You might think this is an incendiary headline, but really it only reflects the growing consensus among neutral observers of the UK's fiscal position.
Even Guido is reporting what Mervyn King said yesterday to the House of Commons Select Committee. Effectively, the UK is on an unsustainable spending spree. Worse, it was on one before the crisis started.
The OECD predicts the UK will have the worst fiscal deficit next year in the Western world, worse that Iceland and Ireland. Iceland has already been bailed out by the IMF and Ireland by the EU (under the radar). yet the UK is worse set to spend more.
Mervyn suggests that printing money and huge guilt sales are being accepted by the markets now as the price of avoiding total financial meltdown. but the time will come soon when they demand an end by forcing up interest rates.
The major ratings agencies too have the UK on watch for downgrade, which really seems inevitable and will push our debt burden up further.
All eyes are actually on the election next year. Outside observers expect the Tories to win and implement massive spending cuts. Only this will avoid an IMF bailout (unless there is some huge recovery turn around in the meantime, which is unlikely to say the least).
If Labour are re-elected then the IMF will storm the treasury immediately, via a collapse in the Gilts bond market - this is nailed on now with Gordon Brown going on about spending ever more money in a make-believe utopian socialist fantasy.
The reality is now that the 'money' being 'spent' now is mainly printed:
Extra Government debt estimated to be taken on this year - £170 billion
Money to be printed by the Bank of England - £150 billion
What a mess.
I think the saddest thing, is just like personal debt, everything can seem fine until the end, when the bailiff's come round and you lose your house and all your possessions. Until then the mirage can be maintained. I think this macro level shock it is going to come as a big surprise in 2010 to most people in the UK.