The Bank of England’s
response to Britain’s credit crunch is to lend £50,000,000,000 to its friends,
the big commercial banks.
No one has suggested
lending that sort of money to small business rather than big banks.
If they did, it would
be like a shot of adrenaline into the heart of the economy. If the nation’s
entrepreneurs had fifty thousand million in their pockets tomorrow, a
proportion might be lost on bad ventures, but far more would be spent on
expanding business to make Britain the most dynamic economy in the world.
Of course, even if
government were to do such a thing, being government, it would spoil the effect
by distributing it through grants and loans, which are notoriously inefficient with political interference.
Far better to have a one-off
rebate on business taxes for a year. The
country with the courage and the imagination to do that need have no fear of
recession.