Wednesday, 23 May 2012

Culture in the UK needs to change for new age of Austerity

There has been a definite change in the Social approach to Austerity and personal finance over the last century.

Really Chris in a whole century? Through changing times of War and prosperity as well as vast social upheaval and change?

Well yes, obviously things have changed but if you scratch away at the surface the same pressures that threatened our Great-great Grandparents are the same as today yet approaches have changed.

A level of greed and a "Something for nothing" culture have developed as more people believe that they the state will, and should, help them out.

An acceptance of the Nanny state and having everything done for them has led to people not being able to do things for themselves.

For example if a child is failing at School parents are quick to point at the school and ask what they are doing rather than asking what, if anything, can be done at home to help.

Capitalism and mass marketing has affected us all and the need for bigger and shinier stuff has lead to more of our disposable income being spent on "Luxury" items. Who really needs the new Garbage album? Or Diablo III? or War Horse on DVD?

We all know what kids are like at Christmas and Toy manufacturers have perfected their technique for for appealing to kids and parents find themselves caught by the dreaded "I wants" - believe me in four years I'm going to have my children striking me and I shall join the vast hordes of people who become indebted at Christmas.There is also Social pressure to have the "Latest thing" and not just in kids, my wife had wanted an I-phone for well over a year and kept trying to figure out where to get the money or contract.

 Banks ceased to be interested in your balance and more in the Customer's situation. Earlier in the week it was reported that one person who wrote into the Citizens advice bureau in Medway had over 60 credit cards! One load was got out to pay another loan and the debt is just moved around. It seemed that in the mid to late 90's the credit card became more and more prolific. Banks, or at least my bank, began pushing them, adverts fell out of magazines, adverts on TV with Rowan Atkinson and the message was;

"Buy now, pay later. - You can even spread the payments over time!"

The boom years brought economy air travel too so you could go clubbing in Ibiza for an affordable amount and pay it back slowly.

Obviously debt is not all self inflicted and situations and life can throw you a curve ball. Students studying for their finals and not able to work, long term illness, house repairs or even death within the family but they result in the same, though there is no blame and these are the people the Welfare state is meant to help. Too many people are relying on the state to pay out, true the Welfare state is there as a safety net to help those who fall and in need of assistance but it seems that more people are jumping off the cliff on purpose. These may sound like sweeping generalisations but how many people have quit their job and signed on just because they don't like their job? How many people keep having Children just for the increase in Child benefits?

I always thought Liberalism was about freedom of action from state interference and a strong belief in people being able to make their own decisions. Well we're all adults and we have to make adult decisions in life and that means sacrifices. No, I can't afford to buy Skyrim for £44 this month, I can't afford that holiday to Prague next year unless I save up and make sacrifices, our family budget cannot stretch to another child so we won't try to have another one.

The problem is debt spirals and you only need a wild month and you're up a famous creek without any oars.

Society and culture was more geared for living in the "here and now" rather than worrying about the future as the use of credit cards meant you could defer. Our parents and Grand parents who'd lived through real austerity in the 30's and 50's were a bit more sensible and stowed money away for a rainy day or leaner times. Haggling was much more common  and both my Grandfathers had a keen eye for a bargain and banter with shop owners. War time tips for making things last have long been forgotten. When was the last time you heard of someone darning a sock?
Make do and mend is a term lost to the mists of time as are the war on waste. Yes I realise that there are no longer U-boats sinking grain convoys and bread is fairly ubiquitous and cheap but pennys add up so why waste things?

Years ago we all knew our neighbours and cooperatives would help each other out. For example my Great-grandfather used to breed rabbits so during the leaner times he would trade rabbit meat for vegetables from one of the his neighbours. There were also occasions when trades would be shared for favours or discount. Now it seems we all hide behind the drawbridge of our own little castles and watch suspiciously over the ramparts. Community has died out in larger cities and towns for a lot of people and there isn't the help there was.

A new approach to Austerity needs to be taken and in some places has already begun. When I was at school the kid whose parents dressed them up in Charity shop clothes usually bore the brunt of many cruel jokes. I, a mouthy somewhat arrogant ginger kid took enough flak as it was but it was made worse by the market bought tracksuits and the lack of "named brand" trainers. There was also only a small spattering of charity shops on high streets and in towns with the charity bookshop doing very well in university towns where students could sell on their old tomes.
Now charity shops have become more and more prevalent, especially in towns like Gillingham where other larger shops can not find a market or sustain themselves. People like my family go in and pick up good quality children's clothing for our daughter, who is at the age where she grows out of things really quickly. I can assure you that she is always smartly dressed. My wife has an eye for nice clothes and we have saved a small fortune buying from Cats Protection rather than Mothercare!
We as a nation need to make things last, take better care of things and yes be prepared to mend things rather than throw out and buy new.

Keep in mind; "Can I really afford this? Do I really need this?" and if the answer is no then walk away, you'll find yourself better off in the long run.

The State does, however, need to intervene with banks and legal loan sharks though. The banking industry must again see the public as cash cows and instead see us as people who will need help. Part of this whole crash was due to over lending to people who just couldn't pay it back. Why would you keep loaning money to someone who is £43,000 in debt? Sound a ridiculous figure? Well it is in fact the AVERAGE debt of those who have contacted Medway's Citizen's Advice!
As for legal loan sharks, the APR is ridiculous and if you don't pay back in a timely fashion you could find yourself locked in spiralling debt with no way to get out of it. Government needs to cap the level of APR that they can charge so that they can at least be some hope.

Yes Culture has changed over time but there are lessons that we can adapt and adopt that were our Grandparents' to save money and resources. We also need to change our approach to life in that we need to make serious decisions and not keep thinking the state will keep bailing us out - that's not what they are there for. We're all adults and should make adult decisions. However the state must also do its part and support those who do need assistance, the elderly, the sick, those who have suffered tough times and they need to redraw the lines with banks and  legal loan sharks to make try and protect the people form predators.

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