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Why Isn't The Ballooning National Debt Seen As A Osborne's Massive Failure?

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I absolutely have never understood how Osborne has managed to more than double the national debt in 6 years (borrowed more than Labour did in 13 years) - in an age of apparent austerity no less - and the media rarely pick up on it, nor do the public. It's like it's OK. "Ah well, part of the post-2008 landscape, innit. Inherited from Labour, innit". How the hell did he earn that kind of pass?

Just on a purely technical, numbers level, he is the worst Chancellor of the Exchequer ever. His job is to keep the UK economy in good health. Instead, he's run up a bigger bill than any other chancellor. And what have we got for the biggest bill ever? Continued ZIRP, a zombie economy, a dead housing market, added 2 million+ cheap labour migrants to the population and got fractional growth in return. Grats, dude.

The fact that roughly half of the voters will vote OUT on 23rd June shows how unhappy people are with the status quo (regardless of the result). Again, a black mark against Osborne.

For those who say "oh, you know, he inherited a big mess" - yeah, we know. BUT he did say he would balance the books by 2015/2016. He NOPED that one in a big way. Now he's talking about 2020. FFS - do you believe him? Still borrowing £8Bn to £10Bn per MONTH. Never mind, look the other way.

edit: f'd up the title....as you know.

Edited by canbuywontbuy

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He has got away with it because he has confused the general public with the terms deficit and debt. The general public are either fooled or want to believe the lie that things are going well as the deficit is reducing.

He has managed to have such an abysmal record while imposing austerity on the poorest in society while making sure his paymasters are doing very well.

So from his perspective and those who pay him he is succeeding.

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Labour started with a booming economy and ******ed it up. The Tories started with a seriously ******ed economy and... ah, OK, ******ed it up even more.

Edited by MarkG

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He has got away with it because he has confused the general public with the terms deficit and debt. The general public are either fooled or want to believe the lie that things are going well as the deficit is reducing.

It's disgusting how they obfuscate such simple terms. Deficit = yearly debt. National Debt = overall total. Labour has a bad outlier deficit in 2009/2010, but their previous deficits were far far lower than Tory deficits 2010 to 2016:-

ukgs_chartDp01t.png

See 2015 at just under £60Bn? ONS revised this figure to £76Bn - see here > http://budgetresponsibility.org.uk/. Osborne has been the most irresponsible chancellor ever.

Edited by canbuywontbuy

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He has a complicit media and on board MPs on all sides.

The question is: where has all this money gone?

Tax credits, housing benefits, child benefits, interest payments on national debt, EU membership fees, overseas aid money, then there's the black hole of unofficial backhanders.....

Edited by canbuywontbuy

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Tax credits, housing benefits, child benefits, interest payments on national debt, EU membership fees, overseas aid money, then there's the black hole of unofficial backhanders.....

Those things are included in the deficit average ~£80b - growth in debt £800b? (doubling since 2010) seems greater than deficits?

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Labour started with a booming economy and ******ed it up. The Tories started with a seriously ******ed economy and... ah, OK, ******ed it up even more.

+1

This is why voting is like picking an STD

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Those things are included in the deficit average ~£80b - growth in debt £800b? (doubling since 2010) seems greater than deficits?

Where do you get the average as £80Bn per year under Tory government?

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+1

This is why voting is like picking an STD

Agreed. Voting validates the control system and the miniscule scope of "choice" we are offered.

However, #Brexit represents the closest thing to a system reset we are going to have a chance to effect in my lifetime, so for my childrens future I'm voting. I didn't vote in the last GE having voted tory in 2010 falling for all their bllsht in the buildup then watching them renege on every single one of their promises in the next few years. I'd opted out of politics entirely but I believe this represents a semblance of a chance for the public to vote against the establishment so to speak.

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Agreed. Voting validates the control system and the miniscule scope of "choice" we are offered.

However, #Brexit represents the closest thing to a system reset we are going to have a chance to effect in my lifetime, so for my childrens future I'm voting. I didn't vote in the last GE having voted tory in 2010 falling for all their bllsht in the buildup then watching them renege on every single one of their promises in the next few years. I'd opted out of politics entirely but I believe this represents a semblance of a chance for the public to vote against the establishment so to speak.

I'm going to vote Brexit, no questions.

I am nervous about not voting in general though. It'd be easy for the establishment to mistake disgust for apathy amongst the young/non boomers.

There's no obvious answer to that though, as we lack a none of the above option.

Edited by SE10

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It's actually pretty straight forward.

The deficit is how much more the government spend each year on day to day expenditure - services, benefits etc, than they take in taxes.

The debt is the total of all the previous deficits, PLUS capital expenditure. If they borrow money to build a hospital, the total cost is added to the debt, but only the interest costs are included in the deficit.

If you're sneaky, and what a new hospital, but also want to keep the national debt within the EU's imposed limits, you do a PPI deal. It costs more than interest servicing, but hides the overall financial obligation, because it's not actually a debt.

Worth noting that under the current system, you have to keep growing the debt, simply to create the new money to pay the interest on the debt.

That's why austerity isn't working. By trying to reduce the deficit, and thereby the debt, through reduced government spending, they are reducing the money supply. ( since paying down debt destroys the money created when the debt was issued. )

And if you reduce the money supply, you induce a recession since people have less to spend... Unless you can persuade them to take on more debt themselves, thus creating the new money needed to maintain the money supply ( and pay the interest on it).

So debt based asset bubbles, student loans, PPI deals ( the "partner" still borrows the money, it's just that the debt's on their books instead of the government ).. you name it.. anything to keep the borrowing going. The great Ponzi.

It's becoming apparent that if you reduce government debt, you increase private debt and kill the economy. and if you do that, tax receipts fall, so if you want to provide the same services the government has to borrow more anyway.

The only solution is to change the way money is created, Until then, we need to end austerity to start increasing the deficit, getting the debt back on the government books, so as to make a start on reducing personal debt, so people can start spending again and the economy can recover.

Edited by ManVsRecession

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Coalitionstarted with 12% budget deficit in 2010.

Cons now have it downto 5%.

The debt is downto the loon Brown.

I dont likeGidiot but the fckup is Labour. It would be nice to be able to slash dverything when governments chage but they cannot - witness the fuss abouttax credit changes, which are the root of the budget deficit and immigration crisis.

Coal and Cons should have been brutal on cutting spening but they were to scared ornot grasped the degreethat Brown had overspent on building his client state.

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Because the vast majority of the general public aren't even aware of the national debt/deficit, or just consider it to be some meaningless number that has no direct effect on them... what they are aware of is their house has gone up £xxxx in the last minute/week/month/year and that of course is REAL money.

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It's disgusting how they obfuscate such simple terms. Deficit = yearly debt. National Debt = overall total. Labour has a bad outlier deficit in 2009/2010, but their previous deficits were far far lower than Tory deficits 2010 to 2016:-

ukgs_chartDp01t.png

See 2015 at just under £60Bn? ONS revised this figure to £76Bn - see here > http://budgetresponsibility.org.uk/. Osborne has been the most irresponsible chancellor ever.

In reality the labour party were running large hidden deficits in 2005-2008. The country had an inflated 'income' from a growing economy, taxes paid by the banks and a rampant property market. RBS alone paid £16Bn in corporation tax in the run-up to 2007, that is a truly staggering number, although of course not as large as the bailout! I don't totally blame labour as to be fair it was hard to predict to crash. I would blame them for the scandal of PPI which was just another way of borrowing from the future with it showing on the books and has wasted billions of tax payer money

Once the tide went out and revenue collapsed, Osborne was faced with a monsterous deficit problem and taking many many years to fix it. The problem for any politician trying to reduce spending is that if you cut too hard you lose your job but cut too slow and you lose the market confidence . . . he's probably done as well as anyone else would have in his position.

I also think that if the UK probably done as well as could be expected - since 2008 we have outperformed France, Germany and most of Europe. Given we are such an advanced economy is not realistic to expect the UK to grow at the pace of china or India

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Cannot agree with hardly any of that.

Yes Gordon Brown did fire the starting pistol, but the governments since have taken the baton from him and continued, NO, starting speeding up.

The deficit is only relevant if you believe we have had good organic real GDP, I do not.

In order to get where we are today, we had to do QE to the tune of £375 Billion, we forgave huge sums of debt, we purchased as taxpayers failing banks and we now have a national debt of £1.7 Trillion.

Quite simply it is like looking at a regular guys finances for the next three years. He earns say £30k a year and can only just manage to live without getting into any debt, but he does. His mate on the other hand also earns £30k a year, but he has gone and taken out an overdraft or personal loan for £30k and finds life for the next three years comfortable.. All is rosy?

All that has happened since the 2007 financial crisis is the plates have been kept spinning and we had/have an illusionary recovery where we felt no pain. The moment that GDP figure goes down, and it will, the true deficit number will come out, and it will not be anything like 5%

Im not sure why you disagree. The deficit numbers are recorded facts.

Tenpintoms provides a bit more info - the economy 2002-2008 was a massive credit boom, driven by Brown to fund his bribes.

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Im not sure why you disagree. The deficit numbers are recorded facts.

Tenpintoms provides a bit more info - the economy 2002-2008 was a massive credit boom, driven by Brown to fund his bribes.

It's not just deficit. Now we have money printing as well and the reflating of the banking and house price ponzis. It's worse than what the tories inherited.

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OK

Using that argument, The cost of a house today in Britain must be the true value because that's what the data says.

or

House prices have need manipulated and rigged. and they are at least 30% over valued

We are talking about UKGOV deficit.

Dont conflate with over priced houses.

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It's not just deficit. Now we have money printing as well and the reflating of the banking and house price ponzis. It's worse than what the tories inherited.

Yes it is.

When in hole stop digging.

CoDems should have kitchen sinked in 2010. Chickened it.

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Cannot agree with hardly any of that.

Ok let's simplify it a bit for you. The debt only looked good under Gordon Brown because he was raising taxes on an asset bubble. The overspend was there and was revealed when the tide went out (2008 crash).

== edit I see TenPinTom has said much the same with more detail

> I also think that if the UK probably done as well as could be expected - since 2008 we have outperformed France, Germany and most of Europe.

France has been a basket case because, under the Socialists, they decided to do real austerity by hiking taxes which caused the tax base to collapse - the rich went abroad, firms stopped hiring and everyone else stopped spending. Again not entirely Francois Hollande's fault as he was constrained by the EU and Euro membership but it has still been disastrous. I read a report which claimed 10s of thousands of extra deaths due to stress related illnesses and suicides; it is like France's cultural revolution.

Edited by davidg

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It's actually pretty straight forward.

The deficit is how much more the government spend each year on day to day expenditure - services, benefits etc, than they take in taxes.

The debt is the total of all the previous deficits, PLUS capital expenditure. If they borrow money to build a hospital, the total cost is added to the debt, but only the interest costs are included in the deficit.

If you're sneaky, and what a new hospital, but also want to keep the national debt within the EU's imposed limits, you do a PPI deal. It costs more than interest servicing, but hides the overall financial obligation, because it's not actually a debt.

Worth noting that under the current system, you have to keep growing the debt, simply to create the new money to pay the interest on the debt.

That's why austerity isn't working. By trying to reduce the deficit, and thereby the debt, through reduced government spending, they are reducing the money supply. ( since paying down debt destroys the money created when the debt was issued. )

And if you reduce the money supply, you induce a recession since people have less to spend... Unless you can persuade them to take on more debt themselves, thus creating the new money needed to maintain the money supply ( and pay the interest on it).

So debt based asset bubbles, student loans, PPI deals ( the "partner" still borrows the money, it's just that the debt's on their books instead of the government ).. you name it.. anything to keep the borrowing going. The great Ponzi.

It's becoming apparent that if you reduce government debt, you increase private debt and kill the economy. and if you do that, tax receipts fall, so if you want to provide the same services the government has to borrow more anyway.

The only solution is to change the way money is created, Until then, we need to end austerity to start increasing the deficit, getting the debt back on the government books, so as to make a start on reducing personal debt, so people can start spending again and the economy can recover.

Very well explained.

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Ok let's simplify it a bit for you. The debt only looked good under Gordon Brown because he was raising taxes on an asset bubble. The overspend was there and was revealed when the tide went out (2008 crash).

== edit I see TenPinTom has said much the same with more detail

> I also think that if the UK probably done as well as could be expected - since 2008 we have outperformed France, Germany and most of Europe.

France has been a basket case because, under the Socialists, they decided to do real austerity by hiking taxes which caused the tax base to collapse - the rich went abroad, firms stopped hiring and everyone else stopped spending.

2002-2008 saw 'normal' Gdp growthrates of 2%-3%.

Put credit was expanding at 10% GDP/year.

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