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Budget 2009: Britain's Debt Will Not Be Under Control Until 2032
Daily Telegraph (UK) ^ | 4/24/09 | James Kirkup

Posted on 04/24/2009 7:57:58 AM PDT by marshmallow

The unprecedented burden of public debt built up by Gordon Brown will not be brought under control for nearly a quarter of a century, economists have said.

Families could soon find themselves paying at least another £1,400 a year in tax as part of the Government’s attempts to bring public debt back under control, the IFS predicted.

It said there was a gap between the amount of money that would be raised by the tax measures in this week’s Budget and the amount the Government will need to fund its spending plans.

This secret “blackhole” could end up adding another £1,430 each year to the average families’ tax bill, it said.

The stark warning of a generation of austerity ahead came as Alistair Darling admitted he could not be sure his optimistic forecasts for a quick economic recovery would be realised.

“It is very difficult to be absolutely certain as to what will happen,” he admitted.

The Chancellor’s predictions for growth to resume by the end of this year and to reach boom levels again by 2011 have been widely questioned, with the International Monetary Fund suggesting the British economy would actually shrink next year - despite Mr Darling’s forecast of modest growth. “The crisis is far from over,” it said.

The IFS warned that despite the tax rises and spending cuts announced in the Budget this week, future chancellors would be forced to raise even more money to fill a “breathtaking” long-term hole in the public finances.

The scale of the problem is so great that even with years of tax rises and spending cuts, the national debt will not be low enough to meet Gordon Brown’s now-abandoned “sustainable investment rule” until 2032. This “golden rule” dictated that Government debt should not rise above 40 per cent of Gross Domestic.....

(Excerpt) Read more at ...

TOPICS: Business/Economy; News/Current Events
Fascinating story unfolding across the pond. There's talk of Britain's credit rating being downgraded, the cost of CDS's on government bonds is extremely high and they've just raised the tax rate to 50% on "high earners".

Tune in if you want to see what happens when a former world power goes the banana republic route. We could be seeing a preview of something coming our way.

1 posted on 04/24/2009 7:57:58 AM PDT by marshmallow
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To: marshmallow

Wishful thinking. They’re betting the farm that more business as usual will fix things... but the hole will only grow deeper as more investment flees the country and more Muslims, deadbeats, and welfare cases flood in.

When the shooting starts, then maybe we’ll wake up.

2 posted on 04/24/2009 8:00:46 AM PDT by snowrip (Liberal? YOU ARE A GUTLESS SOCIALIST LOSER WITH NO RATIONAL ARGUMENT.)
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To: marshmallow

Just send all your money to the government and they’ll return the amount you need.

3 posted on 04/24/2009 8:02:16 AM PDT by blam
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To: blam

Shows what happens when you run a welfare state with open borders. They need to wean some people, throw out some people and cut taxes.
But,,instead they are goind to drive out the high productive individuals. The entire finance industry could go elsewhere..and pay no UK tax. How can a country that is broke and has high taxes be the center of the financial world?

4 posted on 04/24/2009 8:07:42 AM PDT by Oldexpat
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To: marshmallow

We’re in for the same.

5 posted on 04/24/2009 8:09:28 AM PDT by b4its2late (Ignorance allows liberalism to prosper.)
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To: marshmallow
This is what happens when a benevolent government decided to make poor people into middle class people using the public pot. It can;t be done and it only ruins the economy for everyone. Egalitarianism is a lie.
6 posted on 04/24/2009 8:20:03 AM PDT by April Lexington (Study the constitution so you know what they are taking away!)
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To: marshmallow

Free stuff is expensive.

7 posted on 04/24/2009 8:21:06 AM PDT by Oldeconomybuyer (The problem with socialism is that you eventually run out of other people's money.)
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To: Oldeconomybuyer
A Stupid Question, but if the UK Government can say 2032, is our government saying when it's will back in balance? And if it is not giving a date, why aren’t we asking?
8 posted on 04/24/2009 8:29:09 AM PDT by sr4402
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