Defuse the consumer debt time bomb: nationalise the banks!
Laurence Maples, Lambeth Socialist Party
Still recovering from the last crisis? Hold on to your wallet, Britain's bankers are storing up another one.
The Financial Conduct Authority has urged the government to tackle the explosion in consumer debt, now standing at £200 billion.
When even the fat cats are saying it, you can be sure the problem is serious. MPs have also highlighted the extent of the crisis, demanding an inquiry.
Nominal consumer debt has risen 24% in five years, increasing by a staggering 10% last year. At the same time, mortgage debt has increased by 10% - and student debt has risen by 114%, now at over £100 billion, due to the increase in tuition fees.
A rise in interest rates or increase in unemployment could bring this house of cards crashing down, with devastating effects for working class people.
Meanwhile, incomes have flatlined and in many cases fallen, so 8.3 million people now have problem debts.
Workers in the gig economy and on zero-hour contracts are forced to borrow for essentials, as their incomes can fall short of their needs at any time.
Predatory payday lenders make a killing as workers' debts grow and grow. Scandalously, local authorities chasing council tax arrears are often the most aggressive debt collectors, sending bailiffs round at the first opportunity and loading debtors with the cost.
All of this amounts to a looming crisis for working class people, potentially hit by a toxic cocktail of banks, payday lenders, councils, car dealerships, utilities companies and others demanding payments.
End this madness now. The Socialist Party demands:
- No foreclosures or evictions
- Guaranteed living incomes for all, including gig economy workers and those not working
- Nationalise the banks, finance sector and top corporations under democratic workers' control and management
- Ban payday lenders - with affordable finance available instead
- Scrap tuition fees, write off all student debt and introduce a living grant
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