The 2010 Emergency Budget thread

[Vague_Boy]

Comparing it to a Ponzi scheme is ridiculous, as is your suggestion it is illegal. Ponzi schemes are set up to fail.

 

Governments can do many things that would be illegal for you or I to contemplate.

 

None of this should come as a surprise. It is many years since experts began pointing out that Britain’s State pension – like most of its public sector pensions – are unfunded promises which rely on NICs and taxes paid by workers this week to pay pensions to old people next week.

 

This financial model is so fundamentally unstable that it is illegal in the private sector. No private company or insurer would be allowed to carry on as a series of British governments have done. Hence my disrespectful but I hope helpful comparisons with the original wheeze of the American fraudster, Mr Ponzi.

 

LINK

 

 

Now you might consider this to be mere op. ed. commentary, but don't forget to factor in the unfunded pension obligations of £4,771 billion (or six times the current national debt). Let's hope the next generation of taxpayers have deep pockets.

 

The figures Mr. Baker cited are truly worrying: official debt of £772 billion, itself a not inconsiderable sum, but utterly dwarfed by the government’s existing pension obligations, which raise the total to £4,771 billion, about six times as much. And, if you add in the obligations of the banks, now a ward of the state in more ways than one, you get a figure (using ONS data) of about £6.3 trillion or £6,300 billion – or if you prefer, £6,300,000,000,000. Figures of this magnitude have so many zeros they become incomprehensible, but to give this last figure a sense of magnitude, it is over four times UK GDP.

 

LINK

 

Bear in mind that Greece is in crisis with a debt only 125% of GDP. Imagine what kind of a crisis a debt to GDP ratio of 400% would precipitate.

 

Oh wait, you won't need to imagine it.....

[Alex C.]

Governments can do many things that would be illegal for you or I to contemplate.

 

 

 

LINK

 

 

Now you might consider this to be mere op. ed. commentary, but don't forget to factor in the unfunded pension obligations of £4,771 billion (or six times the current national debt). Let's hope the next generation of taxpayers have deep pockets.

 

 

 

LINK

 

Bear in mind that Greece is in crisis with a debt only 125% of GDP. Imagine what kind of a crisis a debt to GDP ratio of 400% would precipitate.

 

Oh wait, you won't need to imagine it.....

 

I've been looking for data on unfunded pension liabilities (thinking that you can't compare greeces 125% with a figure of 400% if the 125% doesn't include unfunded pension liabilities).

 

So far, I've only come across this on a anti-EU site. The PDF it links to as a source is now gone, and it is from 2003, but it provides an interesting overview - particularly given that Greece, Spain and Portugal all have had huge problems recently.

 

edit: it's possible that the UKs data is incomplete, as it doesn't even come to 100% of GDP...

 

I've also found this which seems to be well researched. This time showing that the UK's expenditure on pensions is below most other European countries (other than Luxembourg). Again, it's from 2003, but how much have our pension costs really risen in the last 7 years?

[Wildcat]

I've been looking for data on unfunded pension liabilities (thinking that you can't compare greeces 125% with a figure of 400% if the 125% doesn't include unfunded pension liabilities).

 

So far, I've only come across this on a anti-EU site. The PDF it links to as a source is now gone, and it is from 2003, but it provides an interesting overview - particularly given that Greece, Spain and Portugal all have had huge problems recently.

 

edit: it's possible that the UKs data is incomplete, as it doesn't even come to 100% of GDP...

 

Why would it? Uk national debt is around 60% a third what it was in the 1950s.

 

All these people hyperventilating about the debt are doing so to point score not for any sound reason. Yes the debt is high and needs to be reduced but there is no need to go about it the way the Tories are doing, in fact many believe that the way they are going about it will cause the economy damage.

[Wildcat]

Now you might consider this to be mere op. ed. commentary, but don't forget to factor in the unfunded pension obligations of £4,771 billion (or six times the current national debt). Let's hope the next generation of taxpayers have deep pockets.

 

Over the course of a lifetime that is less than £5billion a year, a drop in the ocean.

 

I personally think it pretty pathetic when a national newspaper has nothing better to do but whinge and be jealous over the costs of a pension that we rely on for our retirement.

[Wildcat]

I've also found this which seems to be well researched. This time showing that the UK's expenditure on pensions is below most other European countries (other than Luxembourg). Again, it's from 2003, but how much have our pension costs really risen in the last 7 years?

 

I can't think of any reason to think they have. The Tories are just blowing a lot of hot air lumping numbers into figures of our national debt and comparing them with countries where the figures aren't added to excuse their raid on the poor.

[Tony]

Why would it? Uk national debt is around 60% a third what it was in the 1950s.

 

It's not a proper comparison considering that the UK was servicing a huge debt to pay for five years of a crippling war, and that debt was only paid off a few years ago.

[BasilRathbon]

Here's a simple suggestion that could save a fortune. Why doesn't the government redefine the word billion to mean "a million million" as it used to, rather than "a thousand million" as it does now? At a stroke we could reduce a debt of, say, £1,000 billion to £1 billion!

 

Ooh, I should've been an economist, me.