Curb Bank of England Power
People Need To Accept They Are Poorer Says Bank of England
It's official... the people of Great Britain are simply here to struggle... as Brits ‘need to accept they’re poorer’, says Bank of England economist.
Britons must accept that they are poorer otherwise inflation will stay persistent, the chief economist of the Bank of England has said.
This announcement came just hours after another senior Threadneedle Street official insisted that the Bank would have been powerless to bring inflation under control even if it had acted faster on interest rates.
Speaking in an interview on the Beyond Unprecedented podcast by Columbia Law School in New York, Mr Pill said: “[People] need to accept that they're worse off and stop trying to maintain their real spending power by bidding up prices, whether [through] higher wages or passing the energy costs through onto customers.”
Demands for higher pay were only driving prices up further and “generating inflation” as a result, he said.
Interestingly, wasn't it the Banks who contributed further to the cycle of debt in this country by recently raising interest rates?
Obviously it's fine for the Bankers to increase their profits, as long as everyone else goes hungry, and remain poor!
Earlier on Tuesday, the Bank's deputy governor Ben Broadbent defended its record and denied that raising interest rates earlier could have made a meaningful difference.
Mr Broadbent said: “If we had started three, four, five, six months earlier [there would have been], I don’t know, maybe a maximum of half a point less inflation.”
Interest rates would have had to rise to nearly 20pc to completely stem the current bout of high inflation, he said.
Unions threatening to strike for better wages were quick to seize upon Mr Pill's comments, accusing him of being tone-deaf amid the largest hit to living standards in decades.
Laurence Turner, head of research and policy at GMB union, said: “It's staggeringly crass for one of the best-paid public officials to tell working people they should accept poverty wages during the worst cost of living crisis in living memory.”
In reality, Economists, Bankers, and Politicians lack the ability to mange any economy, using outdated logic, preferring instead to allow people to struggle on.
It's time the great British public woke up and consigned these charlatans to the history books.
Mr Pill’s remarks also angered trade bodies, with the Federation for Small Businesses (FSB) hitting out at the comments.
Tina McKenzie, its policy chairman, said: “Small businesses will be rightly angered by these tone-deaf comments from Mr Pill as they struggle with inflation that is still sky-high."
FSB national chair Martin McTague also described the remarks on price rises as "astonishingly out of touch", arguing that small firms have absorbed as much as possible.
Meanwhile, Simon French, chief economist at Panmure Gordon, recognised the risks of spiralling prices but advised Mr Pill to "engage brain before opening mouth", the Daily Mail reported.
Mr Pill compared raising wages and prices in response to high inflation to a game of pass the parcel, where each player was unwilling to accept the burden of higher prices that made them poorer.
He said: “That pass-the-parcel game that is going on here, that game is the one that’s generating inflation and that part of inflation can persist.”
Mr Pill added that there was a “reluctance to accept” that Britain had become collectively poorer but claimed it was an inevitable consequence of the surge in energy prices since the invasion of Ukraine.
He said people would have to eventually accept “that yes, we're all worse off and we all have to take our share.”
The comments risk reigniting criticism of the Bank of England for its handling of the worst inflation crisis in almost half a century.
The Bank’s Governor Andrew Bailey triggered anger last year when he urged workers not to ask for large pay rises and told businesses to stop trying to raise prices to beat inflation.
Critics argued Mr Bailey was trying to shift the blame for soaring prices onto workers and companies, rather than accepting the Bank’s own failings.
It came as former shadow chancellor Ed Balls said there was a need for greater public scrutiny of the Bank’s Financial Policy Committee (FPC), which is tasked with ensuring financial stability.
Mr Balls said: “As far as the FPC is concerned, there's much, much less scrutiny. Scrutiny is much less effective. There's a much less informed public debate.”
“I worry about whether we have transparency and process and clarity,” he added.
Mr Balls was giving evidence alongside former chancellor George Osborne to the Lord’s Economic Affairs Committee.
Come on people, have your say, get involved, it's time things changed for the better!