For further information phone Brighton 685913. These are the myths peddled in rags like The Sun. But when the capitalists talk to themselves, they tell a different story. Mervyn King, Deputy Governor of the Bank of England, let the cat out of the bag. Yet he was speaking the truth - from the perspective of the bankers and businessmen.
Unemployment is useful for lowering wage rates.
When there is a hundred people clamouring for every job then it is easy to refuse wage increases to those in work, or even cut wages. When unemployment is high, the bosses find it easier to impose whatever conditions they want and the labour force has to accept them. Mervyn King is part of the Bank of England's key Monetary Policy Committee. In the last year they have increased interest rates six times. As a consequence of that, unemployment is rising again.