British National Debt reaches a trillion pounds.
British National Debt has just reached a trillion pounds.
This is 1,000 billion pounds. The Nation Debt is increasing at the rate 2 billion a week.
David Camerons economic policies are not working.
SDP: As they used to tell us during the war; 'Remain calm and carry on'.Originally Posted by SDP
I have been saying for quite some time that the national debt is £1.3. trillion, and that is possibly closer to the truth. The first point is not the size of the debt, but the extent to which it has collateral. The lion's share of the N.D. comprises two elements; (1) the cost of nationalising the banks and, (2) the purchase of toxic debt. Efforts to privatise those banks, and replenish the coffers, should be a priority. Even the sale of just one or two would ease the national deficit, and that is the more immediate problem than the N.D. An amalgam of pension funds, perhaps, may be persuaded that they could be bankers; that may be a better prospect than pension investments which are producing a low yield, and are likely to remain low for many years. Buyers willing purchase toxic debts will be thinner on the ground; but as a cheap long-tern investment even those government holdings could be reduced in size even if sold at a loss. The immediate future is going to be difficult, but two predictions can be made with near certainty: considerably more Q.E. will be needed just to keep then show on the road, and (2) a war against Iran. Neither of those two things may appeal to you, but in my best scriptural language, they will come to pass.
While we are in a pessimistic mood, I see that the total EU unemployment aggregate is just shy of 43.6. million. Bearing in mind that unemployment figures are, for several reasons, always understated, you can be certain that the real figure will be about 50. million. Next year, we are told, further increases in the EU unemployemt rate can be anticipated. Ask not which euro-country will default on their debt, ask rather which one will experience constitutional and economic collapse. That must now be very close: economics is the Siamese-twin of politics. When is that young Eric Edmond's returning to the Kingdom? He knows about these things; ski-ing abroad while we all perish and scavenge for bread, is not the best example that we should be given. Forget about vague portmanteau explanations concerning 'wealth creation'; what will be the economic activity which will reduce those western world unemploment figures? That must be identified in quite specific terms. Answers are now being earnestly sought by the more superior clientele in the coffee houses of England. But remember, 'Keep calm and carry on'.
Last edited by Geoffrey Collier; 25-01-2012 at 10:21 AM.
Well at least the coffee houses will escape the recession as the superior clientèle sit round and discuss how to end the financial melt down as the world outside falls apart.Answers are now being earnestly sought by the more superior clientele in the coffee houses of England. But remember, 'Keep calm and carry on'.
The road to hell is paved in good intention.
About £45,000 per person according to BBC this Morning....
But by My reconing, it's only £15,300 ish, so that's okay then.
Geoffrey Collier
The key economic policy of this government is to give all the big manufacturing contracts to Germany and crumbs from the table to companies like Bombardier.
Is this policy going to create growth in Britain long term if we keep calm and carry on ?
SDP: It is foolish to presume that the key economic policy of this government is to patronise Germany manufacturers while deliberately neglecting British ones. Avoid all that is hysterical or demonstrably untrue in political and economic discourse. The government has three hopes: (1) Like Mr Macawber, they hope that something will turn-up. (2) Accept that nothing will happen for some time, and approve considerable Q.E. to commence very soon and continue for quite some time. (3) Try to reduce government expenditure at least sufficienctly to take pressure of the national deficit. That, I suspect, will be more aspirational than realisable. That is what they will try to do however imperfectly.
What constitutes wealth is as much a philosophical question as an economic one. That which used to be confidently explained by the classical economists, whether it be Adam Smith, Ricardo or Karl Marx, they were all drawring their reasoning from an agrarian society in various states of development towards a manufacturing one. An economic society like we have to-day, i.e. one founded on consumerism (in the western world) and seeking an economic basis on which a concomitant social organisation can survive, was both beyond their experience and economic paradigms.
Production needed labour and material in great measure. As I have said on many occasions, labour is a diminishing factor of production in all our historic economic activities. Create wealth, create wealth, has become an aerosol term which is sprayed on everything. What will be the dominant economic activity for the multitude when wealth is the result of labour, materials and economic investment; while human involvement diminishes increasingly to a minor role? But they will still be the consumers, and circulating to them money to obtain that which they need will be as necessary as ever.
One of the major purposes of economics is to allow a system to exist under which we can procure our needs within the law. We buy it, and that which we buy becomes ours in law. Let us lower our sight and think more in terms of creating a viable economic system, rather than engaging in some abstract economic debate about wealth-creation which is closer to metaphysics than the real world.
When you attack Civil Servants for not being involved in contributing to the GDP, and by implication the GNP, are you sure that you are correct? Do those among them who, for example, ensure that seven million old age pensioners get their pensions regularly, are not involved in 'wealth creation', as you call it? Do not those same pensioner buy food, purchase electricty and clothing, not to mention holidaying and, by so doing, create employemnt, and profits which keep the economy bouyant, and by that economic activity help to build a tax base. We could add doctors and nurses who allow many former patients to re-engage in employment. I do not think that your premise is sound. What will be the role of the poor in an urban society which requires a virtually non-existent labour force?
Actually that is really just administering wealth transfer ie money passed from one group to another. Most pensioners will have stopped doing anything productive for the economy (unless you count free babysitting services to allow their own children to go out to work).
Yes, you could add teachers to that and others involved in improving the lives of others who will then go on to do productive activity.We could add doctors and nurses who allow many former patients to re-engage in employment.
However also bear in mind that a large part of the cost of NHS doctors etc and local authority social care workers is in dealing with people that don't work (the elderly and long term disabled). So that cost is more of a social responsibility rather than wealth creating.
Geoffrey Collier
In a manufacturing company there are production costs and overhead costs.
In the economy of a country civil servants and pensioners are overhead cost.
Doctors, nurses and a school teachers may do very important jobs, but they are not productive workers and so are an overhead cost.
Overhead costs would include the Prime Minister, the Cabinet, MPs, judges, solicitors, barristers, police, civil service and most clerical jobs.
Gordon Brown used to talk about investing in the public services. An investment is sometime that pays a dividend and keeps your money safe.
Gordon Brown was wrong. You cannot invest in business expenses or overhead expenses. Having more nurses and doctors may be a good thing, but it is not an investment.
An investment is something you can sell and get your money back. You cannot sell doctors and nurses and get your money back, so they are not and investment.
Last edited by SDP; 28-01-2012 at 11:25 AM.
Geoffrey Collier
As a country we must spend more money on productive workers.
And reduce the money spent on overhead expenses like the civil service.
If we continue to spend all our money on overhead expenses, then national debt will continue to get bigger and bigger.
As a coutry we must learn to make things again.
CB100: I am not suggesting that pensioners haven't finished their 'productive' life, but they are as 'spenders' an important part of the economy for reasons which I have given. By your reasoning the staff in any 'wages office' are just administering wealth transfer. As I have said before; agriculture employs 1.6% of the labour-force while producing 60% of our food: that percentage could increase with little additional labour being required. Retailing is the second most productive part of the economy in terms of GDP, but that is only possible because most people have purchasing power gained from various sources. I can only repeat what I have said before; manufacturing can be increased, but it would only survive if it is capital not labour intensive. The most inefficient parts of the private economy are those which are still labour intensive. Small shops employ much larger labour forces collectively than the supermarkets. Mostly they have a meagre share of the whole market. The same can be said for agriculture; hill farmers, crofters, smallholders and the like, comprise a large part of that 1.6 labour force. Agriculture, from the smallest to the dominant land-owners, are a charge on the taxpayer. Manufacturing is so imprecise a term, we would first have to discover what they are manufacturing; lemonade, fighter jets, or Mr Kipling's cup cakes. Manufacturing is number three on the GDP list but, again. they are cosseted from the real world by insurance-cover from the government which no private insurer would contemplate. Would you be agreeable to insurance being subject to the discipline of the market-place? If private insurers won't provide it, they don't get it. Would you remove the entire insurance guarantees provided by the government to exporters? We are the world's second largest arms exporter; we lose constantly insuring small-arms and, frequently, insuring large armament sales to unstable governments. Talking of insurance costs; industrial workers who contract an industrial disease, receive pensions from their own N.I. contributions and these are paid by the government. Surely, those pensions should be paid by the owners of the industry from which the injury or disease was inflicted. Our friend SDP would describe these payments as 'overhead costs', and presumably they are not the governments responsibility?
Finally, don't be too quick to assume that the caring services, by providing for the elderly or the long-term disabled, are not making - or at least mitigating - public expenditure. Arranging short-term respite care for the carers, often ensures that they are able to continue. With about half a million demented souls among us, humanity and cost are finely balanced. However, I am sure that you are a humane and civilised individual, amd already know that.
Last edited by Geoffrey Collier; 28-01-2012 at 02:25 PM.
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