Our banks aren't lending to the real economy. Maybe Corbyn’s QE and National Investment Bank will

KJ get's there in the end, with help from Fee and Chris...

SOURCE TELEGRAPH: Five good things about Corbyn (even if you're not a Labour supporter)

Did you ever wonder why the banks and the City (who caused the great recession) were also the largest beneficiaries of re-inflating the economy with quantitative easing? And did you not perhaps feel a little aggrieved that, once they’d got what they wanted, they carried on as if nothing had happened, displayed no gratitude whatsoever and changed their ways not a bit? Anyway, history has shown that there is alternative in the form of a massive public works programme. You know, like the New Deal. A response to an economic calamity that benefits everyone, not just the people who caused it. Imagine if, instead of a few new towers in the City we had new jobs, new ports, new roads and new railways. Imagine, if instead of austerity, we had government spending. You wouldn’t even need to print money to do it. Rather, governments could borrow it - and at the lowest rates for decades. The Economist recently described the failure of governments to borrow to build as a “missed opportunity”, while Standard & Poor’s reckons that, for every 1% of GDP spent on infrastructure the UK’s economy would grow by 2.5 per cent.

SOURCE STANDARD & POOR'S: Global Infrastructure Investment: Timing Is Everything (And Now Is The Time)

Standard & Poor’s sees clear economic benefits to G20 countries’ increased public spending on infrastructure–with the so-called “multiplier effect” of an increase in spending of 1% of real GDP running as high as 2.5 in a three-year period. The multiplier effect is generally greater in developing economies than for more developed countries; for example, China, India, and Brazil would all enjoy a boost to GDP of at least double the increase in investment. For Europe, it’s clear that a concerted effort across the region would have a greater effect than country-specific increases in spending. For developed nations, the increase would boost employment substantially–adding more than 700,000 jobs in the U.S. and about a million in the EU. In addition to the short-term boost to jobs and aggregate demand, infrastructure investment often yields long-term benefits by enhancing efficiency.

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