No it isn't. This is an elementary howler. The national debt mentioned (the £1.4Tn) is the total amount accumulated over the past three centuries; the "77% of GDP" figure means that the total accumulated debt is 77% of a single year's income. That is the equivalent of earning £30,000 a year and having borrowed a lifetime total of £23,000.
As usual, you refer to 'debts' as though they exist in a vacuum. Debts correspond to assets; what to me is a debt is an asset to the bank, and what to the Treasury is a debt is also an asset to some pension fund, insurance company, or investor. We not only dump our debts on the unborn, we dump our assets on them too but you choose to disregard this half of the equation. Leaving debts is not in itself catastrophic, irresponsible, immoral, or indefensible. It is bad debts (i.e. debts which the debtor cannot service) which are catastrophic, and no part of the UK's national debt is unserviceable.
The debt is rising faster than the economy is growing and in that sense it is unsustainable. Sooner or later without a significant rebalancing of the economy we arrive at a situation where that debt takes more and more of our GDP to service and eventually it will become unmanageable. Do you see any reason to believe that we will do that necessary rebalancing any time soon ?
And by a happy coincidence £23,000 is about what every man, woman and child in the UK's share of that £1.4 trillion is. So let's say an even £50,000 for every taxpayer. Peanuts. Let's have a whip round and pay off the national debt
"Homes are way too expensive. I'd cut 50% of their value in a heartbeat by a hefty tax to reduce property prices. Sure it will piss off 80% of the population but something drastic needs to be done otherwise our kids will not have anywhere to live. I would also tax foreign investment companies to prevent them hiking property values at the expense of our childrens futures. But where will the investment come to build new homes? If the price we pay for investment is such that our kids cannot afford a home to start a family then that price is too high." "I do not see why I,and others like me, should suffer or be vilified because I invested my money in my home." "No-one is saying what you post Lightning so I guess you misread. Your parting paragraph is also daft. Socialist bullshit? Gimme a break. Last sentence I agree with. I'm a socialist. Nor do I want hard working people penalized. But there has to be a balance made between affordability and profiteering at the expense of the young. You cannot take it with you into whatever afterlife you believe in. Why should a young family have to pay through the nose to buy a home and remain in heavy debt just to keep you happy in profit? They work hard too, yet they cannot afford a proper home for their families. But you just sit on your UKIP high horse like the profiteer you are and watch the young struggle. Some people care. I guess you only care about yourself." ????????????????????????????????????????????????????????????????????????? I didn't buy my house to make money,I bought it to live in,just like I buy a bike to ride. I still have a bloody great mortgage,(thats my choice),so cutting the value of houses by 50% would leave me,and a lot of others,in huge debt,simply because I choose to spend my dough on where I live,not in the pub... I don't call myself a Socialist,nor a Conservative,Communist,or any other stupid catch-all title.I am a human being,and I respect the right of others to better themselves... Young families don't pay through the nose today any more than young families did 50 years ago-back then poor folk brought their kids up in caravans, and tied houses with no proper bathroom....they still got by,their kids grew up,and some of them worked bloody hard,saved up and went without to get into their own house These are the people who would suffer if you,"cut 50% of their value in a heartbeat"...not the wealthy aristocrat or landed gentry,the poor bastards that have struggled for a better life than their parents If you feel the urge to spend one generations money,(that is,those who left school at 16/have already grafted for a lifetime/paid their taxes/paid their N.I contributions for the promised old age pension),and give it to another generation,(who have barely started on their life of graft/are incredibly well-educated/will enjoy the benefits of a generous Welfare State and a fully fledged and funded NHS),there are better ways of doing it than using the politics of envy... I called it socialist bullshit because thats what it is,and as usual these idiotic ideas come from,and are trumpeted by,those who will be unaffected by it...
All those banks, insurance companies, pensions funds etc etc which have invested their funds in government stocks would not be very happy if those stocks were all suddenly (magically?) redeemed into cash. They would then be left with the problem of where to find investments where the risk/return balance is as good as UK government stocks - quite a tall order. The creditors probably prefer things the way they are.
Ok I've had a dig around the back seat of my two cars and the vans. Next is the sofas, then any old suits or trousers.
Just roughly worked out over the last twelve that running my Ducati has been expensive but my choice and the fun it gives me is beyond value. The spin of is that the government has got VAT, road tax, fuel duty of about £2300 off the back of this bike. This is after paying income tax and NI when getting the money together in the first place. It has provided work for technicians, profits for dealers and suppliers who have then contributed to the economy and paid taxes. Would it have benefitted society more if I had done something else with my hard earned cash?
This is making more sense, but I think annual HMG tax revenue is about half of GDP (which is effectively a turnover figure). Taking that into account, HMG borrowing an extra 100 billion a year is more like the 30K earner having a 50K mortgage but unable to make any repayments, and adding 5K a year to the debt.
For your information..... Despite the infamous British obsession with property, we’re far from being Europe’s top home-owning nation. Figures from Nationwide reveal that home ownership in Britain (the percentage of owner-occupied homes as a percentage of the housing stock) lags behind the likes of Hungary, Spain, Greece and Italy. Indeed, British home ownership peaked back in 2003 at 71%, with the high cost of property one key reason for the decline.
And the reason houses are so expensive: More than a third of Britain’s land is still in the hands of a tiny group of aristocrats, according to the most extensive ownership survey in nearly 140 years. In a shock to those who believed the landed gentry were a dying breed, blue-blooded owners still control vast swathes of the country within their inherited estates. A group of 36,000 individuals – only 0.6 per cent of the population – own 50 per cent of rural land. Read more: A third of Britain STILL belongs to the aristocracy | Daily Mail Online Follow us: @MailOnline on Twitter | DailyMail on Facebook
Productive enterprises need customers to purchase what they sell, if they are to remain in business and make profits. They also need investors to pay for the premises, plant, stock in trade, etc which enterprises need to get started. Spending your money as a customer has certainly benefitted those businesses in the short term; if you had invested money in businesses, the benefits to society would be more long term. The money you contributed to the government's tax take has also been beneficial to society, don't forget. The worst thing you could do (from the point of view of economic growth) is neither to earn nor to spend nor to invest at all.
But the best thing you can do for yourself is to become self-sufficient,and do exactly the opposite to those things good for economic growth....
Indeed. But part of the reason for the disparity between countries lies in the different tax regimes applied to home ownership. At one extreme, some countries have (or used to have) income tax relief on home mortgage payments or interest, thus incentivising owner occupiers. Some countries heavily tax income from property rental, thus disincentivising the private rental market. At the opposite extreme, some countries have (or used to have) the practice of regarding the benefit of occupying property to be a form of notional income on which income tax is payable - in the UK it used to be called Schedule D - thus disincentivising owner-occupiers. Even when the tax regime changes, the effects persist for decades afterwards. In some countries the authorities build and supply great amounts of publicly-owned housing for rental, or impose tight restrictions on building private housing, as a matter of political choice; other countries do the opposite. Again, even if policies change the effects persist.
