In the previous part of this series we examined George Osbourne’s claims about the scale of the National Debt, and saw that, relatively speaking, the UK has in fact been in far worse economic situations. This time we continue our examination of the real state of the British economy.
Once again they do, kind of, have a point, paying off the interest on a loan is pretty much just throwing money away, and obviously isn’t an ideal situation; nobody takes on debt without good reason! However, if one looks below this veneer of truth we can once again see that the situation isn’t as clear cut as the Govt would have us believe.
Over the past decade interest payments have, as a percentage of GDP, been at their lowest for about 100yrs, for all that the last Govt made many mistakes during their time in office one of their big achievements was to reduce this constant drain on the public purse; it was only around 2008, when recession, and the necessity of bailing out the banks, hit us that Interest payments on the National Debt started to rise significantly again, and even now the figures are still lower than they’ve been for most of the past century.