LEAVE the Conservative Party and save your country!

pblakeney

The notion that government debt does not influence other areas is quite a big one.

surrey_commuter

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Servicing costs are currently falling as the cost of refinancing existing debt is lower, think of it as re-mortgaging at a lower rate. Of course when you you remortgage they will stress test your ability to pay at higher interest rates. Rick’s (and mainstream economic argument) is that you don’ t need to worry about higher rates.

Rick - can you confirm why we should not worry about higher rates

surrey_commuter

pblakeney said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

My prediction is ten years from now in the aftermath of the next financial crisis.

We are already in a financial crisis, only borrowing is keeping it behind a veil.
We are going to be increasing that deficit for quite a while, or let the veil slip and wake up to how bad it is.
I agree that borrowing is required just now to keep afloat but we started with a leaky boat and they don't resolve themselves.

I take your point but for me the financial crisis brought on by excessive debt will be the one after and will be brutal - think Greek levels of spending cuts.

If you know any (seriously) rich Greeks they are totally untouched by it.

Stevo_666

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Fair point, I suppose we shouldn't complain if it's people like Rick who end up picking up the tab rather than us

There will be breaking point somewhere, as clearly it cannot go on indefinitely. People need to think longer term here.

rjsterry

Stevo_666 said:

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Fair point, I suppose we shouldn't complain if it's people like Rick who end up picking up the tab rather than us

There will be breaking point somewhere, as clearly it cannot go on indefinitely. People need to think longer term here.

It's all a little academic at the moment. Regardless of of the rosette, our and every other government is already borrowing in quantities that mean it will still be being paid off well into our grandchildren's working lives or beyond. The decisions have already been taken. I don't see why this is really any different to me paying off WW2 loans or the abolition of slavery. The best any of us can hope for is that the amount blown on non-existent PPE supplies and the like is kept to a minimum.

rick_chasey

surrey_commuter said:

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Servicing costs are currently falling as the cost of refinancing existing debt is lower, think of it as re-mortgaging at a lower rate. Of course when you you remortgage they will stress test your ability to pay at higher interest rates. Rick’s (and mainstream economic argument) is that you don’ t need to worry about higher rates.

Rick - can you confirm why we should not worry about higher rates

40 year unlinked bonds are going for well under inflation... why does anyone here know more then the market participants?

And Stevo - its about the cost of debt servicing vs cost of not propping up economy in downturn.

As per my previous post

surrey_commuter

rick_chasey said:

surrey_commuter said:

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Servicing costs are currently falling as the cost of refinancing existing debt is lower, think of it as re-mortgaging at a lower rate. Of course when you you remortgage they will stress test your ability to pay at higher interest rates. Rick’s (and mainstream economic argument) is that you don’ t need to worry about higher rates.

Rick - can you confirm why we should not worry about higher rates

40 year unlinked bonds are going for well under inflation... why does anyone here know more then the market participants?

And Stevo - its about the cost of debt servicing vs cost of not propping up economy in downturn.

As per my previous post

As I am sure you know most debt is not dates anywhere near that long. There is demand because of pension liabilities.

You will never persuade me it is not a colossal annual gamble with only one eventual outcome.

TheBigBean

surrey_commuter said:

rick_chasey said:

surrey_commuter said:

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Servicing costs are currently falling as the cost of refinancing existing debt is lower, think of it as re-mortgaging at a lower rate. Of course when you you remortgage they will stress test your ability to pay at higher interest rates. Rick’s (and mainstream economic argument) is that you don’ t need to worry about higher rates.

Rick - can you confirm why we should not worry about higher rates

40 year unlinked bonds are going for well under inflation... why does anyone here know more then the market participants?

And Stevo - its about the cost of debt servicing vs cost of not propping up economy in downturn.

As per my previous post

As I am sure you know most debt is not dates anywhere near that long. There is demand because of pension liabilities.

You will never persuade me it is not a colossal annual gamble with only one eventual outcome.

Do you know the average loan life of all UK gilts? I can't find it by googling and I don't have the energy to work it out myself.

surrey_commuter

TheBigBean said:

surrey_commuter said:

rick_chasey said:

surrey_commuter said:

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Servicing costs are currently falling as the cost of refinancing existing debt is lower, think of it as re-mortgaging at a lower rate. Of course when you you remortgage they will stress test your ability to pay at higher interest rates. Rick’s (and mainstream economic argument) is that you don’ t need to worry about higher rates.

Rick - can you confirm why we should not worry about higher rates

40 year unlinked bonds are going for well under inflation... why does anyone here know more then the market participants?

And Stevo - its about the cost of debt servicing vs cost of not propping up economy in downturn.

As per my previous post

As I am sure you know most debt is not dates anywhere near that long. There is demand because of pension liabilities.

You will never persuade me it is not a colossal annual gamble with only one eventual outcome.

Do you know the average loan life of all UK gilts? I can't find it by googling and I don't have the energy to work it out myself.

Longer than most countries but the markets beyond 10 years are not that deep. I only know this because that is why we use the yield curve on 10 year gilts.

Pension funds would happily buy longer dated gilts to match their liabilities. There must be a reason why they are not issued in greater numbers - possibly the premium required?

Edited to add redemptions average £70-80bn per annum

Stevo_666

rick_chasey said:

surrey_commuter said:

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Servicing costs are currently falling as the cost of refinancing existing debt is lower, think of it as re-mortgaging at a lower rate. Of course when you you remortgage they will stress test your ability to pay at higher interest rates. Rick’s (and mainstream economic argument) is that you don’ t need to worry about higher rates.

Rick - can you confirm why we should not worry about higher rates

40 year unlinked bonds are going for well under inflation... why does anyone here know more then the market participants?

And Stevo - its about the cost of debt servicing vs cost of not propping up economy in downturn.

As per my previous post

According to you - some of us have other views.

See my posts above. It cannot continue indefinitely - if you thinkmit can you are wrong - it is simply another one your Ponzi schemes like the ever increasing population idea.

Stevo_666

rjsterry said:

Stevo_666 said:

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Fair point, I suppose we shouldn't complain if it's people like Rick who end up picking up the tab rather than us

There will be breaking point somewhere, as clearly it cannot go on indefinitely. People need to think longer term here.

It's all a little academic at the moment. Regardless of of the rosette, our and every other government is already borrowing in quantities that mean it will still be being paid off well into our grandchildren's working lives or beyond. The decisions have already been taken. I don't see why this is really any different to me paying off WW2 loans or the abolition of slavery. The best any of us can hope for is that the amount blown on non-existent PPE supplies and the like is kept to a minimum.

You can't change the past but why repeat this into the future when the eventual and logical outcome is known? Unless you are being short termist or short sighted as Rick appears to be on this issue.

rjsterry

Stevo_666 said:

rjsterry said:

Stevo_666 said:

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Fair point, I suppose we shouldn't complain if it's people like Rick who end up picking up the tab rather than us

There will be breaking point somewhere, as clearly it cannot go on indefinitely. People need to think longer term here.

It's all a little academic at the moment. Regardless of of the rosette, our and every other government is already borrowing in quantities that mean it will still be being paid off well into our grandchildren's working lives or beyond. The decisions have already been taken. I don't see why this is really any different to me paying off WW2 loans or the abolition of slavery. The best any of us can hope for is that the amount blown on non-existent PPE supplies and the like is kept to a minimum.

You can't change the past but why repeat this into the future when the eventual and logical outcome is known? Unless you are being short termist or short sighted as Rick appears to be on this issue.

It's not a question of whether you or I think it's a good or bad idea, the borrowing commitments stretching into the future are already there. We are not remotely done with Covid or Brexit fallout, so that's the most likely reason for further borrowing, whether it's direct health spending, customs infrastructure, some extended form of job support or a massive increase in unemployment benefit payments. Then of course there is HS2, the tunnel under Stonehenge and + all the other road building; the 'levelling up'; all state aid we are going to give those tech startups. All of it decades-long commitments, so a bit late to be fretting about how long all this extra borrowing is going to last. And most of this was in the 2019 manifesto. I know you keep saying what was the alternative, but if you are that averse to long term borrowing why on earth did you vote for them?

rick_chasey

Thing is - the govt will end up paying the money anyway via the dole and associated problems.

The calculation is obviously predicated on furlough etc being time limited and the longer it goes the less sustainable it becomes - but the idea that it feels too much isn’t helpful - it’s about what the numbers are saying and what else the govt can do to reduce the need for lockdowns - like test & trace etc

rick_chasey

TheBigBean said:

surrey_commuter said:

rick_chasey said:

surrey_commuter said:

pblakeney said:

rick_chasey said:

surrey_commuter said:

kingstongraham said:

There's a huge risk in not spending money to keep things afloat.

Strangely that is the one thing we are all agreed on. My argument is that we now live in a world of permanent budget deficits which means we start each crisis in an increasingly worse position.

In less than 20 years we have gone from Govt’s balancing the books over the lifetime of a Parliament to a position this Feb where after a decade of deficits Boris set out plans to borrow £60bn.

Maybe we should have a poll on what year we all think annual borrowing will fall below £100bn.

My prediction is ten years from now in the aftermath of the next financial crisis.

permanent deficit is ok if the cost of servicing isn't rising, right?

I would moderate off the back of that, not some arbitrary feeling that the deficit is "big" or not because the numbers seem large.

But the deficit is rising, so the cost of servicing it is rising.
There will be a breaking point somewhere. Didn't you used to complain about passing the problems of today onto the young and future generations?

Servicing costs are currently falling as the cost of refinancing existing debt is lower, think of it as re-mortgaging at a lower rate. Of course when you you remortgage they will stress test your ability to pay at higher interest rates. Rick’s (and mainstream economic argument) is that you don’ t need to worry about higher rates.

Rick - can you confirm why we should not worry about higher rates

40 year unlinked bonds are going for well under inflation... why does anyone here know more then the market participants?

And Stevo - its about the cost of debt servicing vs cost of not propping up economy in downturn.

As per my previous post

As I am sure you know most debt is not dates anywhere near that long. There is demand because of pension liabilities.

You will never persuade me it is not a colossal annual gamble with only one eventual outcome.

Do you know the average loan life of all UK gilts? I can't find it by googling and I don't have the energy to work it out myself.

I think the deets are available in excel form on the treasury site but you’ll have to do the calcs yourself

rjsterry

And for the OMG-this-is-unprecedented crowd.



Turns out building an empire requires lots of borrowing, mostly paid off by asset stripping that empire.

surrey_commuter

rjsterry said:

And for the OMG-this-is-unprecedented crowd.



Turns out building an empire requires lots of borrowing, mostly paid off by asset stripping that empire.

Total debt is now at level last seen in 1960 when growth was 6%. Anybody confident that we will be able to match that?

And that graph is wrong as it claims FY 2020 and has debt well below 100%.

Now roll forwards to 2024 and that graph will be at 150% and right up there is the top 10 debt highs with two world wars.

surrey_commuter

rjsterry said:

And for the OMG-this-is-unprecedented crowd.



Turns out building an empire requires lots of borrowing, mostly paid off by asset stripping that empire.

I am becoming fixated by this graph and your OMG unprecedented comment.

The precedents on that graph are the Napoleonic wars followed by a century of debt reduction before two world wars and half a century of deficit reduction. Now we are inexorably heading towards 150% due to our politicians being self serving cvnts.
My argument is if had the same calibre of politicians in the 1800s then we would have gone into WW1 at 200% debt and come out of WW2 with 600%.

I asked a question further up that went unanswered.

When do you think we will next see a deficit under £100bn?

rick_chasey

surrey_commuter said:

rjsterry said:

And for the OMG-this-is-unprecedented crowd.



Turns out building an empire requires lots of borrowing, mostly paid off by asset stripping that empire.

I am becoming fixated by this graph and your OMG unprecedented comment.

The precedents on that graph are the Napoleonic wars followed by a century of debt reduction before two world wars and half a century of deficit reduction. Now we are inexorably heading towards 150% due to our politicians being self serving cvnts.
My argument is if had the same calibre of politicians in the 1800s then we would have gone into WW1 at 200% debt and come out of WW2 with 600%.

I asked a question further up that went unanswered.

When do you think we will next see a deficit under £100bn?

Why does that matter?

2% compound growth on £2tr soon makes that an irrelevance

rick_chasey

^^ and that’s before inflation

rick_chasey

I guess it distracts from the ideological hill of not extending free school meals for kids in families in poverty to out of school during rona.

Tories could always enact policies to improve the chances of the poorest to make it themselves to begin with, but that aside it’s a big stand for less than a rounding error in cost

rick_chasey

You do wonder what the priorities are

rjsterry

surrey_commuter said:

rjsterry said:

And for the OMG-this-is-unprecedented crowd.



Turns out building an empire requires lots of borrowing, mostly paid off by asset stripping that empire.

I am becoming fixated by this graph and your OMG unprecedented comment.

The precedents on that graph are the Napoleonic wars followed by a century of debt reduction before two world wars and half a century of deficit reduction. Now we are inexorably heading towards 150% due to our politicians being self serving cvnts.
My argument is if had the same calibre of politicians in the 1800s then we would have gone into WW1 at 200% debt and come out of WW2 with 600%.

I asked a question further up that went unanswered.

When do you think we will next see a deficit under £100bn?

All that pre-1900 borrowing was the cost of building an empire. Post-1900, it's the cost of attempting to defend it and then dismantling it, plus the establishment of the welfare state. I'd also argue that the apparent reduction in borrowing during the latter 19th century is actually the massive expansion of the UK economy during that period.
Notwithstanding that Johnson is a conservative in name only (I saw an article comparing him to Castro the other day), I think you have a very rose-tinted view of our previous politicians. I suspect that the lenders had far more of an impact on when and how quickly the debt was repaid than whichever bunch were in power at the time. I think if we had already been that indebted at the start of WWI, history would have run a very different course. Bluntly we would not have put up much of a fight.

Looking at that graph (yes, of course it is missing most of 2020) I would guess that it will take between 50 and 150 years to pay off current borrowing. As for when we'll reduce our borrowing: when the lenders stop offering to extend.

surrey_commuter

rick_chasey said:

surrey_commuter said:

rjsterry said:

And for the OMG-this-is-unprecedented crowd.



Turns out building an empire requires lots of borrowing, mostly paid off by asset stripping that empire.

I am becoming fixated by this graph and your OMG unprecedented comment.

The precedents on that graph are the Napoleonic wars followed by a century of debt reduction before two world wars and half a century of deficit reduction. Now we are inexorably heading towards 150% due to our politicians being self serving cvnts.
My argument is if had the same calibre of politicians in the 1800s then we would have gone into WW1 at 200% debt and come out of WW2 with 600%.

I asked a question further up that went unanswered.

When do you think we will next see a deficit under £100bn?

Why does that matter?

2% compound growth on £2tr soon makes that an irrelevance

2% growth may have been possible pre-Brexit but now is a distant dream.

£100bn is 5% of GDP so not sure why that makes it an irrelevance

surrey_commuter

rjsterry said:

surrey_commuter said:

rjsterry said:

And for the OMG-this-is-unprecedented crowd.



Turns out building an empire requires lots of borrowing, mostly paid off by asset stripping that empire.

I am becoming fixated by this graph and your OMG unprecedented comment.

The precedents on that graph are the Napoleonic wars followed by a century of debt reduction before two world wars and half a century of deficit reduction. Now we are inexorably heading towards 150% due to our politicians being self serving cvnts.
My argument is if had the same calibre of politicians in the 1800s then we would have gone into WW1 at 200% debt and come out of WW2 with 600%.

I asked a question further up that went unanswered.

When do you think we will next see a deficit under £100bn?

All that pre-1900 borrowing was the cost of building an empire. Post-1900, it's the cost of attempting to defend it and then dismantling it, plus the establishment of the welfare state. Notwithstanding that Johnson is a conservative in name only (I saw an article comparing him to Castro the other day), I think you have a very rose-tinted view of our previous politicians. I suspect that the lenders had far more of an impact on when and how quickly the debt was repaid than whichever bunch were in power at the time. I think if we had already been that indebted at the start of WWI, history would have run a very different course. Bluntly we would not have put up much of a fight.

Looking at that graph (yes, of course it is missing most of 2020) I would guess that it will take between 50 and 150 years to pay off current borrowing. As for when we'll reduce our borrowing: when the lenders stop offering to extend.

I suspect the pre 1900 debt was paid back by the empire.

Biggest (arguably only) leader is the BofE and I agree that borrowing will not be curtailed until the lenders demand it. Where we differ is that I believe that by then we will be fvcked as debt servicing costs will spiral out of control and we will see savage spending cuts to fund the £100bn+ costs.

surrey_commuter

rick_chasey said:

You do wonder what the priorities are

fairly obvious it is to enrage the libs

rjsterry

surrey_commuter said:

rjsterry said:

surrey_commuter said:

rjsterry said:

And for the OMG-this-is-unprecedented crowd.



Turns out building an empire requires lots of borrowing, mostly paid off by asset stripping that empire.

I am becoming fixated by this graph and your OMG unprecedented comment.

The precedents on that graph are the Napoleonic wars followed by a century of debt reduction before two world wars and half a century of deficit reduction. Now we are inexorably heading towards 150% due to our politicians being self serving cvnts.
My argument is if had the same calibre of politicians in the 1800s then we would have gone into WW1 at 200% debt and come out of WW2 with 600%.

I asked a question further up that went unanswered.

When do you think we will next see a deficit under £100bn?

All that pre-1900 borrowing was the cost of building an empire. Post-1900, it's the cost of attempting to defend it and then dismantling it, plus the establishment of the welfare state. Notwithstanding that Johnson is a conservative in name only (I saw an article comparing him to Castro the other day), I think you have a very rose-tinted view of our previous politicians. I suspect that the lenders had far more of an impact on when and how quickly the debt was repaid than whichever bunch were in power at the time. I think if we had already been that indebted at the start of WWI, history would have run a very different course. Bluntly we would not have put up much of a fight.

Looking at that graph (yes, of course it is missing most of 2020) I would guess that it will take between 50 and 150 years to pay off current borrowing. As for when we'll reduce our borrowing: when the lenders stop offering to extend.

I suspect the pre 1900 debt was paid back by the empire.

Biggest (arguably only) leader is the BofE and I agree that borrowing will not be curtailed until the lenders demand it. Where we differ is that I believe that by then we will be fvcked as debt servicing costs will spiral out of control and we will see savage spending cuts to fund the £100bn+ costs.

Borrowing was at roughly £1bn in 1815, 200% of gdp. By the end of the century, gdp had quadrupled, reducing the same debt to 50% of gdp. Actual debt to gdp in 1900 was about 30%, so while undoubtedly the massive transfers of wealth out of India and the rest of the empire contributed, economic growth did the lion's share of that reduction versus gdp. The other interesting graph is interest rates over the long term - while there is short term fluctuation, the trend is clearly downward. We might come unstuck at some point in the future, but I am not convinced today's politicians are any worse gamblers than their forebears.

surrey_commuter

rjsterry said:

surrey_commuter said:

rjsterry said:

surrey_commuter said:

rjsterry said:

And for the OMG-this-is-unprecedented crowd.



Turns out building an empire requires lots of borrowing, mostly paid off by asset stripping that empire.

I am becoming fixated by this graph and your OMG unprecedented comment.

The precedents on that graph are the Napoleonic wars followed by a century of debt reduction before two world wars and half a century of deficit reduction. Now we are inexorably heading towards 150% due to our politicians being self serving cvnts.
My argument is if had the same calibre of politicians in the 1800s then we would have gone into WW1 at 200% debt and come out of WW2 with 600%.

I asked a question further up that went unanswered.

When do you think we will next see a deficit under £100bn?

All that pre-1900 borrowing was the cost of building an empire. Post-1900, it's the cost of attempting to defend it and then dismantling it, plus the establishment of the welfare state. Notwithstanding that Johnson is a conservative in name only (I saw an article comparing him to Castro the other day), I think you have a very rose-tinted view of our previous politicians. I suspect that the lenders had far more of an impact on when and how quickly the debt was repaid than whichever bunch were in power at the time. I think if we had already been that indebted at the start of WWI, history would have run a very different course. Bluntly we would not have put up much of a fight.

Looking at that graph (yes, of course it is missing most of 2020) I would guess that it will take between 50 and 150 years to pay off current borrowing. As for when we'll reduce our borrowing: when the lenders stop offering to extend.

I suspect the pre 1900 debt was paid back by the empire.

Biggest (arguably only) leader is the BofE and I agree that borrowing will not be curtailed until the lenders demand it. Where we differ is that I believe that by then we will be fvcked as debt servicing costs will spiral out of control and we will see savage spending cuts to fund the £100bn+ costs.

Borrowing was at roughly £1bn in 1815, 200% of gdp. By the end of the century, gdp had quadrupled, reducing the same debt to 50% of gdp. Actual debt to gdp in 1900 was about 30%, so while undoubtedly the massive transfers of wealth out of India and the rest of the empire contributed, economic growth did the lion's share of that reduction versus gdp. The other interesting graph is interest rates over the long term - while there is short term fluctuation, the trend is clearly downward. We might come unstuck at some point in the future, but I am not convinced today's politicians are any worse gamblers than their forebears.

It was the extraction of resources that drove the GDP growth.

In the same way our parents would have mortgaged themselves to the hilt in the 70s confident that in 5 years time their income would have doubled so making the debt insignificant. Now it would take the term of the mortgage to achieve the same income growth.

I would be amazed if politicians of yesteryear ran deficits for decade after decade as this phenomenon only started under Gordon Brown and has rapidly accelerated

Jezyboy

This would suggest that Gordon can't really take the claim for the fashion of chancellors running endless deficits...


Worrying about borrowing at the moment is a little bizzare to me. It's clearly going to be bad news and I imagine that there will be more bad news incoming.

surrey_commuter

Jezyboy said:

This would suggest that Gordon can't really take the claim for the fashion of chancellors running endless deficits...


Worrying about borrowing at the moment is a little bizzare to me. It's clearly going to be bad news and I imagine that there will be more bad news incoming.

Blair’s first term was a promise to stick to Tory borrowing rules. Look at your chart and guess when the 2nd term started.

Your chart is dated 2014 so dates after that are forecasts, would be interesting to overlay that with reality

pblakeney

Jezyboy said:

Worrying about borrowing at the moment is a little bizzare to me. It's clearly going to be bad news and I imagine that there will be more bad news incoming.

Worrying is indeed futile.
Being aware of the impending doom and preparing for it is not.