The state has no source of money, other than the money people earn themselves. If the state wishes to spend more, it can only do so by borrowing your savings or taxing you more. It is no good thinking that someone else will pay – that ‘someone else’ is you. There is no such thing as public money; there is only taxpayers’ money.
She was wrong of course.
All money is the government’s. The UK government is the sole provider of all of ‘our’ money
What government doesn’t have any of is actually effort and labour – that, it has to hire in and it creates money for that purpose in order that the collective whole can benefit from the mutual and co-operative endeavours that are the result of all of us having to pay tax.
Now if Thatcher had said as she should have, that the government has actually got all the money but has no labour which it has to hire in, that would have been correct.
But the neoliberal financialisation of our society might have been stopped in its tracks.
The deification of her misunderstanding has been Conservative philosophy ever since and I’m pretty certain that subsequent Labour oppositions and indeed governments, were persuaded to believe much the same thing.
Sunak yesterday, delivered an appropriately influenced, complete mess and that, it seems to me, is a summary of why we are in such a shambles.