A Trillion Reasons for Change
A Trillion Reasons for Change?
We hear a lot about the national deficit but rather less about the national debt. The national deficit represents an annual figure that just adds to the overall national debt. According to an ONS (Office for National Statistics) and Treasury publication on 18th March, the net borrowing or deficit for the 10 months from April 2009 to February 2010 was a staggering £131.9 billion.
The national debt at the end of February 2010 was £857.5 billion or 60.3% of our country’s entire GDP (gross domestic product). This figure is rising all the while that we have an annual deficit. The Labour Government is apparently committed to halving the deficit by 2014 meaning that the national debt will continue to increase. At its current rate of increase, the national debt could be an incredible one trillion pounds during 2011.
What does a British trillion pounds look like? A billion is one thousand million and a trillion is one thousand billion. So figuratively we have a prospective national debt reaching and exceeding £1,000,000,000,000 in the near future. I hope that fits a column.
We have this horrific national burden for ourselves and future generations. New citizens of Britain will assume that status alongside a mass of borrowing that they had nothing to do with. It is like opening your first current account with a bank and instead of them giving you a credit, you start with a very large negative balance.
The future could be bleak unless we get real about the economy. That requires a government ready to describe the challenge as it is and not to give us some puerile spin about “halving the national deficit”. As we have seen, that measure will not be enough. It is just tinkering at the edges of a huge problem that will cascade down the generations.
A new government needs to look at the biggest departmental budgets and find the savings that will make the necessary difference. This will require tough decisions which could also apply in the area of taxation. It is hard to imagine that such action will command universal popularity but doing nothing or doing too little has much worse consequences for all of us.
As individuals, we cannot live beyond our means indefinitely. There comes a point when the game is up. The same applies to countries. It is no good saying that we can borrow from another institution or country. Who are they borrowing from and who are their lenders borrowing from? Ultimately the debt is called in from somewhere.
Bob Lanzer, Leader of Crawley Borough Council
24th March 2010