Saturday, Apr 17, 2010
A startling claim about UK national debt
Burning Our Money Blog: Your Second Mortgage Problem
Wat Tyler asserts that "By 2014-15, even on the government's own highly optimistic projections, [national debt servicing] costs will reach nearly £73bn pa. That's £2900 pa for every single household - way more than their own average mortgage interest bill." If Tyler is right, barring a monetary and fiscal epiphany by the next government, whoever it may be, this crushing debt will load an extra £1,500 tax on the average household. Budget carefully before signing that mortgage!
Posted by quiet guy @ 01:32 PM (988 views) Add Comment
7 Comments
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1. paul said...
The alterative view is that you should pile in otherwise you'll be the one picking up the tab.
This is how its worked to date.
2. miken said...
The size of this interest bill is becoming ridiculous and it's all Libours fault. I say put higher taxes on all those who have had the luxury of second homes or BTL investments to help pay for this and start clamping down on the public sector waste. Right now there are far too many quangos who do virtually nothing for a high price at taxpayers cost.
3. Striebs said...
@1 "It is the way it's worked to date".
Prudence and responsibility doesn't pay . Never mind debtor's prisons but there is a case for disenfranchising people who can't manage their finances .
I have immense sympathy with people who want to find work but paying the interest for people who hocked themselves further than neccessary without budgetting for periods without work is just wrong .
@2 , we can't expect other people to pay for this fiasco , except our children unfortunately . The Govt really have mortgaged the future .... could take 25 years to sort this out and no mainstream politician is being honest about it . The growth figures they are assuming are pretty optimistic .
4. tenyearstogetmymoneyback said...
I think the situation is a bit more complex than he makes out.
If the average mortgage payments is really £2000 a year then we are all ready for another house price boom.
Then in five years time all the home ownerists will be saying "I know taxes are a bit high but my house is doubled in value so I'm better off".
If one the other hand interest rates have to go up .............
5. icarus said...
If you think government debt is high take a look at private sector debt. UK consumer debt alone (mortgages, loans, credit cards) is about the same as GDP. Interesting graphs on explosion of private debt vs public debt and GDP in the US at
http://midasletter.com/news/09012003_US-and-UK-on-brink-of-disaster.php
6. Simon said...
No doubt our politicians are going to tell us the other £1,400 per annum is going to come from cost savings by cutting out waste in such a way which does not affect front line services .
The growth figures the government are using are based on ungrounded optimistic .
Think the nation should assume zero growth (better than negative growth) and cut it's cloth to fit that .
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