Bad Medicine

Page two of the Guardian today was an advert from British Gas to explain why it was "good for our customers" they increased profits by 24 percent to £724m.

Pointless supporting statistics included the £700m paid by their employees in tax which translated into English means " we employ a lot of people and like everyone else they pay tax on their income." Hardly a boast.

But there is a wider problem than the mere profiteering during a recession and a hard winter. Fuel prices are feeding inflation which means interest rates are bound to rise in the near future. Other inflationary pressures are coming from food where speculators have found a whole new market to play with.

A raise in interest rates would be corrective action to dissaude over-spending. However gas, petrol and potataoes are not luxuries we can easily dispense with. Spending in these areas would be largely unaffected if rates went up one, two or three points. But households' disposable incomes would be severely hit and would drive the economy faster and deeper back into recession.

Osbourne as Chancellor has a strong 'laissez-faire' instinct and would not seek to rein in the capitalist zeal of complanies like British Gas. In fact immediately prior to the big crash he was calling on banking regulation to be cut. But it is the irresponsible profiteers of industry and the City which is driving the economy into the ditch and George is just letting them do it.