The media has had a dominant effect on the way we understand economics as the media generally takes the point of view of the bankers, the politicians. These types of people are good at manipulating the media for their own purposes. This then can give them the power to generate a false perspective of economics. But it is one for a number of reasons they continue to generate. As part of this manipulation the media also gives a positive spin to privatisation.
Privatisation is where governments use investors money to buy services which had already been paid for by tax payers. A similar situation would be like handing over a house you had bought to a landlord so he could charge you rent at whatever rate he decides for the rest of your life. There is no benefit to the public in this. Any MP trying to convince us we will be better off as a result of privatisation is just passing us off with the standard government spin. Businesses that are privatised are predominantly paid for with borrowed money (Shares are basically borrowed money with the dividend as interest). All of us will be paying the interest on these borrowings for the rest of time.- even though we paid for the services outright in most cases while they were in control of the government. The door on privatisation needs closing and locked for good. All the U.K. governments of the last decade have joined hands in misleading its public on this. If they would only tell us during their election campaign I am sure they would never get the most important job in the nation. Having said that, the media seems to spend a lot of time trying to convince the public that we will be better off for privatisation. The media seems to spend too much time repeating the waffle of politicians, bankers, and people who are in businesses who will benefit from deals which are involved in privatisation, but spend little time analysing the actual effects of such deals on the public.
Privatisation does however help explain the governments loyalty to the stock markets, and no doubt makes the government a load of cash along the way. This would explain why U.K. and other National TV companies pummel their viewers on what is going on in the stock markets. Stock markets provide an almost endless stream of cash to pay for national owned services that the governments of the world want to cash in on. They therefore need to encourage that money which originates from deposit accounts, ISAs and other types of investment to keep providing fuel for the stock brokers to keep pumping up the prices of all businesses including the privatised ones. Banks and Stock brokers will do OK too.
As mentioned above, selling off a home which you have paid for outright, to a landlord, so he can charge you what he wants for the rest of time, including long after you have retired would only make economic sense to some one who had been educated at the wrong school or to a fool. Privatisation is exactly this, but only in this case it involves a national company we have all paid for, instead of your home.
The reason why governments have got away with this up to now is because the media has not carried out its duty in informing the public of what privatisation is really about. Also, in education, A levels in economics don't recognize problems created by privatisation, or in fact the stock markets or anything else which is being dealt with by 'Anti-Crisis Economics' such as Private Equity. The media and the world re-knowned education in the U.K. is letting us all down as far as economics is concerned and is beginning to appear as if it is intended to mislead us. Ofcourse it may be that all the TV reporters, newspaper columnists, politicians and bankers have all received out dated information through their economics degrees, which may be has not been up dated for twenty five years. If so, then the best thing David Camerron can do is get his economics up to date as this is not Hogwarts, its planet earth 2011.
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