As our living standards fall bankers making a killing from government borrowing‏

There are two reasons why a government should not borrow money when it has the power to create its own currency. First it has to pay interest and secondly it has to pay fees to bankers for selling its IOU's called gilts. As much as £67.8m of taxpayer’s money has financed this year's sovereign bond sales, as the government needs to sell billions of pounds' worth of debt to pay for the deficit.

According to data prepared for the Observer by Thomson Reuters, a further £33.7m was paid in merger-and-acquisition and advisory fees, some of which is likely to relate to managing the taxpayer's stakes in banks such as RBS and Lloyds. "It is crazy that the government should be paying this money to the banks that caused the crisis," said Max Lawson, a policy director at Oxfam.

Investment banks have scooped $102m (£64m) in fees this year from Britain's taxpayers for advising the government on bond sales and interventions to stabilise the economy. The British government has emerged as the UK investment banking industry's second-largest customer, paying fees surpassed only by HSBC, which has paid out $174m to fellow banks for help with billions of pounds in debt issuances this year: http://www.guardian.co.uk/business/2010/oct/24/government-investment-banks-second-largest-customer

The government has the power to avoid going into debt it can create its own money and recently the Bank of England created £200bn of positive money and gave it to the banks in exchange for government debt. Government borrowing has started to increase as more people claim benefits and the economy teeters towards recession.

We should be campaigning for the reform of our money supply which would see the right of banks to create money as credit withdrawn and the government would take over the nations money supply. It could then start paying down the debt without cuts in jobs and services. To find out more go here http://www.bankofenglandact.co.uk/