Had to smile at this little pro-Labour economic ramble from our dear friends at the BBC entitled “Is UK Government debt really that high?”. The answer is YES. What next “Is Gordon Brown really that unpopular?” It’s Election Year so we can expect more of this pathetic nonsense from the BBC as they try to prop up Brown.
DEBT – WHAT DEBT?
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This analysis is absurd. Debt to GDP is a very crude number.
A few examples:
1. It ignores the holders of the debt. Almost all the Japanese debt is held by Japanese savers, the £1 trillion GPIF is the largest investment fund in the world.
2. There is no taking into account government pension liabilities: where the US has a huge number of funded pensions (e.g. Calpers is the 3rd largest investment fund in the world and that’s just for general Californian state worker) most of Britain’s government pension liabilities are unfunded and straight out of general taxation. Not a problem if pension liabilities were growing in-line with inflation but Gordon Brown has quadrupled the government pension liability between 1997 and 2008!
3. The absolute level of debt is not as important as the rise in debt thanks to greater deficits (note Britain has the highest increase in the BBC used chart between 2007 and 2014). Italy has a deficit less than half of Britain’s, it is why, despite far higher overall levels of debt, the bond markets are not fretting about it as much (plus there is an implicit belief the Germans stand behind all Eurozone countries).
The greatest fallacy of the piece is the assumption that just because other developed countries are on the never-never its okay for Britain to be. How will Britain, with an open economy, be able to compete against the likes of China/Hong Kong, Singapore, Brazil, India, Russia, Canada, Australia or New Zealand with far higher tax rates?
Businesses located in Britain will be at a competitive disadvantage thanks to idiot politicians believing its more important to employ football coordinators and ethnic diversity officers than cut taxes.
I heard toilets McGuire waffling on on Radio 5 today (only Sir Michael Shite was missing) going on that our debt isn’t as bad as most other Countries and that we are not in as deep a recession as Germany!!!!!!!!!
When prats like toilets spout this nonsense it just makes them look stupid.
6 O’clock news has all the BBC big guns frothing at the mouth punting forward the nonsense document from Darling this morning.
Conveniently overlooking the almost £200Bn that we will be owing soon, the Conservatives are now being shown as economically incompetent – no questions are being asked of those that put is in this mess.
I’ve not watched anything BBC for a long time hence not posting here as often but this is propaganda paid for by the tax payer – pure and simple.
Forgot to add that News 24 went for the non-biased option when discussing the latest dodgy dossier earlier and so called in that doyen of impartiality for some eloquent words of wisdom – Toilets Maguire.
I would have smashed the television but LCD screens don’t explode as satisfyingly as CRTs used to.
What happens when the off-balance-sheet figures such as public sector pension commitments and the PFIs (public sector ENRONs) are added the base-line figures? And to check the health of the UK as a whole, what are the private debts (mortgages, loans, credit cards) and net external debt (cumulative trade deficit) of the UK as compared with Japan, or Italy, or Germany? Note that these three countries have retained their industrial bases so that debts can be financed. Now a journalist might ask those questions but a BBC mouth-piece won’t.
Brown and the Beeboids just don’t understand economics, finance, taxation and business. End of story !!!