Britain Poised For Economic Collapse

Posted on September 11, 2007
Filed Under Business, Politics, News |


Ah, the days when being more and more in debt was a sign of economic success! The days when “Prudence” Brown was steering the country through the reefs and whirlpools and storms of the global economy, one hand on the tiller of state and one eye on the legendary “moral compass”.

Well, perhaps Cap’n Gordon is more like Cap’n Bob and we are all going to have to jump overboard and drown in the Sea of Reality, attempting to use a raft of bouncing cheques as a buouy as we attempt to make landfall on Bankruptcy Island, where we will have to climb the Unacceptable Face of Mount Capitalism. Perhaps we are all becoming extras in an episode of Lost.

If your neighbour kept buying ever more flashy and expensive goods, you might be superficially impressed. If you found that he was funding all this on credit, you might think he was foolhardy. If another neighbour then sold him an expensive mortgage he could not afford and attempted to offload the debt onto you through trickery and subterfuge, you might think the world was going mad. If the government then announced that the economy was thriving and things were going to get better, you might think the lunatics had taken over the asylum.

So, welcome to the asylum, or the real world, or the world of dog eat dog or the jungle or whatever the juvenile fantasists who run things like to call it. The world where spending what you do not have is called economic sense. The world where activities which undertaken by an individual would be called irresponsible profligacy are paraded as sound economic management when undertaken by the state.

Timesonline has this:

Requests for help from households overwhelmed with debts have soared by 20 per cent in the past year, figures from Citizens Advice show.

The organisation received 1.7 million different inquiries about how to deal with mounting debts in the year to April, a record. The debt caseload now makes up one third of all its work and the organisation has almost run out of trained debt advisers.

Problems with debts run up on credit card and store cards dominate, accounting for almost half of all debt inquiries. However, Citizens Advice said that there was also a sharp rise in problems over day-to-day living expenses. Inquiries on how to handle gas and electricity arrears were up by a third, while queries about council tax debt rose by a quarter.

[…]

“These figures are worrying evidence that while many have enjoyed the benefits of the credit boom, a large and growing number of people continue to pay the price, becoming overwhelmed by serious debt that can have a devastating impact on their lives,” said David Harker, chief executive of Citizens Advice. He criticised credit companies for lending more cash to customers already in debt. He also urged credit companies to negotiate with customers rather than issue them threats of court proceedings.

Total debts accumulated by consumers stand at a record £1,354.6 billion, exceeding the value of the output of the entire economy which stood at £1,330 billion in mid-2007. Phillip Hammond, the Shadow Chief Secretary to the Treasury, said last night: “An economy built on borrowed money is built on borrowed time.”

So, Britain has become a country where the citizens owe more money than the total value which the country produces - a banana republic similar to Robert Mugabe’s current Zimbabwe.

Mr. Micawber, in Charles Dickens’ David Copperfield, summed it up by saying:

“Annual income twenty pounds, annual expenditure nineteen nineteen six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery”.

The reason Mr Micawber kept getting into financial difficulties was that he was forever writing promissory notes in the hope that when they came to maturity, he would have the money to pay them. He was forever hoping that ’something would come up’ and he was forever running out of luck.

The world has just run out of luck.


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Share This Tags: corporatism | deception | delusions | gordon brown | money

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