Ronda Rousey hits Liz Carmouche during their 2013 title fight. Photo: Jeff Gross/Getty Images
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Why the UFC is treating its female fighters better than (almost) any other sport

It’s not just the money – Ultimate Fighting Championship has appreciated that women aren’t good fighters considering their gender. They’re simply good fighters.

Ronda Rousey, Olympic bronze medallist, Ultimate Fighting Championship (UFC) bantamweight women’s champion and Pokémon fan, is probably one of the greatest fighters who has ever lived. By way of an example, she finished her last fight in 16 seconds – 16 seconds in which she managed to stun her opponent with a right cross, catch her in a Thai clinch, hit her with a knee, throw her with a flawless harai goshi, and rain down a dozen unanswered punches from a kesa-gatame scarf hold before the referee could step in. Previous title defences have been similar – only one of Rousey’s ten fights has lasted longer than a single five-minute round, and even that outlier ended with her trademark armbar. It’s a string of performances that have led UFC president Dana White to compare her to a prime Mike Tyson, and to CEO Lorenzo Fertitta calling her the “most impressive athlete” in the organisation’s history.

The Ultimate Fighting Championship, the world’s most successful mixed martial arts organisation, is probably not the first place you’d look for gender equality in sport. They still have ring – sorry, *Octagon* – girls, for instance, two of whom have appeared in Playboy. An ad campaign for the twentieth series of the Ultimate Fighter reality series, designed to crown the first strawweight women’s champion, attracted fire for dressing its stars in heels and lipstick, calling them “easy on the eyes and hard on the face” – not an approach that the show has ever taken to male athletes. And, as recently as 2011, UFC president Dana White said that women would “never” fight in the organisation.

But that last part has changed, and fast. A large part of this is down to Rousey, who is a marketing team’s dream – she trains with an intensity that’s rarely seen in the male champs’ behind-the-scenes reels, but happily goofs off with her younger sister between sparring and bagwork. She’s ferocious when she feels slighted – on Twitter and in person – but she’ll happily chat about her love for World of Warcraft and her time as a moderator on a Pokémon forum. She comes out to Joan Jett’s “Bad Reputation”. She popped up in The Expendables 3. She asked pro-wrestler “Rowdy” Roddy Piper for permission to use his nickname, and she calls judo legend Gene LeBell – who supposedly once choked Steven Seagal unconscious – her “uncle”.

But more importantly, at least for the UFC’s core fanbase, she, and the women she fights, are every bit the equal of the men, bringing skills and moves to the Octagon that have never been seen before in the rapidly-evolving sport. Rousey, for instance, uses pure judo more successfully than any other fighter ever has, combining throws in sequences that fans delight in breaking down. When she fought Olympic silver-medal wrestler Sarah McMann (in, incidentally, the sport’s first double-Olympian matchup), it wasn’t enough, and so her style evolved to include some of the most painful-looking body shots ever to feature on a highlight reel. Other matches since the women’s division’s inception have featured roughly the same ratio of terrifying high-amplitude slams, clinical knockouts, dramatic submission holds and technical grinders as those seen elsewhere on the card, to much the same crowd reaction. These women aren’t good fighters considering their gender, the majority of fans understand – they’re simply good fighters.

And so, the UFC have responded – fairly admirably, in fact. Unlike, say, Premier League football, they’ve been using female referees in main events since 2009, and somehow managed to avoid any pundits suggesting that paid professionals might not understand the rules. Unlike in tennis, there’s never been any suggestion that women should fight fewer rounds, or for less time, or with more stringent rules in any other sense. And unlike almost every other sport (apart from possibly athletics) the women get respect, pay and visibility on essentially the same terms as the men. Rousey’s first bout – she was awarded the belt before the fight, after winning a title in another organisation – she headlined the card, above former champions Lyoto Machida and Dan Henderson, and she’s been the main or co-main event ever since. She’s reluctant to discuss her final payouts (which include undisclosed locker-room bonuses and pay-per-view (PPV) points), but her last fight made her at least $120,000, putting her ahead of all but a handful of the organisation’s most PPV-friendly men. The UFC even managed to handle a main event with their first openly gay fighter – former marine Liz Carmouche – more respectfully than virtually any other sport has done to date, interviewing Carmouche’s girlfriend in the pre-fight video after president Dana White praised her courage in coming out and voiced his support for gay marriage.

Yes, a lot of this is down to capitalism. And yes, a lot of it is down to Rousey. But it’s a heartening series of events. Because it suggests that, left to their own devices, the XBone-and-Snapchat generation, despite their worst excesses, can appreciate female athletes for the same reasons as their male counterparts. That sports fans, all over the world, will pay the same money to see them. And that, for a huge amount of people, what really counts is an exciting fight, conducted with breathtaking levels of skill and creative violence. So the only real question is: why aren’t any other sports paying attention?

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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?