|Picture of £1 trillion by the Daily Mail|
For the first time in figures announced this morning the UK National Public debt has passed a trillion pounds (for pedants, this is a thousand billion, not a billion billion).
This is quite some number, when Tony Blair and his merry band of lunatics took over in 1997, the national debt for £350 billion pounds. During the past 15 year the debt has grown by nearly 200% (ah, the power of compound interest! Inflation alone at an average of 3% for that period would imply an increase of nearly 60% in the debt) - so from 1997 if we had kept UK spending flat and incurred no more debt today we would expect Public Debt to be about £560 billion.
Instead the Country has about £460 billion of extra debt that we have incurred. Sadly, I can see little evidence during my adult life that this has been spent at all well. Some schools and hospitals have had money spent on them, but there are no new airports, railways, publicly built ports. Infrastructure indeed seems to have been forgotten, true investment ignored. What is clearer when you also look at Government spending is the inexorable rise of Social Security, from less than 15% to nearer 30% of all Government spend. This is all a real terms rise, and unfortunately accounts for a huge chunk of the extra debt taken on.
Labour have bequeathed the Country an underclass and benefits addicted population - on the plus side, getting this under control could mean a brighter future for the UK. However, there are few signs of this really happening, with the current hand-wringing lefties in the Lords decrying that families receive benefits to the same value of higher rate taxpayers who work full time - as if this is some sort of moral crime. This money is borrowed and spent, not invested for the future, it is true hand-to-mouth existing at the expense of future generations of taxpayers.
As we print our own currency, the UK cannot default, what we can do though is debase our currency. Already we have seen the fastest and deepest devaluation in 200 years since the 2008 onset of recession. At the rate our current policies are progressing, I can't see this being turned around anytime soon. Britain will be a nation getting poorer and poorer for the foreseeable future. If you do have investments, then Sterling denomination isn't for you.
Even as I write, the Pound is retreating against the Euro - yes, that benighted currency on the verge of collapse - not a very auspicious sign, that.