Funding the Future

The Democrats have won an extraordinary victory in America’s midterm elections. But will they really change the USA, or will corporate power, billionaire influence and neoliberalism continue to dominate US politics?
Winning elections is not the same as changing the political system. That is the central question I explore in this video.
The Democrats now have an opportunity to challenge Donald Trump and the political establishment that has allowed corporate interests to dominate American democracy for decades. But will they take it?
Newly elected politicians such as James Talarico offer genuine hope. His challenge to billionaire influence, including Elon Musk’s enormous financial intervention in Texas, suggests that a different politics might be possible.
But hope is not enough. America’s political system remains dominated by wealthy donors, corporate lobbying, monopolies, and the consequences of the Citizens United election-funding ruling. And many Democrats remain deeply embedded in that system.
I argue that the Democrats face a fundamental choice. They can manage the existing system, or they can transform it.
That would mean challenging corporate power, reforming campaign finance, tackling monopolies, confronting political corruption and replacing neoliberalism with a politics of care.
The next two years will determine whether the Democrats have the courage to make that choice before the 2028 Presidential election.
The question is, will they change America, or merely govern it under the existing rules?

Why does work matter? And why does our economy so often fail to recognise the value of what people do?
In this episode of Understanding Economics, I explain why work is the foundation of our economy, why it matters to everyone, and why the rewards from it are so unfairly shared.
Without people working, nothing happens. Businesses cannot function, public services cannot operate, and the care that makes our lives possible would not exist. Money and machines cannot replace the contribution people make.
But not all work is paid. Millions of people care for children, support relatives, run homes and volunteer without receiving wages. Much of this work is undertaken by women, and conventional economics has largely ignored its significance.
Meanwhile, those in paid employment often lack the power to secure a fair share of the wealth they create. Employers have advantages that workers do not, which is why trade unions and employment rights matter.
I also explain why unemployment is an economic and social waste. When governments choose policies that leave people without work, they waste something that can never be recovered: people’s time and abilities.
Work should make life better for everyone, not simply generate profits for a few.
A successful economy must value all useful work, reward it fairly and give everyone the opportunity to contribute.

The four horsemen of the apocalypse were traditionally conquest, war, famine and death. But what if the greatest threats to our modern world are now something very different?
I suggest that four interconnected forces are destroying our societies from within: patriarchy, colonialism, neoliberalism and individualism.
These are not simply political ideas. They are systems of power that shape our economies, undermine democracy, concentrate wealth, encourage exploitation and destroy the relationships on which human well-being depends.
Patriarchy establishes hierarchies of power. Colonialism extracts wealth from those who have less. Neoliberalism puts markets before people. Individualism denies our dependence upon each other.
Together, they threaten our collective future.
And conventional economics has helped make this possible by treating people as isolated individuals competing against each other, rather than recognising the relationships that make economic and social life possible.
In this video, I explain why these four horsemen matter, how they reinforce each other, and why the crises facing our societies are not inevitable.
We can choose equality instead of domination, cooperation instead of exploitation, and an economy that serves society rather than governing it.
The apocalypse is a political choice. So is creating a better future.

Why does the UK government sell bonds? Does it really need to borrow money before it can spend? And do government bonds actually increase the national debt?
In this episode of Understanding Economics, I explain why government bonds are not what most politicians and financial commentators claim them to be.
The UK government issues its own currency through the Bank of England. When it spends, money enters the economy, and when it taxes, money is removed.
When government spending exceeds taxation, the money left in the economy becomes available for households, businesses and financial institutions to save.
Government bonds, also known as gilts, are essentially government-backed savings accounts. They allow investors to exchange money they already hold for a financial asset that pays interest.
This is the crucial point: selling a government bond does not, by itself, create additional government financial liabilities. It exchanges one form of government debt for another.
So why does the government issue bonds?
I explain how bonds provide relatively safe savings opportunities for pension funds, banks and other investors, while also helping influence interest rates throughout the economy.
I also examine the role of the Bank of England, commercial bank reserves and the difference between variable interest rates and the fixed or inflation-linked returns offered by government bonds.
Most importantly, I challenge the assumption that the government must borrow from financial markets to fund its spending.
I argue that government bond issuance is an economic policy choice, not an unavoidable requirement for financing public expenditure.
The real limits on government spending are the availability of workers, materials and productive resources, alongside the need to manage inflation.
Understanding this changes how we think about government borrowing, the national debt and the supposed power of bond markets.
The government should be making economic decisions in the public interest, not simply to satisfy financial markets.

Could artificial intelligence trigger another Great Depression? And could the very success of AI cause the next global financial crash?
AI investment is booming, technology companies have extraordinary valuations, and financial markets are betting on enormous future profits. But what happens if those profits never materialise?
In this video, I explore an argument made by American economist Professor James Galbraith, whose interpretation of the Wall Street Crash of 1929 offers a disturbing warning about today’s economy.
Galbraith argues that the discovery of cheap American oil undermined the profitability of industries built around coal, steam and railways. Technological progress offered enormous opportunities, but destroyed the financial expectations underpinning the existing economy. The resulting financial crisis prevented investment in the new infrastructure required.
Could AI create a similar crisis?
American technology companies are investing hundreds of billions in AI. Their valuations depend on enormous future profits. But what if China develops better AI at a fraction of the cost?
American investments could become worthless. Share prices could collapse, pension funds and banks could suffer enormous losses, and financial instability could spread worldwide.
AI could succeed technologically while causing financial disaster.
This exposes the dangers of shareholder value and financial markets that prioritise speculative profits over economic progress.
I explain why Roosevelt’s New Deal, which dragged the USA out of the 1929 crash, offers lessons for today. Government investment helped America make the transition to an oil-based economy. Similar public intervention may now be essential to ensure AI benefits everyone.
The internet survived the dot-com crash. AI could survive another financial crisis. But could the global economy?
Galbraith’s warning is that governments must act before another crash, not afterwards. The question is, will they?

America has rejected Donald Trump at the midterm elections. The Democrats have won control of Congress, but the economic crisis facing the United States is far from over.
In fact, it could be about to get considerably worse.
American financial markets are heavily dependent on the extraordinary valuations of artificial intelligence companies. Billions have been invested in an AI boom whose economic benefits remain uncertain.
If that bubble bursts, the consequences could extend far beyond Silicon Valley.
Pension funds, banks, financial markets and economies around the world are exposed to what happens in America. Britain is no exception.
The problem is that the United States now faces the prospect of political paralysis. Trump remains president, with substantial executive powers, while Democrats control Congress.
What happens if a financial crisis develops and the American government cannot agree on how to respond?
And what happens when neither political party offers a convincing alternative to the neoliberal economic policies that have created so much inequality and insecurity?
In this video, I explain why Trump’s defeat is not necessarily a victory for ordinary Americans, why the AI bubble matters, and why political change without economic change may achieve very little.
America needs a new economic direction.
The question is whether its political system can deliver one before another crisis arrives.

Are we at a tipping point? Could the growing wave of protests around the world signal the beginning of the end of neoliberalism and the emergence of a fundamentally different political and economic system?
For more than 40 years, neoliberalism has dominated political and economic policy. It has promised prosperity, opportunity and freedom. But inequality has increased, housing has become unaffordable, public services have deteriorated, and economic insecurity has grown.
Now people are demanding change.
Across Europe and beyond, protests are challenging the political and economic status quo. Young people, particularly Generation Z, are at the forefront. Their demands vary, but the underlying frustration is remarkably similar: the existing system is failing to meet their needs.
In this video, I ask whether these protests could represent a tipping point, when accumulated dissatisfaction finally produces fundamental political change.
I consider the research of Harvard professor Erica Chenoweth into how relatively small movements can achieve extraordinary results.
Then, I explore why changing governments may not be enough when the economic assumptions underpinning their policies remain unchanged.
But there is another question. If neoliberalism is approaching its end, what replaces it?
Rejecting the existing system is not enough. We need a credible alternative.
I argue that this must involve an economics of hope and a politics of care, putting people, democracy and collective well-being before the demands of markets.
So, are we witnessing a historic turning point, or merely the beginning of a much longer struggle for change? Time will tell.

Britain is supposedly facing a welfare spending crisis. Politicians, newspapers and television commentators are demanding cuts to benefits because they claim that the country can no longer afford its social security system.
But what if the crisis they describe does not actually exist?
In this video, I examine the UK government’s own figures for social security spending since World War II. They tell a very different story from the one we are being sold.
Yes, spending has increased in cash terms. But inflation explains much of that apparent increase. And, when we compare social security spending with GDP and total government expenditure, the supposed crisis largely disappears. Nothing justifies the claims that spending is now heading out of control.
The biggest long-term increase has been in state pensions, but that simply reflects a growing and ageing population. We always knew that would happen.
Meanwhile, support for unemployed people, children and low-income families has been squeezed. And whilst disability and sickness payments have increased, the figures need to be understood in their historical and economic context.
So why are politicians demanding further cuts?
I argue that this is not really about controlling spending. It is about scapegoating people who need support, while refusing to acknowledge the failures of an economy that increasingly excludes those who cannot fit its demands.
This is an economic argument by those who make it, but it is also a profoundly moral one.
My argumemnt is that we should be asking how to provide everyone with dignity and security, and not how to make vulnerable people poorer. If we have a crisis, it is because too many people just do not care. That is the issue we really need to face.

What happens when the government spends money? Most politicians talk about public spending as though it is simply a cost. But government spending does something much more important: it creates income, supports jobs and generates additional economic activity.
In this Understanding Economics video, I explain the multiplier effect, one of the most important concepts in economics, and why understanding it fundamentally changes how we should think about government spending, taxation and austerity.
The multiplier effect describes how an initial amount of spending generates additional income as money circulates through the economy.
Imagine the government pays a builder £100. The builder pays £30 in tax and spends the remaining £70 in local shops. Those shops now have additional income, which they can use to pay employees, purchase supplies and pay their own taxes.
The money continues circulating, creating further income and economic activity.
If the government’s original £100 of spending generates £200 of additional income, the multiplier is two. If it generates £300, the multiplier is three.
And here’s the important point: government spending can generate enough additional tax revenue to recover its original cost.
I explain why some forms of government expenditure have much greater multiplier effects than others.
Spending on the NHS, public services and productive investment can generate substantial additional economic activity. Defence spending, by contrast, may have a much smaller multiplier effect.
This means that government spending decisions should be judged by the economic and social benefits they create, not simply by their initial cost.
I also examine what happens when governments cut spending. The multiplier effect works in reverse. Cutting public expenditure reduces someone’s income, which reduces their spending, which then reduces income elsewhere in the economy.
This helps explain why austerity can damage economic growth, destroy jobs and reduce government tax revenue.
But the multiplier effect has limits.
Saving money rather than spending it can reduce the multiplier effect. Spending on imports can also reduce the amount of money circulating domestically.
And when the economy reaches the limits of its productive capacity, additional spending may create inflation rather than additional output.
Understanding these relationships is essential to understanding how the economy really works.
I argue that politicians must stop treating government spending as money disappearing into a black hole.
Public spending creates income. That income supports businesses, employment and tax revenues. And in many circumstances, the economic benefits can be significantly greater than the government’s original expenditure.
The question should not simply be how much government spending costs. It should be what that spending achieves.
That is why the multiplier effect matters, and why it is central to understanding economics.

How can France be neoliberal when its government spends 57% of GDP and maintains one of Europe’s largest welfare states? With protests taking place across France, many people are asking how a country with such extensive public services can be governed according to neoliberal principles.
The answer is that neoliberalism is not defined by the size of the state. It is defined by whose interests the state serves.
In this video, I explain why a government can spend enormous amounts of public money while still pursuing policies that benefit financial markets, private corporations and wealthy investors.
France provides a particularly revealing example.
French government spending accounts for approximately 57% of GDP, compared with around 46% in the UK. Yet this does not mean that France has escaped neoliberalism.
The real question is who controls economic decisions and who benefits from public spending.
Financial markets, bond investors and European Union fiscal rules all heavily influence French economic policy. These pressures push French governments to prioritise financial credibility and spending restraint over citizens' needs.
That explains why austerity remains a major political issue in France despite the country’s substantial welfare state.
Cuts affecting pensions, education and other public services are being challenged by protesters who believe that ordinary people are being made to pay the price for policies designed to reassure financial interests.
But there is another important dimension to modern neoliberalism.
Privatisation and outsourcing allow private companies to profit from public spending. Governments continue to collect taxes and fund essential services, but increasing amounts of that money can flow into private businesses through contracts and the transfer of public assets.
The state does not necessarily become smaller. Instead, its resources are increasingly directed towards private financial interests.
This is now one of the defining characteristics of modern neoliberalism, and it is something we can also see in the UK.
The French protests therefore raise a fundamental democratic question: should elected governments serve their citizens or financial markets?
Economic policy is about political choices, not simply financial constraints, and France demonstrates that a large government is not necessarily an alternative to neoliberalism. What matters is whether public resources are used to improve people’s lives or generate private profits.
If we want an economy that serves society, we must challenge the growing influence of private wealth over public spending.