Alright, welcome back to Garys Economics.

Today we are doing what is hopefully the final

one-off special of Garys Economics this year.

We're going to explain everything you need to

know about the upcoming budget and asking and

answering the rather sensationalistic question,

is this budget the end of British democracy?

OK, I don't like to do videos on the budget, and at

the moment, if possible, I don't like to do videos at all.

But this is going to be a massive moment

politically in the UK. I think it's

really, really educational, economically.

I think what's happening in this budget is going to

be a really great example of basically everything

I've tried to basically educate you about on

economics this year and the most recent years.

So I want to go through it.

A big thing that will happen in this budget is

that the government will raise taxes significantly.

Some people might try to say that this is what Gary

wanted, this is a wealth tax, so we want to make it clear

why they're raising taxes and

why it's not a wealth tax.

Alright, so the first thing is, the government is going

to really quite significantly raise taxes in this budget.

This is kind of crazy because they came in promising

not to raise taxes, they're already very unpopular.

They're going to raise taxes, it's going to be kind of

like the political suicide of the Labour Party.

Why on earth would they do this?

It doesn't make any sense.

So if you watched my video I did, 3 months

ago video, predicting this budget, I said

that it would be a massive tax raising budget.

At the time I was sort of speaking to think

tanks and trying to get some info from Labour MPs.

At the time it looked like they were going to sort

of focus those taxes on the middle class, the upper

middle class, largely because sort of your average

British person doesn't have anything left to tax.

Since then, it looks like they might

go for something a bit more broad.

There were a lot of whispers of raising

the basic rate of income tax, which would hit everyone,

but now it looks like we're going to get what people

are calling this sort of smorgasbord of tax rises.

So when the government was campaigning, they promised

not to raise income tax, National Insurance on

employees, or VAT, which are the three big taxes.

If you want to raise a lot of money, these are

the three taxes that you would normally look at.

There were rumours they were going to

break the promise on income tax.

Now it looks like they're not going to do that.

As a result, since they want to raise a lot of

money, they are probably going to have to do like 25

different tax rises, all kinds of different things.

Some of which will be targeted on richer people, none

of which it seems will be targeted on the very rich.

And some of which, such as freezing the thresholds

on income tax, will hit predominantly poorer people.

So it looks like they are going to basically

raise taxes on absolutely everybody.

Except the very rich, which is exactly the

opposite of what we campaign for here.

We call for tax wealth not work.

It's going to be phenomenally unpopular.

I think it's probably going to be another line on the

gravestone of Keir Starmer Premiership, quite possibly.

I think he'll likely go.

Yeah, why?

Why do this, this crazy politically suicidal thing?

So what the media is largely reporting

around the question of why the UK government

is raising taxes tends to focus on the

fiscal rules, which are these rules which the

Labour government set itself around promising

to basically try and get the debt to reduce,

you know, not to spend more than you raise

in taxes, lots of very sensible seeming rules.

And the idea is because interest rates have risen

significantly, and also because UK growth has been

weak, it means that if the UK government wants to

keep its fiscal rules, it basically

needs to significantly raise taxes

or significantly reduce spending.

I think the focus on fiscal rules is a

little bit misleading, to be honest, because

beneath the fiscal rules and really a big

motivator for these fiscal rules is the fact that

financial markets, in particular the government

bond market has been really heavily breathing down the

government's neck really ever since it came into office.

So I think if you want to understand why the

government's doing this, you need to understand a

little bit about what's going on in financial markets.

So I just want to re-cover I think one of the

most important videos we did this year, which is

about the dynamics of the UK government debt.

I think we'll flash up a link to the full

video in case you want to get the details on it.

But it's important to recognise that debt

dynamics are really driven by the interest rate.

The interest rate which I'm going to call here

'R'. Now after 2008, this interest rate

fell to very low levels, about 2%, and

into COVID, it went all the way down to 0%.

Now if you're paying 0% interest on your debt, it kind

of doesn't really matter, basically how much debt you

have, because you're not paying any interest on it.

But in the last few years, this has gone up to

about 4.5% or maybe even 5% on longer term debt.

Now what is important about this is,

what is significant for your government debt is

how big it is as a proportion of your economy.

Now,

your debt is fixed as a pound amount, but

it goes up by your interest rate every year.

And your economy increases by 'G', economic growth,

but it also increases by 'I', inflation.

If you have inflation, then because your

debt does not go up with inflation, your

economy goes up and your debt doesn't.

So really what matters in terms of sustainability

of your government debt is where the interest

rate is bigger than growth and inflation together.

And this was not true back when

interest rates were very low.

Growth in this country is about 1% a year.

It hasn't been significantly

above that for really 20 years or so.

And inflation is usually about 2 to 2.5%.

At the moment it's still a bit higher.

That means we can expect the economy to

grow in pound terms by about 3.5% a year.

And the debt is growing by interest by about 5% a year.

This means that.

Unless growth goes up, which is unlikely, unless inflation

goes up, which the Bank of England is supposed to stop,

debt will basically increase and increase and

increase as a percentage of the economy.

And that means that unless the government does

something, eventually debt will get bigger and

bigger and bigger and bigger and it's unsustainable.

And when financial markets look at that,

they think, well, here's a government which

is not long-term financially sustainable.

And for that reason they continually

analyse everything the government does, and

they think if the government does anything

that at all deteriorates their likelihood of getting

their debt paid back, they start to sell the bonds.

And we've seen that a number of times in recent years.

The most obvious time was the Liz Trust

debacle, which was a few years ago now.

But we also see the financial markets

move quite significantly against this

Labour government in January this year.

And they even start to put a little bit of heat on

just a week or so ago when the government

announced it wasn't going to raise income tax.

Now we all saw what happened to Liz Truss, who, for

anyone who doesn't know, is the shortest lasting

Prime Minister, I believe, in the history of the country.

The only reason she lasted more than a month is

because the Queen died, otherwise she probably

would have lasted just a couple of weeks.

And Labour know that as well.

In fact, Labour really capitalised on that.

They put a lot of pressure on the

Conservatives, saying you're fiscally

irresponsible, Liz Truss blew the economy up.

So of course they are constantly terrified

that the markets will do this to them.

So really, financial markets are

driving a lot of this Labour policy.

Pretty much everything that they do.

Is really calculated to avoid the

financial markets attacking them.

I think it's important to recognise that in January, we

came relatively close to the financial markets taking

this government down, and it was only because of

one very, good, very lucky, low inflation number that the

government survived, and the government is basically

terrified that they do a budget, financial markets turn

against them, the government bonds sell off, and

they're forced to basically do another budget.

Some people will say and sometimes do say, like,

why don't we just ignore the financial markets?

And I understand that because obviously you live in

a democracy and you expect the public to determine

the policy of the government, and you don't

like to see financial markets dominate it.

The answer to that is if your economic policy is

to constantly borrow money from financial markets,

then you need to keep financial markets happy.

And in a sense, this is the reason why I

constantly campaign for wealth taxes.

So since COVID, inequality has increased significantly,

and one manifestation of that is a big transfer

of wealth from the government to the very rich.

And you see that in the form of significantly

higher government debt and significantly higher

savings from the very rich.

Once you've done that, then you are then in a situation

where the government, if it wants to provide things like

basic services, needs to somehow get those resources

back or get access to those resources from the very rich.

And there's a couple of ways you can do

that, but the most obvious ways are you

borrow from the rich or you tax the rich.

If you choose not to tax the rich, then the only

way for you to get government services like the NHS,

like education services, are to borrow from the rich.

So basically, as long as

governments refuse to tax the rich.

They will be consistently, entirely dependent on

borrowing from the rich, which means they will need

to do whatever the financial traders ask of them.

Because they are completely dependent on the financial

traders, who are the people who decide whether or

not the rich lend their money to the government.

So the key here to understand why

the government is raising your taxes.

Is it's not really about fiscal rules, it is a little

bit about the markets, but really, what you have

here is a question fundamentally about distribution.

The reason I started this channel at

the beginning of COVID is because I could

see the distribution was going to change.

I could see an enormous amount of wealth was

going to go from the public and governments to the

very rich, and I knew that that would lead to

the kind of situation that we are in now.

The government has negative wealth now.

The rich have positive wealth now.

Now underneath that, what you get

is a change in cash flows.

And I think I'll link to our video Flows of Wealth.

Because what I want you to understand is when you

lose your wealth and when the government loses its

wealth, that is not a thing that happens in abstract.

There are cash flows beneath that.

So now the government is heavily in debt to the rich,

and it needs to pay that interest every single year.

That means that in order for the

government to provide the same level of

services to you, they need to tax you more.

But every year, as the government pays more debt

to the rich, the rich will get richer, you will get

poorer, and this situation will compound and get worse.

So really what you are seeing here, it's not so much a

question of government incompetence as a very obvious

and natural consequence of a changing distribution.

As inequality increases, as you and the government

have less wealth and the rich have more wealth,

the only possible way for you to get public services

is for the government to tax you more, which will, of

course... and bear in mind they're using that tax to pay

the interest to the rich, so it will inevitably lead to

a greater wealth inequality, which will lead

to great... which will lead to greater cash flows

from you to the rich, and this situation will

compound and get worse and worse and worse.

And it is the only way to keep the state alive

without wealth taxes, is to constantly tax you

more and to constantly tax the middle class more.

So, this kind of discourse which we get a

lot around the government taxes us so much, the

government taxes us so much, we need to reduce taxes.

That is inevitably what will happen.

If you have growing wealth inequality and you do

not tax the rich, you basically have two choices here.

Either you tax the rich and you get your

government services, or you squeeze everybody else.

This is fundamentally a problem of distribution.

So that leads us to part two here.

Which is why not the wealth tax.

So, obviously, anyone who's watched the channel

for a long time will know that I've been

a campaigner for wealth taxes, for greater

taxes on the very rich for a long time.

I predicted that the government

would do what it has done.

I predicted the government

would squeeze the middle class.

I predicted that living standards would fall.

I think that these things are basically

unavoidable in the absence of wealth taxes.

So why is this desperately unpopular government

not going after the very rich.

So this is an interesting question, and the last

few weeks I've been working on this documentary with

Channel 4, and as a part of that I've been going

around speaking to lots and lots and lots of

self-professed, phenomenally intelligent people who

like to tell me why we shouldn't have wealth taxes.

And I think what we have here,

really is a fundamental misdiagnosis of the problem.

I think when Labour were coming into power,

when they were campaigning for the election.

I think they thought that the problem

that we had in this country was a problem

of corrupt and incompetent government.

I think that they thought that the Conservatives

were corrupt and incompetent, and there may well

have been like a strong element of truth to that.

But I think that they thought that that

was kind of the limit of the problem.

I think that they felt that once they got the

sensible, mature people in charge who, they

felt were themselves, like most of us do, I

think that they felt the problem would resolve.

But they were phenomenally naive,

like I think most economists

unfortunately still are, to the relatively simple

fact that the wealth distribution matters.

So, you know, there were lots of stories about

conservative incompetence, especially during

COVID, conservative corruption during COVID.

But what there were a lot fewer stories

about was this massive change in the

wealth distribution, which I've been

screaming about since the beginning of COVID.

Those people who've watched the channel since the

very start will remember the videos I did about the 600

billion and the 700 billion and the 800

billion, which is now over £1 trillion.

which is the total amount of wealth which was

transferred from the government to the very rich.

I'll mention it again because I haven't spoken

about it on this channel for a long time.

So if you've been watching this channel for

a long time, you'll remember that early on

in COVID, I used to talk about the enormous

amounts of money given out by the UK government.

I think the first video I did was 650.

Billion pounds, 650 with 9 zeros, then that became 750

billion and that eventually became over 1 trillion, which

is 1 with 12 zeros, which is a number so big doesn't make

any sense to anyone, but I think it's better understood

as £20,000 for every single adult in the country.

So at this point, the UK government since the beginning

of COVID has given £20,000 for every

single adult in the country, which means unless not

only you, but every single adult in your household,

in your family, in your friendship group has £20,000

more money, somebody has your £20,000.

I believe that this has been accumulated

largely by the richest people in the country.

And what that means is there's just been a

massive, massive transfer of wealth, a massive

change in the wealth distribution, ordinary people

are poorer, the government is much poorer, and

that wealth has been accumulated by the rich.

I think Labour came in...

you know, and the same thing could be said of the

Biden government in the US or really basically

any government that's come in the last 5 years.

Governments came in thinking that as long as

they're sensible, they'll be able to fix the problem

with basically nothing to say and in reality

having never considered the fact that the wealth

distribution has massively, significantly changed now.

And I've used this metaphor a number of times

on the channel, but I really think it is the

best way to understand why our governments

and our economists keep failing on the economy.

This is as if you have cancer and your doctor

does not know cancer exists.

We have very significant increases in inequality

in wealth distribution happening, especially during

COVID, massively during COVID, and yet we do not

have anyone in government who comes in saying let's

address that change in the wealth distribution.

So then you end up in the kind of situation

we're in now, where a government comes in,

just thinks it can kind of like,

manifest its way out of a crisis through just extreme

sensibleness with absolutely no willingness to engage

with the fact that the wealth distribution is bad.

This is like you coming into a game of Monopoly

when everything's owned at the end, recognising all of

the properties are already owned and just being like,

well it's OK because I'm really ****ing good at Monopoly.

Like you have to address

the changes in the wealth distribution.

And if you don't, then you will constantly find you

are paying so much money to access wealth you don't

have, you are paying so much money in debt interest

that you are simply constantly running out of money.

And what you are seeing as running out

of money is basically the fact that you

don't have the ****ing resources anymore.

And if you do not get the resources, then you're going to be

paying everything out in order to access those resources.

So really,

it's a fundamental misdiagnosis

of the problem and just basically

a naivety about the significance of wealth.

And the irony of it is

this group of people who are completely unaware

about the importance that the broad public owns

wealth, that the government has access to wealth,

are themselves usually pretty wealthy people.

So yeah, what I've sort of seen going around

London and the country the last few months

is what I've started to think of as the

League of Extraordinarily Smart People, which is

a bunch of politicians and economists who have ideas

about the economy that never consider distribution.

And have never had to test their ideas

in a way that traders have.

So they tend to believe that as long as

we're sort of a bit more sensible, a bit more

managerial, a bit more technical, we can get our

way out of this problem, crucially without ever

having to tax rich people, and they, in general they

really, really, really don't want to tax rich people.

And I think this is largely because

they themselves are quite rich, they sit towards the

top of the sort of social hierarchy in this country.

They don't want to upset rich people, they're

funded by rich people, but crucially, I think you

have this kind of basically fundamental conservatism,

which very often comes with the fact that you

are in the top 1% richest people in the country.

These decisions are made by people who are rich, they

don't want to tax rich people because they are rich.

They never have to test their ideas, they

only really have to convince each other.

You know, if you look at the group of people,

the politicians, the economists, the tax

lawyers who are doing this, they're rich people.

It's not difficult for them to convince

each other we shouldn't tax rich people.

They all tend to come from the same kind of

cultural space, you know, upper middle class or wealthier

people, sort of mathsy, academicy, bean counting types.

But ultimately, at the end of the day, they

don't want to rock the boat or do anything that

they view as wild or extreme or reckless.

And crucially, what I think to you, or

to most ordinary people in society,

feels like a society drifting into poverty, falling

off a cliff, collapsing, to them, feels like the

preserving of a perfectly decent social order.

And I think the reason you have that

is because a crisis of inequality

feels bad for most people, but it

feels phenomenally good for the top 1%.

And it feels pretty good for the top 5% because

they are the guys who are accumulating

the money, they are the guys on other side of

this, they are the guys who are getting richer.

I want to flash up a little clip.

It's an interview recently by Martin Wolf, who's a

very prestigious Financial Times economic journalist.

He's been writing for them for many, many years.

And he went on Novara, which is a

friends of the channel.

I've been on there many, many

times, and he was asked, you know,

"What do you think is going wrong with the

UK economy?" And I think his answer was very

clarifying, I think, about the way rich people

feel about the way the economy is run.

The way I want to frame this question is you've been

at the FT since 1987, so you've been reporting on

economic policy in Britain during the Thatcher years,

the Major years, the Blair Brown years, all the chaos

we've had since 2010 and now the Labour government.

How does this Labour government, Keir Starmer, Rachel

Reeves, compare to what you've reported on, what you've

commented on, what you've been analysing, before?

Well, I think,

first of all, I think that these

are perfectly decent people.

It's quite important, because we've had

some prime... well, we've had one or two prime

ministers in the not too distant past

who I don't think were very decent people.

I've gotta be honest, I kind of love this.

So what you have here is, you know, I

don't know Martin Wolf's personal situation.

I suspect a pretty comfortably wealthy person.

Analysing a government run by, again, pretty comfortable

wealthy people, same sort of social

cohort in a sense as he is in now.

And I think if you were to ask your average

man on the street, like how has this government

done in terms of living standards, the vast

majority of people would be very disappointed.

They came in on a promise of not raising taxes,

growing the economy, they're

about to raise taxes, they've not grown the

economy, living standards are falling, and what

does one of the most prominent economic journalists.

In the country have to say about that,

that these guys are perfectly decent people.

And what this shows you basically is

these guys are happy because it works for them,

and because they like the country to seem...

they like the country to be run by people

who look like them and sound like them and

manage the country in a way that works for them.

And I think that the big lesson I think that

you need to learn from this is that these

guys are not going to fix it for you, it's going to have

to be your job to force the changes that you need.

What most of the guys want who are rich.

In their heart of hearts is just to stay

rich, and they want to stay at the top, and

they want their kids to stay at the top.

And that is the reason that they are blocking things

like wealth taxes, because they want to stay at the top.

But obviously they can't say to themselves or

each other, the reason we're blocking change

is because the status quo keeps us rich.

So what they say is, you know, we are perfectly decent

people trying to do perfectly decent things.

And what this reminds me of, since this

is my last video, I'm going to indulge myself.

I'm trying to get a few more

literary references into the channel.

This reminds me of one of my favourite books,

which is a book called Candide by, a French

philosopher from I think the 1700s called Voltaire.

Yeah, so this book is about the idea, which was

very popular in the 1700s, that the world that we

live in must be the best of all possible worlds.

And this was a Christian idea

that was popular in the 1800s.

And there's a logic to it, which

is we're all Christian, obviously.

God is a good guy, he's all powerful, he's all

knowing, and he created the world like this.

And since he's a good guy and he's all powerful and he's

all knowing, he wouldn't have made the world this way

if the world wasn't supposed to be this way.

And there's a logic there, you know,

like, you know, why would God would have done this if

this wasn't the best it could possibly be?

And this is obviously a very sort of fundamentally

conservative belief, basically says you shouldn't

try to change things because you're like ****ing

with the natural order as determined by God and

you know, you're basically, you know, ****ing with God.

And in this book, you know, this guy called Candide

goes around and looks at all the ways in which

the world is obviously not functioning well and

Candide's professor, a guy in the book called

Pangloss, says, well, you know, this is the best of all

possible worlds, you know, so don't mess with it.

And what I see when I talk to most

of the guys I'm talking to who are opposed

to wealth taxes, politicians and tax

lawyers and phenomenally wealthy people.

Basically everyone I speak to who's not

rich thinks we should tax the rich more.

But all of the rich people, including people

like Martin Wolf, seem to believe these

things, that this is just the way that things should be.

And they have all of their rationalisations, such

as if you try to change things, it's not going to work.

Or you know, these are perfectly decent people trying

to do their best, wealth taxes are wild and unrealistic.

But what you are really seeing, I think, is the same

intellectual impulse that we have seen for hundreds

of years, which is rich people want to stay rich.

So what the **** are you going to do about it?

That brings me to part three of my video, which is

the death of democracy, which I think is really the

most interesting thing about what Labour is doing

here, which is what you have here is a political

party that campaigned on not raising taxes and

didn't want to raise taxes, and won an election

on not raising taxes, and has then come in, and

is about to significantly raise taxes, which

their voters didn't want them to do, and

they themselves even didn't want to do.

And what does that mean,

I think, for democracy?

I think this is the consequence of naivety

about wealth, right, which is we now have

governments that are very impoverished, presiding

over a public which is themselves increasingly

impoverished, as the wealth accumulates to a tiny

minority which the government refuses to tax.

When you understand that that is the structure

of society and that wealth continues to flow

from the government and from the public to

the very rich, what you understand is these

governments are of course completely powerless.

If all of the wealth and all of the power is held

by this tiny group, and we refuse to ever... I want to

make it clear, this is not just an abstract concept,

these guys own the land, these guys own the property,

these guys own the businesses, these guys own

your mortgage debt, these guys own the government debt.

All of the important assets which you need

to run your economy are owned by these guys.

And if everybody else not only has

no wealth but increasingly is in debt to these people,

of course your government will have no options.

What you are seeing here in this like loss of

wealth of the public and the government and the

accumulation of wealth by the very rich. It is really,

it's like the ex-factorisation of democracy,

basically, like you can vote for whichever

winner you want, and you can have that winner

like dance on the stage for you, to, you know,

things can only get better or whatever, you know.

But if they have no wealth, and they have

no access to wealth, they have no power.

So you will end up in these absurd situations

that you get in now.

Where a government promises not to raise taxes,

promises to improve the economy, doesn't want to

raise taxes, wants to improve the economy, comes in and

realises we've got no wealth, we're massively in debt,

there's literally nothing we can do except exactly

what the rich tell us to do, which is shut down the

welfare state, tax ordinary working people, and drive

the economy into worse and worse living standards.

Alright, so part 4 of this video is what do you do?

The first thing to recognise

is that this is all a bit ****, isn't it?

Like living standards are going to get worse.

In this budget, taxes are going to be raised on higher

earning working people, and also, especially if

we look at the freeze... the freezing of the tax

thresholds, even lower earning working people.

And if you,

are somebody who has a little bit of

excess money, a little bit of discretionary spending,

you should obviously tighten your belt a little bit.

You should try your best to

avoid, stay away from consumerism.

But I think it's important to recognise,

especially with things like freezing of the tax

thresholds, which are raising taxes on even lower

earning working people, the income tax comes in at

£12,000 year, which you definitely can't live on.

There will be a lot of people in this country who

will not have the money to pay this extra tax.

And I think it's important to recognise that if you

are somebody who can afford to tighten your belt

a little bit, what I want you to do is recognise

what is happening here, which is that as wealth is

accumulated at the top end of society, more and

more people are being squeezed out of wealth ownership

completely and are being squeezed into debt.

And if nothing is done, what will happen is

that squeeze will move further and further

and further and further and further up society.

It is important that you stand up

for those poorer than you now.

Otherwise, eventually you too, will be squeezed out.

I think this budget could be an opportunity

for the middle class and the working class of

this country, who are eternally divided by cultural

history, to realise the fundamental truth,

which is that you guys ****ing need each other.

If you, the middle class, do not stand by the

working class now, you will be squeezed out as well.

I want you to recognise that the situation we are in

now in the UK, in the West, with a decent sizable middle

class of 30% of people who get to live relatively

comfortably, is not historical or international norm.

If you do not protect it now, you will lose it

and we will go back to the kind of situation

we were in in this country 100 years ago, which

is still common around the world, where the vast

majority of people live in poverty, including you.

If you want to fight against this, it really, really

requires the middle class and the working class to stand

together and demand increased taxation of the very rich.

That is the only way for you to protect

your financial interests in the long term.

All right.

Last one I've got here is sources of hope, which,

I hope people have recognised I try to get into

my videos as much as possible, because I don't think

we're going to get out of this if we're all depressed.

I think there are some things to be hopeful here.

First thing is, the argument about

taxation of wealth continues to massively

grow in popularity, in media salients.

People are talking about it more and more and more.

I think we have a little bit of

a short-term opportunity here.

I think there's a very good chance that Labour,

who are already very unpopular, and the

Keir Starmer leadership, which is already very

unpopular, will become significantly more popular,

sorry, more unpopular, after the budget.

And I've always said that I think Keir

Starmer will probably go, probably after

the local elections in May next year.

Betting markets are moving in that direction as well.

Betting markets are starting to think that,

also that is what probably will happen.

At the same time, we've seen the massive growth

in the polls of the popularity of the Green

Party under the new leadership of Zach Polanski,

who very aggressively campaigns for wealth taxes.

There is a possibility here that next May or next June

we have a Labour leadership contest in the context

of an extremely popular party calling for wealth taxes

who are significantly beating Labour in the polls.

If that happens, there is a chance, and I'm not saying

I think that this will happen, but I do think that

we have a chance of this happening, that we get a new

Labour leader who realises the only way to... for Labour

to win the next election is to start listening to us

on wealth taxes and start helping us design those taxes.

We could get that.

I'm going to push to get that.

I'm going to bring the channel back before that

happens so that I think we can be in position to get it.

But things can change.

Things can definitely change.

I want to talk a little bit about history

because there's a couple of graphs here that I

think are really interesting that I'm going to flash up.

One is the recent, like, debt dynamics of

the UK, so how much debt is compared to GDP.

We'll flash that up.

And what you can see is that UK government debt

has increased significantly in the last 20 years,

especially during 2008, but especially during COVID.

When you look at that graph,

you might think, "Oh, well, we're ****ed.

UK government's massively in debt." But it's

important to recognise that that debt is not to nobody.

It's not to aliens.

That debt is significantly to the British people.

If we tax the wealthy British

people, we can get that back.

But what I want you to compare that with is this

much, much longer term graph of UK government debt.

And when you look at that graph, what you see

is government debt now is enormously less than

what it was in the period after World War II.

And what is interesting about that period after World

War II when the UK government debt was incredibly

high, much higher than it is now, basically because

the government had just paid for this incredibly

expensive war, that was the period when we saw these

unbelievably increased living standards and this

incredibly ambitious government that did things

like create the NHS and make sure that housing and

healthcare and education were basically universally

accessible to basically everyone in the country.

What that shows you is that large-scale

government debt does not stop you from

achieving amazing things as a country.

But you need to be ambitious.

You need to be able to think big.

And crucially, you need to be willing to

do what the government did at that exact

time, which is tax your goddamn rich people.

If all of the assets are owned by the rich, you can have

a good state and a good country and a good economy and

good living standards if you are willing to tax the

people who have the assets, the wealth, and the power.

It is simple as that.

And I think, you know, what this longest term

graph shows us is that things can get better.

Things can get better.

You know, I've said this before and I'll say it again.

You know, my grandmother was born in London, in

the richest city in the richest country in the

world at the time, and three of her siblings died of

tuberculosis, which a di- which is a disease of poverty.

You know, that is what happens in rich countries if you

don't manage... if you do not manage your distribution.

And within 20, 30 years, we had the world that

my parents grew up in, where an ordinary person

could get an ordinary job and could buy a

house and could go on a few holidays and could

have a retirement and could raise a family.

These things are possible.

These things are possible.

But it can go either way.

If you do not fight that battle about wealth,

assets, distribution, and tax, then you will not

have the resources you need to fight any battle.

The key here is whether we stand

together or whether we're divided.

There's one way this budget can go.

The government's going to bring in like 25 different

bull**** taxes and we can all start squabbling

"Don't tax me, tax my next door neighbour." Or we

can all stand together and say, "Listen, tax the rich.

Tax the rich, fix the distribution." And that is going

to determine which way this country goes, basically.

Yeah, it's a question, I think.

It's a question for the British public.

Are you going to be able to have compassion

with those who are worse off than you?

Are you going to stand together and

are you going to fight for your rights?

or will you be divided?

Listen, stand together.

You're going to need each other.

We've won before, we can win again.

Good luck.

This is the last video of the year, hopefully, unless

there's some ****ing massive economic collapse

or the markets go mental and I have do another one.

I'm done, hopefully.

Thank you very much.

Just a couple of small things.

Thank you all for your support.

Thanks to everyone on the Patreon.

Thanks to everyone who worked

on helping us make the channel.

I'm on tour in Australia

and New Zealand, February, March.

If you are one of our Australian

or Kiwi viewers, check it out.

I think it's called The People's Economist Tour.

And this last thing, it's a bit selfish, but

I have found out that my book, The Trading Game,

is in contention to be the best-selling

non-fiction book of, 2025 in the UK.

So, if you want me to be number one again,

then maybe consider this as a Christmas present.

Thanks very much.

To the government, tax the

rich, otherwise it's going to be ****.

And to the people, don't rely on them.

Stand together.

Thank you.