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Money has its own gravity:when it disappears, it takes everything with it

Nicholas Lezard's "Down and Out" column.

Last night I dreamed that I got paid again. Say it in the cadences of the opening line of Rebecca. It’s a nice dream, one of my favourites, but sometimes I wonder: is it better to have a horrible dream that you are relieved to discover, on waking, was only a dream; or a pleasant one to which reality is an insulting and uncouth rebuke? Anyway, the long-standing non-payment of a significant sum of money is having serious and worrying side effects. There was a letter in last week’s magazine which suggested that I was not literally Down and Out, which is technically true – I’m not shivering under a blanket or selling the Big Issue by Baker Street Station – but when I head along to the cashpoint, as one does, it tells me that my account has insufficient funds for the transaction I’d suggested. I’d wanted to take out £30. Well, I thought, that’s happened a little earlier in the month than I’m accustomed to. Much earlier, in fact.

So that was the end of my evening out. And when you find that you cannot even afford to buy a copy of the Big Issue you think: just how substantial is the difference between the vendor and yourself? Not as much as you’d like, is the answer – which in itself is not a helpful or healthy thought.

Where does the money go? You’d have thought the whores would have dropped their prices in a recession, and I suppose decent cocaine is always going to be a little pricey, and if you can find a drinkable claret for under 50 quid a bottle I will accuse you of poor taste or sharp practice . . . But no, this is not where or how the Lezard money goes. Money has its own gravity, as anyone who has ever played Monopoly knows; when it accrues, nothing can stop it from accruing further, just as when enough rocks in space have smashed together, nothing can stop them from becoming a planet; but when money disappears, it takes everything with it, and scrimping and saving just doesn’t seem to have any effect. This is a phenomenon to which I think the economists have not paid sufficient attention, and may account at least in part for the continuing, mystifying immiseration of this country despite its government’s manifestly sensible policies.

Another interesting facet of this phenomenon is that when the absence of money is caused by the tap-dancing and delaying tactics of a company that ought to behave better, the effect is still the same: virtuous poverty has much the same effect as the kind caused by fecklessness or extravagance. The debts accumulate and you end up having to earn twice as much just to get yourself out of the hole the late payment put you in in the first place. And I have been as busy as a bee lately. It is all most vexing.

The worst thing is the humiliation. You may not feel, as I don’t, that financial health equates to moral wealth – in fact, as I suspect many of this magazine’s readers feel, something almost exactly the opposite seems to be the case – but it doesn’t mean you don’t feel like a lowly spotted thing when times are hard. You can’t buy your girlfriend that lovely thing you saw, you can’t pay in full the money you owe to people who are equally blameless, and the whole business becomes a continuous background noise affecting everything, like tinnitus, which doesn’t even manage to drown out other worries but only contrives to bring them into even sharper relief. When in the company of others who are at least comfortably off, you start playing a kind of Poverty Bingo: when they mention a holiday they’ve had, you think, “Can’t afford that,” when they talk about a nice restaurant they’ve been to, you think, “Be a while before I can afford that,” and you even start wondering whether Zero Dark Thirty will still be in the cinemas before you can go and see what all the fuss is about. (I’ve already given up hope of catching the latest Tarantino for this reason.)

When one is locked into a consumer society, as people of my class and upbringing are, however much one affects to despise consumerism and avoid its seductions, this drip-drip of anxiety leads to shame. I am particularly dismayed about my parents’ reaction to this column when it comes out. So I would like to be able to say that, by the time it appears in print, the company responsible for the status quo in the Lezard coffers will have ceased to drag its feet and I will have some good news at last. And I apologise for the lack of jokes in this week’s column: but I thought I had better explain things to an understandably sceptical correspondent, just so I can put her in the picture. 

Nicholas Lezard is a literary critic for the Guardian and also writes for the Independent. He writes the Down and Out in London column for the New Statesman.

This article first appeared in the 25 February 2013 issue of the New Statesman, The cheap food delusion

Photo: Getty Images
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How can Britain become a nation of homeowners?

David Cameron must unlock the spirit of his postwar predecessors to get the housing market back on track. 

In the 1955 election, Anthony Eden described turning Britain into a “property-owning democracy” as his – and by extension, the Conservative Party’s – overarching mission.

60 years later, what’s changed? Then, as now, an Old Etonian sits in Downing Street. Then, as now, Labour are badly riven between left and right, with their last stay in government widely believed – by their activists at least – to have been a disappointment. Then as now, few commentators seriously believe the Tories will be out of power any time soon.

But as for a property-owning democracy? That’s going less well.

When Eden won in 1955, around a third of people owned their own homes. By the time the Conservative government gave way to Harold Wilson in 1964, 42 per cent of households were owner-occupiers.

That kicked off a long period – from the mid-50s right until the fall of the Berlin Wall – in which home ownership increased, before staying roughly flat at 70 per cent of the population from 1991 to 2001.

But over the course of the next decade, for the first time in over a hundred years, the proportion of owner-occupiers went to into reverse. Just 64 percent of households were owner-occupier in 2011. No-one seriously believes that number will have gone anywhere other than down by the time of the next census in 2021. Most troublingly, in London – which, for the most part, gives us a fairly accurate idea of what the demographics of Britain as a whole will be in 30 years’ time – more than half of households are now renters.

What’s gone wrong?

In short, property prices have shot out of reach of increasing numbers of people. The British housing market increasingly gets a failing grade at “Social Contract 101”: could someone, without a backstop of parental or family capital, entering the workforce today, working full-time, seriously hope to retire in 50 years in their own home with their mortgage paid off?

It’s useful to compare and contrast the policy levers of those two Old Etonians, Eden and Cameron. Cameron, so far, has favoured demand-side solutions: Help to Buy and the new Help to Buy ISA.

To take the second, newer of those two policy innovations first: the Help to Buy ISA. Does it work?

Well, if you are a pre-existing saver – you can’t use the Help to Buy ISA for another tax year. And you have to stop putting money into any existing ISAs. So anyone putting a little aside at the moment – not going to feel the benefit of a Help to Buy ISA.

And anyone solely reliant on a Help to Buy ISA – the most you can benefit from, if you are single, it is an extra three grand from the government. This is not going to shift any houses any time soon.

What it is is a bung for the only working-age demographic to have done well out of the Coalition: dual-earner couples with no children earning above average income.

What about Help to Buy itself? At the margins, Help to Buy is helping some people achieve completions – while driving up the big disincentive to home ownership in the shape of prices – and creating sub-prime style risks for the taxpayer in future.

Eden, in contrast, preferred supply-side policies: his government, like every peacetime government from Baldwin until Thatcher’s it was a housebuilding government.

Why are house prices so high? Because there aren’t enough of them. The sector is over-regulated, underprovided, there isn’t enough housing either for social lets or for buyers. And until today’s Conservatives rediscover the spirit of Eden, that is unlikely to change.

I was at a Conservative party fringe (I was on the far left, both in terms of seating and politics).This is what I said, minus the ums, the ahs, and the moment my screensaver kicked in.

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.