Christmas prawns? No thanks

Tips for surviving the festive season with your Christmas spirit and green credentials intact

It’s far too early to start talking about Christmas, but I’m afraid I have no choice. Improbably snow-bound English villages, 'seasonal' recipes for prawns and this year’s must-have gadgets, are cluttering up every advert break. So, as I too have already been out recording ‘Green Christmas’ specials for the TV, and have been doing my research, I thought I would strike back early too.

Christmas, like the average wedding, is becoming more elaborate each year. What started out as a simple trip to church and a big meal now lasts about nine weeks and involves buying more and more every year.

It’s impossible to avoid taking part, because everything to do with the Christmas season, no matter how newly invented, becomes instantly ‘traditional’. Secret santas, Harry Potter films, East Enders, chocolate fountains. All suddenly compulsory as if they had been around forever. And yes, what about those king prawns? Since when were tropical crustaceans a staple part of midwinter cuisine?

Believe it or not, I do love Christmas. It’s the only time of the year where my voicemail and inbox calm down and I can spend a few days eating, drinking and playing board games with my sisters and family without a bulging ‘to do’ list nagging at the back of my mind. At its simplest as a family get-together, Christmas is a joy, but it’s so easy to let things get out of hand during the run-in and be swept away in a consumer frenzy that – needless to say – can have a terrible effect on the planet.

It’s not energy use that soars at Christmas (in fact with us all staying in and drinking egg-nog, the roads are unusually quiet, and sharing the cooking has its energy plus points too) but the quantity of stuff that gets bought, wrapped, cooked and then simply wasted. Each of us receives around £90 worth of unwanted presents each year, and over a third of the food we buy is thrown away uneaten by twelfth night.

So, with my bah-humbug detector turned up to maximum, here are my green ideas for a better Christmas, with more fun, less stress and less waste.

An easy one to start off with: buy nothing this Saturday. Yes, for twenty-four hours take a break from shopping, put that Christmas list aside, take your life back and buy nothing at all in a celebration of non-consumerism.

An ideal day to spend in front of the TV, scorning adverts featuring Jamie Oliver or the Spice Girls, or at the pub with your mates talking rubbish. (I haven’t checked the small print, but I think the rules of Buy Nothing Day may exempt purchases at the bar.)

Next, food. A typical Christmas dinner these days can contain ingredients that have been transported over 30,000 miles, but it’s really easy to cut this down simply by picking local products off the shelf instead of far-flung alternatives: hazels rather than brazil nuts, English beer rather than Australian wine, local ham instead of Indonesian prawns.

The original midwinter festival involved a feast of seasonal produce, embellished with preserved items from earlier in the year, so root vegetables, cabbages, sprouts, dried fruit, nuts, local cheeses and chutneys are all real traditional low-carbon fare.

Don’t get hormone-stuffed, frightened food for your roast, invest in an organic, free-range bird from nearby, and ‘offset’ the extra cost by getting a smaller one. It’ll taste so much better and, with fewer grotty bits, you won’t have to worry about forcing leftovers down your relatives.

Visit your local market for a real bargain on the rest of the meal, compared with overpriced supermarket vegetables. You’ll be supporting your local economy, plus, if it’s unpackaged, you can buy just the amount you need and won’t end up throwing half of it away.

Moving on to presents, as we must. Let’s start by ruling out pointless gadgets that will simply end up in the cupboard after a couple of weeks. No golf ball polishers, no coffee machines that need an endless supply of little plastic cartridges, no choppers, heaters or mixers that can only do one thing - no attic fodder at all.

Instead, get non-material gifts: something useful like tickets to an event, vouchers for meals, downloads or books, or membership of an organisation such as the National Trust or the RSPB.

If you feel obliged to get something that won’t fit in an envelope, use gift-giving as an excuse to introduce your friends and family to green stuff. Basics that everyone needs are best. Get bamboo t-shirts, hemp socks, quality recycled notebooks, local organic foodstuffs or non-polluting shower gel, and make sure they know where to buy replacements when they find they love them and want more.

At the end of the season, make sure everything is recycled. We create three million tonnes of extra waste over the Christmas period and use over 250,000 trees’ worth of wrapping paper, so buying recycled and putting everything from the Christmas tree to your sprout peelings in the recycling box or the compost bin is essential.

So, there’s my very brief seasonal tips and the bah-humbug detector has hardly flinched. I hope this shows that having a ‘perfect’ Christmas doesn’t involve going crazy and consuming everything in sight, and that having a ‘green’ Christmas doesn’t involve shivering around a candle in fingerless gloves for a fortnight. Just don’t forget to shun those prawns!

Sian Berry lives in Kentish Town and was previously a principal speaker and campaigns co-ordinator for the Green Party. She was also their London mayoral candidate in 2008. She works as a writer and is a founder of the Alliance Against Urban 4x4s
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We're racing towards another private debt crisis - so why did no one see it coming?

The Office for Budget Responsibility failed to foresee the rise in household debt. 

This is a call for a public inquiry on the current situation regarding private debt.

For almost a decade now, since 2007, we have been living a lie. And that lie is preparing to wreak havoc on our economy. If we do not create some kind of impartial forum to discuss what is actually happening, the results might well prove disastrous. 

The lie I am referring to is the idea that the financial crisis of 2008, and subsequent “Great Recession,” were caused by profligate government spending and subsequent public debt. The exact opposite is in fact the case. The crash happened because of dangerously high levels of private debt (a mortgage crisis specifically). And - this is the part we are not supposed to talk about—there is an inverse relation between public and private debt levels.

If the public sector reduces its debt, overall private sector debt goes up. That's what happened in the years leading up to 2008. Now austerity is making it happening again. And if we don't do something about it, the results will, inevitably, be another catastrophe.

The winners and losers of debt

These graphs show the relationship between public and private debt. They are both forecasts from the Office for Budget Responsibility, produced in 2015 and 2017. 

This is what the OBR was projecting what would happen around now back in 2015:

This year the OBR completely changed its forecast. This is how it now projects things are likely to turn out:

First, notice how both diagrams are symmetrical. What happens on top (that part of the economy that is in surplus) precisely mirrors what happens in the bottom (that part of the economy that is in deficit). This is called an “accounting identity.”

As in any ledger sheet, credits and debits have to match. The easiest way to understand this is to imagine there are just two actors, government, and the private sector. If the government borrows £100, and spends it, then the government has a debt of £100. But by spending, it has injected £100 more pounds into the private economy. In other words, -£100 for the government, +£100 for everyone else in the diagram. 

Similarly, if the government taxes someone for £100 , then the government is £100 richer but there’s £100 subtracted from the private economy (+£100 for government, -£100 for everybody else on the diagram).

So what implications does this kind of bookkeeping have for the overall economy? It means that if the government goes into surplus, then everyone else has to go into debt.

We tend to think of money as if it is a bunch of poker chips already lying around, but that’s not how it really works. Money has to be created. And money is created when banks make loans. Either the government borrows money and injects it into the economy, or private citizens borrow money from banks. Those banks don’t take the money from people’s savings or anywhere else, they just make it up. Anyone can write an IOU. But only banks are allowed to issue IOUs that the government will accept in payment for taxes. (In other words, there actually is a magic money tree. But only banks are allowed to use it.)

There are other factors. The UK has a huge trade deficit (blue), and that means the government (yellow) also has to run a deficit (print money, or more accurately, get banks to do it) to inject into the economy to pay for all those Chinese trainers, American iPads, and German cars. The total amount of money can also fluctuate. But the real point here is, the less the government is in debt, the more everyone else must be. Austerity measures will necessarily lead to rising levels of private debt. And this is exactly what has happened.

Now, if this seems to have very little to do with the way politicians talk about such matters, there's a simple reason: most politicians don’t actually know any of this. A recent survey showed 90 per cent of MPs don't even understand where money comes from (they think it's issued by the Royal Mint). In reality, debt is money. If no one owed anyone anything at all there would be no money and the economy would grind to a halt.

But of course debt has to be owed to someone. These charts show who owes what to whom.

The crisis in private debt

Bearing all this in mind, let's look at those diagrams again - keeping our eye particularly on the dark blue that represents household debt. In the first, 2015 version, the OBR duly noted that there was a substantial build-up of household debt in the years leading up to the crash of 2008. This is significant because it was the first time in British history that total household debts were higher than total household savings, and therefore the household sector itself was in deficit territory. (Corporations, at the same time, were raking in enormous profits.) But it also predicted this wouldn't happen again.

True, the OBR observed, austerity and the reduction of government deficits meant private debt levels would have to go up. However, the OBR economists insisted this wouldn't be a problem because the burden would fall not on households but on corporations. Business-friendly Tory policies would, they insisted, inspire a boom in corporate expansion, which would mean frenzied corporate borrowing (that huge red bulge below the line in the first diagram, which was supposed to eventually replace government deficits entirely). Ordinary households would have little or nothing to worry about.

This was total fantasy. No such frenzied boom took place.

In the second diagram, two years later, the OBR is forced to acknowledge this. Corporations are just raking in the profits and sitting on them. The household sector, on the other hand, is a rolling catastrophe. Austerity has meant falling wages, less government spending on social services (or anything else), and higher de facto taxes. This puts the squeeze on household budgets and people are forced to borrow. As a result, not only are households in overall deficit for the second time in British history, the situation is actually worse than it was in the years leading up to 2008.

And remember: it was a mortgage crisis that set off the 2008 crash, which almost destroyed the world economy and plunged millions into penury. Not a crisis in public debt. A crisis in private debt.

An inquiry

In 2015, around the time the original OBR predictions came out, I wrote an essay in the Guardian predicting that austerity and budget-balancing would create a disastrous crisis in private debt. Now it's so clearly, unmistakably, happening that even the OBR cannot deny it.

I believe the time has come for there be a public investigation - a formal public inquiry, in fact - into how this could be allowed to happen. After the 2008 crash, at least the economists in Treasury and the Bank of England could plausibly claim they hadn't completely understood the relation between private debt and financial instability. Now they simply have no excuse.

What on earth is an institution called the “Office for Budget Responsibility” credulously imagining corporate borrowing binges in order to suggest the government will balance the budget to no ill effects? How responsible is that? Even the second chart is extremely odd. Up to 2017, the top and bottom of the diagram are exact mirrors of one another, as they ought to be. However, in the projected future after 2017, the section below the line is much smaller than the section above, apparently seriously understating the amount both of future government, and future private, debt. In other words, the numbers don't add up.

The OBR told the New Statesman ​that it was not aware of any errors in its 2015 forecast for corporate sector net lending, and that the forecast was based on the available data. It said the forecast for business investment has been revised down because of the uncertainty created by Brexit. 

Still, if the “Office of Budget Responsibility” was true to its name, it should be sounding off the alarm bells right about now. So far all we've got is one mention of private debt and a mild warning about the rise of personal debt from the Bank of England, which did not however connect the problem to austerity, and one fairly strong statement from a maverick columnist in the Daily Mail. Otherwise, silence. 

The only plausible explanation is that institutions like the Treasury, OBR, and to a degree as well the Bank of England can't, by definition, warn against the dangers of austerity, however alarming the situation, because they have been set up the way they have in order to justify austerity. It's important to emphasise that most professional economists have never supported Conservative policies in this regard. The policy was adopted because it was convenient to politicians; institutions were set up in order to support it; economists were hired in order to come up with arguments for austerity, rather than to judge whether it would be a good idea. At present, this situation has led us to the brink of disaster.

The last time there was a financial crash, the Queen famously asked: why was no one able to foresee this? We now have the tools. Perhaps the most important task for a public inquiry will be to finally ask: what is the real purpose of the institutions that are supposed to foresee such matters, to what degree have they been politicised, and what would it take to turn them back into institutions that can at least inform us if we're staring into the lights of an oncoming train?