losses following.
There was a clear attack on the big banks and their owners although nobody mentioned that the owners of banks such as RBS and others suffered from full or part nationalisation (i.e. confiscation of their assets).
There was no discussion about what else the Government and Bank of England could have done instead.
This programme was a polemic against the bankers and asset owners of all kinds. It was likely to encourage a very distorted view of history as opposed to being an unbiased analysis of the financial difficulties of the era covered.
It looked like a left-wing socialist manifesto in essence by implying the rich toffs escaped the economic crisis while everyone else suffered. That’s not the reality.
Roger Lawson (Twitter: https://twitter.com/RogerWLawson )
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