Been on Facebook with this one continuously, can’t remember if its blogged. Just crudely throwing this together, but complete analysis shows the same picture…
Grabbing UK debt off Google… (1995 to 2013)… Debt has been stable or falling over a long period up to 2007. Then doubles from 2007 to 2010. Where did this debt come from? But firstly is it falling GDP?
UK GDP off Google… (1965 to 2013)… GDP falls 11%. So no that is real debt in the public purse.
Famously there was an economic crisis in 2007. Debt famously was created in banks by them buying US mortgages that would never get paid off. Much of the debt was secretly parcelled in the infamous CDO (collateralised debt obligations). This is the official story.
So we have been told that the debt was created in the US housing bubble, that banks bought that debt, and that the UK government then bought the debt off the banks to rescue them from collapse.
So we know the debt came from the banks.
But the political parties in the UK, including Labour, seem to think it was normal government over-spending (welfare, health, education, defence etc), despite the fact they’ve told us that it was bailouts to the city, and that all the excess debt occurred since 2007.
Clearly the political parties, the media and indeed almost everyone is confused. Yet despite being confused they all agree. How is this possible?
It can only be that they’ve all been told to disagree with what they were saying. Obviously the banking sector is massive and powerful; actually the most powerful. The UK Conservative Party gets almost all its funding from the City. The “conspicuous absence” of The City in contemporary explanations of the UK debt. And the total lack of presence of the ostensible culprits means that this is a full scale “cover-up”.
We’ve seen it recently in the Iraq War (2003 to 2011). Originally Iraq was linked to 9/11. There was no evidence, and the US failed to mobilise its more sensible allies to involvement. Then they used the risk of Saddam’s weapons and their potential threat. SCUD D missiles have a maximum range of 600miles giving them access to targets in Turkey, Iran and Saudi Arabia (and of course Israel). Hardly a “clear and present danger” to either US or Europe. Satellite photos of trucks and buildings was presented to the UN as evidence of chemical weapons (no-one was fooled). The BBC criticised the government, was made to look like they did something wrong (in a “free” nation?), and has never been very compliant ever since, and two other critics also died (coincidence). However unfortunately (and inexplicably) some US allies did accept the idea that Iraq was a threat and the UN passed a resolution, and a war happened.
Obviously Hussein had long ago removed his weapons (which he was sold by France and Britain anyway), since he didn’t want to antagonise the US more than necessary; and predictably no WMDs were found. This was not the reason for the war anyway, just an excuse. Once WMDs were not found, and “no threat” was proven, the US didn’t apologise and withdraw, instead they executed Hussein (logical). The new “reason” became a humanitarian crusade to free the people of Iraq. Just as Alexander the Great did in the 4th Century BC. One wonders why they didn’t present this excuse to the UN in the first place. Despite this transparent sequence of events, the “conspicuous absence” of a sensible description by politicians and the media and the persistence of the idea that the war was “justified” is much the same as the denial of the source of the UK Debt. Rather unfashionably these are called “cover-ups”, but if they aren’t then the word should be removed from the dictionary because there is no better example of “cover-ups”. The Westminster Paedophile scandal which is exploding in slow motion in the UK gives some idea of the duration and water tight nature of the establishments ability to protect itself, cover-up and generate false news.
Personally I wouldn’t mind so much, but exactly the same establishment rejoices in the ability of other world leaders (conspicuously of enemy states/groups) to generate propaganda, while never acknowledging that it is perhaps the World’s best… but then which compulsive liar would ever admit they were a liar. (Politicians never tell the truth. I am a Politician.)
Serious Economics
Given that The City has got us into this fine mess, what options do we have? The standard Keynesian solution has been to buy our way out of recession, but we have been doing that since the dotcom bubble crash of 2000. But our modern economies only survive by continued, unending financial stimulus anyway. Its not a fix for times of crisis, it a fix for normal running these days! We can be sure that even if all “normal” government spending ends we will still be paying high taxes just to prop up the economy (stimulate inflation, keep people spending, create jobs, and direct bailouts like UK selling Gold in 2000 etc).
But if we don’t prop up the economy then the whole house of cards will come down. UK still has a housing bubble, much private debt is offset against the value of houses. If there is deflation, or market sentiment turns seriously bearish the crash will be catastrophic. There is the fear of UK borrowing costs increasing also, finally hoisting the UK on the petard it has terrorised the rest of the world with for several centuries. The ostensible panic solution has been to sell off more of the state; not much to privatise any more (though the NHS is being cut up bit by bit, like the rainforests), the only thing left is to divert tax money directly into the National debt.
The Party Faithful will say that this “panic” solution hasn’t come easily and the Conservatives are at pains to do it. But sceptics will see the long term Tory plan of sell offs and handing of power to their backers in the City.
Taking stock of the situation however, it’s all a bit odd. From Reagan and Thatcher to the relaxing of the Glass-Steagall and the UKs market liberalisation until today the path has been one of giving more freedom and money to the City and the markets. And where has it got us? People point to the great progress in technology (the telecommunications revolution, the miniaturisation of electronics and iPads) and the global markets with a greater variety of foods and cheaper clothing. But all this was happening anyway. In terms of fundamentals life since Thatcher has been harder. Real wages are lower. After the boom of council house sales, we now have a private housing system and an inevitable boom meaning that most people will never own a home; paying debt for the rest of their lives. Job security is lower, with competition from overseas markets, shorter more flexible contracts, and that same telecommunications revolution creating machines that have taken jobs. To the winners the dynamic nature of modern economics is a dream, but to the losers it is the worst nightmare. And this is reflected in the inexorable growth of inequality. While the rich, feasting on all those bailouts and financial support from the tax payer, celebrate; the tax payers (employees, and start up businessmen) who must shoulder all the burden of economic uncertainty and risk; they live lives of increasing difficulty.
And all this in an post-industrial technologically advanced economy existing 4500 years after the Neolithic economy had the surplus wealth to erect StoneHenge. Wealth and production haven’t been issues for mankind for 4000 years, and most certainly not the problem today. The problem, and the source of Mankind’s toil today is economics and its misuse (either through ignorance or design) by those who have the responsibility and the wealth to ensure it, not us, works!
So UK Debt? It’s a load of obvious nonsense.
