Lez Miserable: "Ooh, look at that one - it's got veins!"

Meet our new columnist, Eleanor Margolis, as she takes a frank, funny and cynical tour through life as a twentysomething lesbian. In her first piece, her vibrator bites the dust, and her mother is keen to help her replace it.

It’s morning. I’m having my "early 20s English lit graduate, existential ennui-stricken lesbian, post-sleep nap". All of a sudden, the puppies licking my face in my dream scarper. They’re being chased off by something that I can only describe as part-werewolf, part-blender. I sit bolt upright in bed. I’ve been woken by a loud rattling sound coming from my chest of drawers.

I freeze. I recently watched Paranormal Activity. I know how this goes.

After about 30 seconds frozen to the spot, my mouth slightly open and my heart pounding, I summon up the courage to investigate. I sneak up to my chest of drawers, empty Mini Cheddars packets crunching under my feet, and tentatively open the “haunted” drawer.

Relief. No lurking satanic spirit here. Just my vibrator that has somehow managed to switch itself on. I pick it up, study it for a few seconds, then switch it off. I try to switch it on again. Nothing. I replace the battery – number one rule of being single: always have spare batteries. Still no sign of life.

And then it hits me – I’ve bored my vibrator into an early grave. Was that final buzz in fact a death rattle? I only ever used it on one setting – continuous vibrate. All the other vibration patterns just seemed a bit… Edwina Currie.

So this is where I’m at, sex-wise. I can’t even keep my vibrator interested. I may be the first woman in history to have hit ‘lesbian bed death’ without the remotest sign of lesbian bed life.

Something must be done. First things first, I’m going to need a new vibrator. I Google “buy sex toys”, which is now tattooed onto my search history alongside, “diabetes symptoms”, “dealing with neurosis” and “is nipple hair normal?”

The selection is overwhelming. My old vibrator was fairly basic – a longish thing that, up until a few moments ago, went bzzz. The new, sexually adventurous me wants something fancier. Rabbits seem a bit 90s and all these double-penetration gizmos with twirly bits coming out in every direction just aren’t very… me.

“Ooh, look at that one – it’s got veins!

My mum has snuck up behind me (one of the many hazards of having moved back in with my parents). She’s peering over my shoulder, squinting slightly because she doesn’t have her reading glasses on. Horrified, I slam my laptop shut.

“The problem with your generation,” she says, “Is you think you invented sex.” And off she trots to make a cup of Lady Grey.

Back to my search. I remember Fab, the online eclectic cool stuff shop, does a line in masturbation-chic. I got an email about it a while ago, back when me and the old vibrator were going strong. I check out what Fab has to offer and come face to face with the battery-operated companion of my dreams. It looks like an Alessi peppermill, perfectly combining two of my greatest loves: design and having orgasms. A few clicks later, it’s mine.

But this isn’t enough to cure my case of the borings. Must buy more sex toys. Must be exciting. I’ve never owned a strap-on, but suddenly feel that I need one. Immediately. Maybe I’ll start carrying it around in my bag, just in case. I browse through various online sex shops, and end up spending £50 on a high-end strap-on. I reason that I should get something sturdy. I remember an old Jewish saying that my mum likes to quote when justifying spending £500 on a toaster: “What’s cheap is dear.”

The next day I’m woken up by more vibrating. This time it’s just my phone. I pick up and grunt something.

“Hello, is that Ms Margolis?”

“Yeah…”

“My name is Andy, I’m calling from Barclays, regarding some unusual activity on your debit card”.

Shit.

“Oh…”

Andy takes me through some security questions. I know exactly what’s coming. And here it is:

“Now, Ms Margolis, I need you to confirm that you recently spent £50 at bedroompleasures.co.uk?”

My free hand is tightly clamped to my face.

“Uh, yeah. I may have done that”.

“Are you certain, Ms Margolis?”

“Yes. That is a thing that I definitely did.”

“OK, Ms Margolis. I’m going to unblock your card immediately. I’m very sorry for any inconvenience.”

So, the moment I step out of my sandwiches, clothes and Superdrug own-brand ibuprofen bubble of spending drudgery, alarms go off. It’s like the bank knows that I never get laid. It assumes that someone sexy and exciting must have stolen my card. Time to face it, Ms Margolis: you’re staid.

I thank Andy and hang up. I spend a few minutes screaming into my pillow.

Eleanor Margolis is a freelance journalist, whose column "Lez Miserable" will appear weekly on the New Statesman website. She tweets @eleanormargolis

A cart full of sex toys. Photo: Getty

Eleanor Margolis is a freelance journalist, whose "Lez Miserable" column appears weekly on the New Statesman website.

Getty
Show Hide image

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?