Rampant inflation breaks the status quo – no wonder the government is spooked
When a government pinches a key opposition policy it has spent months deriding, and which goes directly against its ideology, you know something pretty big is going on. The Tories’ screeching U-turn over a windfall tax on energy companies in order to fund payments to “ease” the cost of living crisis is in part a typically crude attempt to change the subject from Partygate. But it is also a more revealing signal: that the government has, belatedly, become very worried about the politics of inflation.
It is right to be. For a lot of voters, many of them Tories, high inflation is very frightening. Savings shrivel. Pay rises are rarely enough. Investing safely seems impossible. State benefits are even less sufficient than usual. Luxuries, small treats and even essentials become unaffordable. The whole process of personal enrichment promised by capitalism goes into reverse. The solidity of money – the basis for so much of our lives – is revealed as an illusion. It becomes clear that money can decay, like everything else.
High inflation makes people angry. The last time Britain had a sustained period of it, from the early 1970s to the early 1980s, rightwing politicians, commentators and voters often described it as a disease, and claimed it was caused by trade unionists’ greed and the profligacy of Labour governments. It was seen as a sign of decadence, which might lead to a national collapse. “Inflation is a great moral evil,” said Geoffrey Howe, Margaret Thatcher’s severe first chancellor, in 1982. “Nations which lose confidence in their currency lose confidence in themselves.”
The UK currently has the worst inflation of any G7 nation. Further huge increases in food and fuel prices are seen as inevitable, such as the £800 rise
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