Economist public debt figures

Rochdale_Pioneers

A fun new tool here from The Economist: Global debt by country.

Makes for some interesting reading when you look at debt across the world.

2011 forecasts as % of GDP:

Zimbabwe 390%
Barbados 310%
Japan 235%
Iceland: 189%
Sudan 143%
Lebanon 142%
Italy 140%
Ghana 130%
Belgium 124%
Portugal 124%
Germany 116%
UK: 112%
Ireland: 112%
Israel 107%
Spain 106%
France 102%
Greece 101%
Canada 95%
USA 89%

Is it a great position for the UK to be in? Clearly not. Are we "the most indebted country in the world"? "Uniquely placed" to be sunk by debt? If governments of small poor countries can manage to find cash to borrow, why the idiotic suggestions that we won't be able to as 6th biggest economy in the world?

Looking at the data its pretty clear - this has been a global crash which has landed most of the major economies into masses of debt. Can the world economy - and the UK as a major player - survive that debt without austerity/the IMF/default? Of course - we did last time.

Mr_Mumble

Rochdale_Pioneers wrote: »

Are we "the most indebted country in the world"? "Uniquely placed" to be sunk by debt?

Nobody said any of this, typical strawman.

If governments of small poor countries can manage to find cash to borrow, why the idiotic suggestions that we won't be able to as 6th biggest economy in the world?

Being smaller countries they nominally borrow less, usually at a higher rate and usually in a foreign currency.

Looking at the data its pretty clear - this has been a global crash which has landed most of the major economies into masses of debt.

Italy, Japan and Germany had big deficits going in, Italy is a basket case while Germany and Japan have huge current account surpluses. Germany is legislating to make the deficit a maximum of 0.35%, that compares to an expected deficit for Britain of 5.5% in 2013-2014.

Can the world economy - and the UK as a major player - survive that debt without austerity/the IMF/default? Of course - we did last time.

When was this last time you speak of? Couldn't have been in the 70s when we went to the IMF, can't be WWII when we had austerity and a vast military and empire that could be cut back on. Guess you could go back to the Napoleanic Wars but Britain had the advantage then of the population doubling in 40 years to pay off the debt.

Generali

It's meaningless unless you include unfunded liabilities too.

You seem to post on here a lot with pieces showing that things are worse elsewhere and indeed they are. Japan and Italy spring to mind as places that are screwed. However, that doesn't put the UK in a good position, just a less bad one. If I'm dying in a hospital bed, I'm not that bothered about whether the bloke in the next bed has an even worse condition!

Mr_Mumble

Even uber-bull Jim Cramer is worried about government debt:

Dear Jim: Should investors be worried about the national debt we have accumulated here in the US? If you would, please explain how you feel this will impact average citizens and investors in the near and long term. - Thanks much, Tony

Cramer says: My friend Doug Kass who works at TheStreet.com talks endlessly about how bad this will be. I know that it means our taxes are going to go way up. I have to tell you that it means that eventually this market will come down. It is in what I call the 'out years' and not to worry about it yet. It weighs on me every day. It should weigh on you too. And if there isn't some discipline in Congress we're going to be talking about a new bear market in 18 months. That's if we don't get this stuff under control.

Rochdale_Pioneers

Hannan: "“You know and we know and you know that we know that it’s nonsense. Everyone can see that Britain is uniquely badly off. The IMF says so. The European Commission says so."

Do you want me to pull Hansard and show the various points where Cameron stood up and told everyone that UK government debt was highest in the world? Paul Krugman had a pretty clear response to it: "just wrong"

Camerosborne have been desperately talking down the economy for over a year now. They must be so disappointed. No sign that to quote Cameron "the money will run out," a "catastrophic fiscal position", or that we "run the risk of not being able to meet your obligations"

But as you say, its a straw man argument and Tories have never said such things.

purch

Leaving aside the political nonsense, because it is pretty obvious that the next Prime Minister and Treasury team will be equally as incompetant as the current Pm and Treasury, this wonderful new tool just highlights the untenable situation so many countries have got themselves into.

As Gen say's, add the unfunded liabilities and the numbers will become truely frightening, and yes not just the U.K.

The longer our idiotic and unworthy politicians continue to throw mud at each other and ignore the growing problem, the worse it will get.

Generali

Rochdale_Pioneers wrote: »

Hannan: "“You know and we know and you know that we know that it’s nonsense. Everyone can see that Britain is uniquely badly off. The IMF says so. The European Commission says so."

Do you want me to pull Hansard and show the various points where Cameron stood up and told everyone that UK government debt was highest in the world? Paul Krugman had a pretty clear response to it: "just wrong"

Camerosborne have been desperately talking down the economy for over a year now. They must be so disappointed. No sign that to quote Cameron "the money will run out," a "catastrophic fiscal position", or that we "run the risk of not being able to meet your obligations"

But as you say, its a straw man argument and Tories have never said such things.

I'm not particularly a Cameron supporter (although I usually vote Tory as the best of a bad lot) and I'm not arguing in favour of what he says.

My points (which I thought were pretty clear) are:

1. Just because other countries are in a worse position than the UK, doesn't make the UK in a good position. It just means other countries are going to go bust sooner (eg Italy and Japan).

2. The unfunded and unaccounted for liabilities (estimated at £6,000,000,000,000 I believe for pensions, healthcare banks and PFI (although the banks' liabilities shouldn't be measured in full IMO as there are assets to offset I don't have the figure without the bank liabilities included)) are too big to be paid so will be defaulted on.

How do you think the bill for pensions is going to be paid? Don't forget that those liabilities are index linked so inflation isn't going to rescue you.

Generali

purch wrote: »

As Gen say's, add the unfunded liabilities and the numbers will become truely frightening, and yes not just the U.K.

The longer our idiotic and unworthy politicians continue to throw mud at each other and ignore the growing problem, the worse it will get.

The thing is, most British people don't yet care about it either. They will once they retire and realise that all those years of 'paying in' via NI are worthless as the money's all been spent. It's the biggest Ponzi scheme there is and people are going to be livid once they realise they've been sold down the Swanee.

Australia is (I believe) one of the few countries to have addressed these problems having set up The Future Fund which at present contains $61,040,000,000 against future liabilities estimated at $200,000,000,000 by 2020. The aim is for it to be fully funded by then. My guess is that it will get in a year or two ahead of that.

bendix

Rochdale_Pioneers wrote: »

Hannan: "“You know and we know and you know that we know that it’s nonsense. Everyone can see that Britain is uniquely badly off. The IMF says so. The European Commission says so."

Do you want me to pull Hansard and show the various points where Cameron stood up and told everyone that UK government debt was highest in the world? Paul Krugman had a pretty clear response to it: "just wrong"

Camerosborne have been desperately talking down the economy for over a year now. They must be so disappointed. No sign that to quote Cameron "the money will run out," a "catastrophic fiscal position", or that we "run the risk of not being able to meet your obligations"

But as you say, its a straw man argument and Tories have never said such things.

Talking of straws, keep grasping them.

CLAPTON

yet... if fact many of these countries in these terrible situations have citizen who live very good lives.

This morning I found that clean water was flowing from my tap, the shower had hot water flowing, there was no sewerage flowing in the street, the electrivity worked OK, the gas heated my boiled egg OK, I check my bank balance online (yes the internet was working OK) and my balance was fine, the rubbish was collected (they came early this week, I wonder if I should be worried): later I need to go buy some shopping, I'm confident that the shops will be full of the things I need.

And no I won't be worried about all those unfunded future liabilities. Of course I could, if I wished work out how many trillion we need to spend on state pension payments, education, health care etc etc over the next 40 years but then I would also work out the likely revenues over the next 40 years.

Any decent economist knows that fully funded schemes place the same 'burden' on future generations as unfunded liabilites... yes the mechanisms used to raise the resources are different but the 'burden' remains the same.

kennyboy66_2

Generali wrote: »

The thing is, most British people don't yet care about it either. They will once they retire and realise that all those years of 'paying in' via NI are worthless as the money's all been spent. It's the biggest Ponzi scheme there is and people are going to be livid once they realise they've been sold down the Swanee.

It's touchingly naive that you think people in the UK still consider that they are "paying in" to a NI fund. People see it as a tax, simple as that.
Means tested benefits exceed NI 'entitlement' ones almost everywhere in the welfare system.