UK national debt

[mattbrown]

one problem is, the pension should have risen with average life expectancy, when it was 1st introduced in the early 1900's it was seventy and back then life expectancy was lower, it needs to keep in line with life expectancy or everyone has to accept to pay more and/or receive less

 

[technodup]

Scrap the nhs

One of the better ideas I've heard in this forum.

One of the biggest black holes for our cash. Along with PFI. And pensions. And, and,...

Scrap the lot of it.

 

[JohnH]

one problem is, the pension should have risen with average life expectancy, when it was 1st introduced in the early 1900's it was seventy and back then life expectancy was lower, it needs to keep in line with life expectancy or everyone has to accept to pay more and/or receive less

You're absolutely right Matt, I'd forgotten about that -- we're living longer.

Greece and Italy have been mentioned as candidates for defaulting on their debt mountain, but guess who else is on the brink???

America is on the brink of a potential default, threatening military salaries and social security payments. How did the world's largest economy get here?

Why is America facing a debt crisis?
In short, because it is not allowed to borrow any more money. The US national debt cannot legally exceed a debt ceiling of $14.29 trillion (£8.86tn) – a seemingly huge amount, but one which was reached in May.

http://www.guardian.co.uk/business/2011 ... nd-answers

The US faces the prospect of a "catastrophe" as President Barack Obama stands firm against Republican demands for deep spending cuts without any tax increases as the condition for raising the country's borrowing limit and avoiding a debt default.

With Washington gripped by a growing sense that it may be too late to avert a crisis, the president has said he will give the increasingly rancorous negotiations until the end of next week to reach agreement on the terms for raising the US's $14.3 trillion (£8.9tn) debt ceiling.

The White House has said that if there is no agreement by 22 July, then discussion about budget cuts and taxes should be abandoned in favour of legislation dealing solely with raising the debt ceiling before the borrowing limit is reached on 2 August. But the Republicans have rejected legislation without agreement on budget cuts.

With European leaders also facing a potentially ruinous debt crisis, a leading Wall Street figure described the prospect of a US default as catastrophic.

http://www.guardian.co.uk/business/2011 ... ma-default

 

[Andy R]

If Greece can't get its citizens to pay their taxes and the EU/IMF won't lend them anymore money, I wonder what happens when a country becomes insolvent. Do all of the public sector's bills (including pensions, benefits and the wage bill) just stop being paid? Does the government just say "Sorry, that's it folks -- you're all on your own"? :?

This is some of what's already happening -


"TAXATION

Taxes will increase by 2.32bn euros this year, with additional taxes of 3.38bn euros in 2012, 152m euros in 2013 and 699m euros in 2014.
A solidarity levy of between 1% and 5% of income will be levied on households to raise 1.38bn euros.
The tax-free threshold for income tax will be lowered from 12,000 to 8,000 euros.
There will be higher property taxes
VAT rates are to rise: the 19% rate will increase to 23%, 11% becomes 13%, and 5.5% will increase to 6.5%.
The VAT rate for restaurants and bars will rise to 23% from 13%.
Luxury levies will be introduced on yachts, pools and cars.
Some tax exemptions will be scrapped
Excise taxes on fuel, cigarettes and alcohol will rise by one third.
Special levies on profitable firms, high-value properties and people with high incomes will be introduced.

PUBLIC SECTOR CUTS

The public sector wage bill will be cut by 770m euros in 2011, 600m euros in 2012, 448m euros in 2013, 300m euros in 2014 and 71m euros in 2015.
Nominal public sector wages will be cut by 15%.
Wages of employees of state-owned enterprises will be cut by 30% and there will be a cap on wages and bonuses.
All temporary contracts for public sector workers will be terminated.
Only one in 10 civil servants retiring this year will be replaced and only one in 5 in coming years."

....................................

I don't know what will happen any better than anyone else does (this goes without saying) but imagine that I was an employee of, say, ΚΤΕΛ (KTEL, the national bus company) and not only found my wages cut by 30%, just like that, but also that I would have to pay hugely higher taxes on everything and that I'd been shafted out of my pension too. Damn right I'd be there in Syntagma Square demonstrating. I'd have to face those Greek riot police though and they are mean, hard bastards. Not the "normal" police but the ones in military green with their CS gas......

It's about time that the media rid themselves of this attitude that the average Greek is lazy and work-shy and that all they want to do is riot in Athens. In reality they're no different to the rest of us, it's just that things have reached breaking point sooner in Greece than here. It'll happen to us all though, one way or another.


Anyway, enough rambling from me. At least on the IoM I can just about afford to run a car (fuel is cheaper than in Greece, road tax and insurance too), I can earn more than I could doing the same sort of menial jobs in Greece and food (from a supermarket, at least) is cheaper here too.

 

[MikeD]

I've read in a number of places that Greece isn't terribly good at collecting taxes from self-employed people, with the result that enormous numbers of Greeks are self-employed. True/false?

 

[Andy R]

I've read in a number of places that Greece isn't terribly good at collecting taxes from self-employed people, with the result that enormous numbers of Greeks are self-employed. True/false?

Out of large towns and cities then yes, there are probably a higher percentage of people who are self-employed than, say, here or in the UK. As Greece is still largely a cash society, it's probably fair to say that a sizeable proportion of what these self employed get paid for work/services goes into their back pockets - same as anywhere really, I suppose. As times get harder this situation isn't going to "improve" either.

The people hardest hit by all these new austerity measures will be the likes of state owned company employees (bus, rail, electricity generation and distribution, OTE (the telecoms provider) etc) and anyone whose salary is paid directly to their bank account as they don't have the opportunity to do any "cash in hand" work nor can they hide their actual salaries from the taxman.

Those least affected are probably a typical country village inhabitant who has fingers in a few pies - maybe has a few hundred olive trees, some goats and sheep, some poultry, maybe a pig or two. If he's near the coast he'll maybe do a bit of fishing too. At least they can grow a lot of what they eat, unlike the city dweller, although as most of them seem to have inherited at least one house (other than the one they live) in the increased taxes on second and third homes will hit them, I suppose.
But like anywhere there's no escaping energy and road fuel costs - petrol prices were already higher in Greece than here (and ours are higher than the UK) and fuel duty increases will push them up even further.
Electricity was cheaper than here (I think we have the highest electricity prices in Europe :roll but who knows what will happen?

 

[dyna-ti]

Death of an empire .As seen from within.

 

[zigzag]

Superb article re: Greece. Long but worth reading:

http://www.vanityfair.com/business/feat ... nds-201010

 

[makster]

If we're as fooked as Greece, then I'm off to Greece. The weather's perfect, and the food is lots better

 

[1duck]

This is why we need to go off grid, looks like those american nut jobs were right all along.

The closer you are to self sufficient the better, buy land they aren't making anymore of that.