Many theories have been consistent right the way through the 18-month period of lockdowns that have been imposed on the British public, and one that is particularly interesting is the line of thinking that lockdowns serve to make smaller businesses non-viable whilst bolstering the performance of large corporations and public sector leviathans.
In its previous iterations, Conservative government policy has often centered around advocacy of free enterprise rather than government ownership of business, however the reality is that many politicians have interests in large companies and are sponsored by them and have an interest in public sector organizations which can be controlled by the state.
Therefore, the tiny window of North American-style entrepreneurism and support for small businesses has really been confined to the 1980s under Margaret Thatcher, herself the daughter of a small businessman who owned a convenience store in a small East Midlands town.
If there is any weight to these suppositions, today's market certainly echoes the division between the performance of the top performing big corporations in the United Kingdom and the small businesses.
The FTSE 100 has been on an absolute roll for at least two months now, and has remained above 7,000 points constantly, whilst small businesses across the United Kingdom are now banding together to lobby the government for more financial support as they face tremendous hardships as a result of enforced lockdowns.
This shows that certain large corporations have been making hay whilst the independent retailers and small family-owned businesses struggle to survive.
The FTSE 100 is down considerably today compared to yesterday, with a surprising 46.09 point drop this morning, meaning that over the past 5 days the FTSE 100 index has dropped by 33.27 points, but it is still at a high point when looking at its performance over the past 5 years.
Indeed, it is some 477.74 points above its pre-Brexit, pre-lockdown 2016 levels, which is astonishing progress considering the ever-changing business climate.
With regard to Brexit, it was always clear that more firms would invest in British businesses, and that some large companies would move their business to the United Kingdom or buy into big British firms, but with lockdowns, many FTSE 100 listed consultancies, pharmaceutical firms and companies with rock-solid government contracts have had their backs scratched very extensively by politicians.
This is known as 'corporate socialism' and it is very much a factor within the British elite. It is, in short, a type of economic policy that takes from the people and gives to corporations.
In May last year, just two months into the lockdowns that were forced upon the businesses of the nation and disobeyed by those who instructed others to abide by them, figures from the Office for National Statistics (ONS) showed the cost to the public purse of the various measures introduced by the Johnson government would amount to at least £110 billion over the next year.
They comprised of huge grants to large corporations in the form of £49 billion or more in wage subsidies paid to companies who furlough workers, most of whom only receive 80 percent of their usual pay, and £16 billion for additional day-to-day spending on public services.
Smaller businesses by comparison have been encouraged to take out loans instead, which are backed by the government but are fully repayable.
Many small businesses in the United Kingdom are in the hospitality sector, and today, industry leaders said more than 200,000 jobs were still at risk. The delay to the end of lockdown looks set to cost the economy £4 billion in lost spending, with the hospitality industry taking a £3 billion hit.
Interest payments on Britain’s £2.2 trillion national debt pile could rise to a post-war high if inflation surges out of control, a major international banking body has warned.
The Government could end up forking out around £100 billion every year on servicing its debt, the Bank for International Settlements (BIS) indicated in its annual economic report, if interest rates were increased to ‘levels in the mid-1990s’ to combat rising inflation.
Currently, the UK is spending around £45 billion a year on interest, after borrowing spiralled last year to cover the costs of the lockdowns.
Despite this the hospitality sector faces a £92 million business rates bill in July, and will be asked to contribute to the cost of furloughing staff.
If this is accurate, the FTSE 100 blue chip companies are absolutely bolstered and almost too big to fail, whilst the wider economy falters under huge debt, and small business becomes increasingly non-viable.