like china and a part of this is to do with moving to net zero. everyone in the world has decided that gas is their. transitional fuel to - get there, at the same time, and that means that everyone is going, - there is a dash for gas. this is absolutely crucial, - lots of countries which rely on gas to make electricity are seeing this, the government here is under- enormous pressure to try and figure out what to do about this. there have been different measures, france, i think they have been- giving out 100 euros tokens - and in spain they have removed vat. all of these options - are out there, including some sort of bailout for the industry to try and smooth i the spike over time, but i think actually this is in many ways more of a political emergency and an i international one, because it is not unconnected to what is going on in| ukraine or certainly the things that people are talking about is not - unconnected to the relationship with russia at this time and perhaps we i can d
here is under enormous pressure to try and figure out what to do about this. there have been different measures in france, - i think they have been giving out 100 euros tokens - and in spain they have removed vat. - all of these options are out there, including some sortl of bailout for the industry . to try and smooth the spike over time, but i think actually this is in many ways more - of a political emergency. and an international one, because it is not unconnected to what is going on in ukraine or certainly the things i that people are talking about are not unconnected - to the relationship with russia at this time and perhaps we can discuss that. - this is a really, really- serious issue at the moment. we will discuss that in a minute. good idea. marc, you are an economist. what levers exist that allow government to, in some ways, mitigate the effects of inflation and is there any sign that they work these days? because a lot of people say, interest rates are so low, that you
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there, including some sorti of bailout for the industry . to try and smooth the spike over time, but i think actually this is in many ways more - of a political emergency. and an international one, because it is not unconnected to what is going on in ukraine or certainly the things that - people are talking about is not unconnected to the relationship with russia at this time and - perhaps we can discuss that. this is a really, really- serious issue at the moment. we will discuss that in a minute. marc, you are an economist, what levers exist that allow government to, in some ways, mitigate the effects of inflation and is there any sign that they work these days, because a lot of people say, interest rates are so low, that you can incrementally raise them, but it has very little effect in dampening inflation? well, government has limited room of manoeuvre, as simon said, because they can give a bit of money, they can put taxes on the winners in covid, like pharmaceutical companies, lik
like pharmaceutical companies, like a windfall tax, on utilities and food companies like supermarkets, but that won t help. it might help short term, but really france giving 100 euros, you should give £500 or £1000. who knows? i think the only solution, in a way, is the central bank, because the central bank is really responsible also of the inflationary mess that we are in because they undervalue inflation. they continue to print money because they want to support the relaunch of plans and it came too late, by increasing interest rates. interest rates are the only thing that will work, if you increase them drastically, which is very difficult politically, so what you need is a real interest rate increase, not 0.1% or 0.25%, but something like 1 2%, alleviated by short term help from the government.