Fuel Tax and the National Debt

    By Richard Greaves

    Richard Greaves had a version of the following printed in The Brecon and Radnor Express on the 21 September 2000.

    The fuel crisis in which Wales was the most severely affected area in Britain is now coming to an end.

    Sooner or later the government probably will reduce tax on fuel, but if it does, there will either be cuts in government spending or increased tax on something else.

    But why do we pay so much tax in the first place? What about interest on the national debt — something governments barely mention?

    Presently about £30 billion per year comes out of our taxes to pay this — about 2/3 the amount spent on health and 50% more than the defence budget.

    The national debt represents the total amount borrowed by successive governments over the years, chiefly from the banks.

    It is presently about £400 billion and is going up all the time. In 1980 it was £90 billion and in 1949 it was£25.2 billion.

    Of course, not just governments borrow — individuals and businesses do so as well.

    Today 95%+ of our money supply is now made up of credit in the form of personal and business loans, mortgages and overdrafts.

    Only cash is created debt free and interest free by government, and that now accounts for less than 5% of the total supply. The rest is an interest bearing debt repayable to private banks.

    Banks create this money, or credit, out of nothing by a process which, in the words of J.K. Galbraith “is so simple that the mind is repelled”. [Money: Whence it came, where it went, Penguin 1975. Quoted on p. 18 of the 1995 paperback edition.]

    This begs the question, if banks can create money out of nothing, and lend it to the government which then spends it into the economy on public projects, why shouldn’t the government bypass the banks and create the money itself free of debt and interest and spend it on schools, hospitals and transport.

    The savings to the public purse would be enormous. Under the present system, if a new hospital is built, we continue through our taxes to pay the principal, and especially the interest, on the construction cost long after the hospital has been completed.

    As individuals, businesses and whole nations struggle under an increasing burden of debt the question is being asked — why is our money supply, the means by which we exchange goods and services, effectively under the control of the banking fraternity, for whom it provides vast profits, rather than the state?

    It is a question that goes to the very heart of who really exercises control in the world today — as banker Mayer Rothschild is once reputed to have said, “Give me control of a nation’s money, and I care not who writes its laws.”

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