What George Osborne isn't telling you, and doesn't want you to know.
 

George Osborne’s deficit reduction plan requires unprecedented binge in personal borrowing

"The public will have to go on a £360bn borrowing binge to make George Osborne’s deficit reduction plans add up, an analysis by The Independent has found.

According to the small print in the latest report from the Office for Budget Responsibility (OBR), the public is forecast to add to its pile of unsecured lending, which includes credit card debt and bank overdrafts, by £360bn over the next five years.

If the public fails to spend, then growth would collapse and the Government’s deficit would be likely to start increasing again.

The £360bn figure represents a £41bn increase on the OBR’s forecasts just nine months ago and would take households’ unsecured lending, as a share of total household incomes, to a record 55 per cent by 2020. That would be well above even the pre-financial crisis unsecured debt ratio of 44 per cent."


The indy.

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

Nothing new. His original deficit reduction plan involved an expansion of private debt too.

EDIT: Oh look, big expansion in mortgage debt thanks to a nice fat increase in house prices. Keep wages down, feed the property spivs, expect people to borrow to spend. Excellent way to run a rentier economy.

---------- Post added at 15:01 ---------- Previous post was at 14:49 ----------

Wonder what the Bank of England will think of this? They have been trying to calm borrowing, at least in the mortgage market, down. Their usual response to too much credit in the economy would be to raise interest rates however with so much borrowing and so many mortgaged to the hilt that would be potentially disastrous.

Raising interest rates would also of course slow growth and reduce the already very low inflation.

As inflation is so low debt, both public and private, is doubly bad as it can't be inflated away. The very high interest rates and inflation of the past were horrendous shocks but quickly inflated away debt by reducing its value relative to wages.

No such option now. The only way to raise inflation that I can think of would be to perform a QE operation and push money into the real economy rather than buying government debt from banks who then sit on the cash and use it for cheap (actually they got paid to take it) recapitalisation.

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

I read in one newspaper that the way Osborne is going, it will take the country back to the day's of the Jarrow marches.

I look at it this way, Osborne is looking after his rich friends. Everyone else can go to hell.

On Thursday, it was stated again, in the newspapers that Contracts for NHS are now going to tender, and the one person in the lead to get a major contract. Is a company that it run by a millionaire who pours money into the Tory coffers. Now if that doesn't tell you something.

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

Provides some counterbalance to the £millions poured into the Labour coffers by the NHS unions amogst others.

TBQH I don't care a fig who provides the health care so long as its the best price for the tax payer, of the highest standard, free at the point of delivery and to each according to need.

Or maybe you'd like to pay twice as much tax and have the NHS run by the unions?

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

it is like all politicians when you see their lips move you know they are telling lies !

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

IIRC correctly they said with Kennedy that the more he lied the more his head tilted over.:D

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

Well why shouldn't they? Labour was formed by the unions to provide a counterbalance to the Conservative party.Seems eminently sensible for them to do so..Are you worried about undue influence from the unions? Well how can that be worse than the undue influence of multi millionaires and large multi global businesses who donate to the Conservatives? :erm:

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

Well said and moreover, who do you think has the most power and influence in today's society: the unions or the rich/big business?

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

Unfortunately it is whoever has control of the media..:(

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

And 90% of them support just one political party.

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

Odd that New/Old/Old New/Same Old Labour ever managed to obtain and retain power for 13 years then... ;)

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

Tories were just that bad, and Labour had a really well presented message via Tony Blair.

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

Yes they were. All that corporate money and control of the media didn't achieve much then did it. All it took to overcome was a message that people wanted to hear and a whole lot of lies and spin. :D

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

Whoring themselves out to the media helped a ton as well of course. Becoming more corporatist really helped New Labour.

Shafted most of the rest of us of course.

Re: What George Osborne isn't telling you, and doesn't want you to know.
 

So with our current account deficit continuing to ride high basing a large proportion of economic growth on debt-funded consumption doesn't seem the smartest thing to do.

It would be worse still if not for selling incredibly expensive property abroad, and at some point we'll run out of that and in the interim are exporting money to foreign landlords.

Running an economy for political ends is a really bad idea. The Chancellor continues to be overtly political in his aims and far too many economic policies were in this government geared towards re-election rather than sustainability.