Digging Ourselves Into More Debt

[This article was first posted here on 1st October 2010.]

Here in Great Britain the media have just announced that, according to the Office for National Statistics, Great Britain's national debt has just topped a trillion pounds.

Well, that's strange. The same Office announced nearly 2 years ago that the national debt had just topped TWO trillion pounds.

Someone's obviously got their figures mixed up somewhere, but when you're talking in the trillions it's easy to slip up and miss out a trillion or so. Which is exactly what they more or less admit to having done, for in their report they mention the fact that the real figure is probably between £4 trillion and £5 trillion when you take into account obligations such as public sector pensions and private finance initiatives.

But back to the main point, which is that the new coalition government here, in order to prevent total economic collapse, is having to bring in extreme austerity measures and cut back public spending like never before.

To try and convince the public that this really is the way to run the economy they have to frighten us with announcements that, for example, the previous Labour government had been, at the end, borrowing £450 million a DAY, and that interest alone on the national debt was now running at around £40 billion a year - about the same as the defence budget which includes all the expenditure on the futile and illegal war in Afghanistan.

Last year, according to the ONS, the government borrowed £159.8 billion, equal to 11.4 per cent of the UK's entire economic output (GDP) - a record figure. In fact the level of government borrowing as a percentage of GDP has increased by more than four and a half times in just three years. No wonder we are paying £120 million a day in interest alone.

This sort of behaviour is simply unsustainable. The previous Labour government was, at the end of its term and knowing its time was up at the hands of the electorate, spending money at a ferocious rate, like squatters frantically wrecking a country mansion before the bailiffs arrived to kick them out.

Now our national debt is, we are told, equal to 71.3 per cent of our GDP. Let's take a minute to see how all these figures stack up.

If you were a private individual owing £20,000 and your income was £28,000 per year, if you were having to borrow £4.50 a day, or £1,640 a year, just to make ends meet, then you would be declared bankrupt. You would probably have an administrator or trustee appointed to pay off your creditors at so much in the pound, leaving you with next to nothing. These figures are proportionally the same as those applying to the British government.

I've put the question before in this blog - with all these trillions of pounds and dollars owed by Britain and the US, and other countries like Ireland, Greece, Portugal, Spain, Italy, Germany and France, not to mention Iceland and countless other countries with smaller economies, who is it exactly who are lending the money?

Does it all originate from China and other Far Eastern countries? No, it doesn't. While these countries are running massive trade surpluses they, too, are now feeling the brunt of the same forces as those responsible for the economic mess in Western countries. A proportion of Western debt has been bought by the Chinese and others, but only a tiny one.

The real culprits are the likes of Goldman Sachs, the Rothschilds, the Rockefellers, the Schiffs, the Warburgs and all the rest of the banking families that have been sucking the wealth out of all countries for the last 300 years and more. The nations of the West have grown weak and emasculated, while the banking families have grown prosperous and powerful.

It's obvious isn't it? If you get rid of the diabolical banking system and the greedy power-crazed parasites behind it then you get rid of the problem.

Philip Gegan