The UK's Debt

Britain's Economy

The economy of the United Kingdom is the seventh-largest national economy in the world and the third-largest in Europe measured by nominal GDP (after Germany and France) .

The UK entered its worst recession since World War II in 2008.





Why do we use GDP?

When national debt is shown in pounds sterling the National Debt looks huge. 

But by comparing national debt as a percent of gross domestic product (GDP) in, you get a look at government debt compared to the size of the economy at the time.

The UK National Debt

Every year the Government spends more money than it can tax (a budget deficit.), so we fill this gap by selling bonds to investors at home and abroad.

These bonds - known as gilts - have to be repaid in full, with interest. Added together, our unpaid loans make up the UK's national debt.



The History of UK national Debt

The National Debt began when William III engaged a syndicate of City merchants to market an issue of government debt.


England needed to rebuild herself as a global power after the 1690 defeat in the Battle of Beachy Head. And to be a global power, England had to build a powerful navy.

With no public finance available, and the credit rating of William III.'s government was so low that it was impossible for it to borrow the £1,200,000 that the government wanted.

To encourage City merchants to lend money to the Government,  long-term banking privileges including the issue of notes were offered to the merchants. The merchants came together and called themselves the Governor and Company of the Bank of England.

The Bank of England raised the £1.2m was raised in 12 days...

The National Debt began the 20th century at about 30 percent of GDP. It jerked above 150 percent in World War I and stayed high. Debt breached 200 percent during World War II. Debt declined to 50 percent of GDP by the 1970s and dipped to 25 percent by 1990.

The National Debt began a rapid increase in the aftermath of the worldwide financial crisis of 2008.







Whats the Risk?

The real risk from government debt is interest payments on debts. Experts say that when interest payments reach about 12% of GDP then a government will likely default on its debt.

The peak period for government interest payments was in the 1920s and 1930s right after World War I.


The Future

According to Government estimates the UK's national debt will rise to £1,214 Billion in 2015.  In 2011, the UK's national debt is £909.2 Billion.







Graphs from http://www.ukpublicspending.co.uk

What is Left wing, Right wing and 'Centrist' politics?

What is Left and Right wing politics?

In political discussion pages and forums around the world, the insults of ‘loony left’ and ‘rabid right’ are often thrown about.

But what is left and right winged politics?

LEFT WINGERS

Left wingers believe that governments are a force for social justice and change, and so should intervene in individual’s lives to ensure social justice is achieved. 

For this reason left wingers have traditionally favoured ‘big’ government while right wingers favoured ‘small’ government.

Left wingers believe in substantial equality. They argue that not every individual is the same and so government policy should be aimed to create substantial rather than just formal equality. Examples of left wing substantial equality includes affirmative action and social and cultural rights.

RIGHT WINGERS

Right wingers believe that governments are big and unwieldy and so should not interfere with people’s lives at all. They believe that government interference contravenes an individual’s right to liberty.

For these reason right wingers favoured ‘small’ government

Right wingers believe in formal equality. They believe that everyone should be treated equally under the law and should be treated equally by government. Examples of right wing formal equality include equal pay for equal work and civil and political rights.

ECONOMICS RIGHT

"Right-wing" has sometimes been used to describe laissez-faire capitalism. In Europe, capitalists formed alliances with the Right during their conflict with workers after 1848. In France, the right's support of capitalism can be traced to the late 19th century.

The so-called neoliberal right, popularized by Ronald Reagan and Margaret Thatcher, combines support for free markets, privatisation, and deregulation with traditional rightist beliefs.

Ronald Regan and Margaret Thatcher
were economically right of centre.

ECONOMICS LEFT

Leftist economic beliefs range from Keynesian economics and the welfare state through industrial democracy and the social market to nationalization of the economy and central planning. During the industrial revolution, left-wingers supported trade unions. In the early twentieth century, the Left were associated with policies advocating extensive government intervention in the economy. Leftists continue to criticize what they perceive as the exploitative nature of globalization, the race to the bottom and unjust lay-offs. In the last quarter of the Twentieth Century the belief that government (ruling in accordance with the interests of the people) ought to directly involve itself in the day to day workings of an economy declined in popularity amongst the center left, especially social-democrats who became influenced by 'third way' ideology.

Clement Attlee's post World War 2 Government put in place the post-war settlement, based upon the assumption that full would be maintained by Keynesian policies, and that a greatly enlarged system of social services would be created – aspirations that had been outlined in the wartime Beveridge Report. 

Within this context, his government undertook the nationalisation of major industries and public utilities as well as the creation of the National Health Service. After initial Conservative opposition to Keynesian fiscal policy, this settlement was broadly accepted by all parties until Margaret Thatcher became Prime Minister in 1979.

Clement Attlee was
 left of centre economically

Ok a little bit of history here..

THE HISTORY OF THE LEFT

The term left wing derives from the French Revolution, as radical Montagnard and Jacobin deputies from the Third Estate generally sat to the left of the president's chair in parliament, a habit which began in the Estates General of 1789. 

Throughout the 19th century in France, the main line dividing left and right was between supporters of the French Republic and those of the Monarchy. The June Days Uprising during the Second Republic was an attempt by the left to assert itself after the 1848 Revolution, but only a small portion of the population supported this.

In the mid 19th century, nationalism, socialism, democracy, and anti-clericalism became features of the French Left. After Napoleon III's 1851 coup and the subsequent establishment of the Second Empire, Marxism began to rival radical republicanism and utopian socialism as a force within left-wing politics.

The influential Communist Manifesto by Karl Marx and Friedrich Engels, published in 1848, asserted that all human history is the history of class struggle. They predicted that a proletarian revolution would eventually overthrow bourgeois capitalism and create a classless, stateless, post-monetary society.

In the United States, many leftists, social liberals, progressives and trade unionists were influenced by the works of Thomas Paine, who introduced the concept of asset-based egalitarianism, which theorises that social equality is possible by a redistribution of resources.

More recently in the United States, left-wing and right-wing have often been used as synonyms for Democratic and Republican, or as synonyms for liberalism and conservatism. 

THE HISTORY OF THE RIGHT

The political term right-wing originates from the French Revolution, when liberal deputies from the Third Estate generally sat to the left of the president's chair, a habit which began in the Estates General of 1789. 

The nobility, members of the Second Estate, generally sat to the right. In the successive legislative assemblies, monarchists who supported the Ancien Régime were commonly referred to as rightists, because they sat on the right side. 

A major figure on the right was Joseph de Maistre, who argued for an authoritarian form of conservatism. 

Throughout the 19th century, the main line dividing Left and Right in France was between supporters of the Republic and supporters of the Monarchy. 

On the right, the Legitimists and Ultra-royalists held counter-revolutionary views, while the Orléanists hoped to create a constitutional monarchy under their preferred branch of the royal family, a brief reality after the 1830 July Revolution.

The left, right, and centre are often associated with socialism, conservatism, and liberalism. Some historians and social scientists seek to reduce political beliefs to class, with left, right, and centre politicians representing the working, upper or middle classes. Seymour Martin Lipset for example describes modern political parties as a consequence of "democratic class struggle". 

Others draw attention to the role which religious, ethnic, and regional differences play in democratic politics. 

According to The Cambridge History of Twentieth-Century Political Thought, the Right has gone through five distinct historical stages: the reactionary right, which sought a return to aristocracy and established religion; the moderate right, whose watchwords were limited government and distrust of intellectuals; the radical right, which favoured a romantic and aggressive nationalism; the extreme right, associated with anti-immigration and implicit racism; and the neo-liberal right, which combined a belief in a market economy and deregulation with the traditional Right's beliefs in patriotism, elitism and law and order. 

British conservative scholar R. J. White rejects egalitarianism, stating: "Men are equal before God and the laws, but unequal in all else; hierarchy is the order of nature, and privilege is the reward of honourable service”. 

American conservative Russell Kirk also rejects egalitarianism as imposing sameness, staying: "Men are created different; and a government that ignores this law becomes an unjust government for it sacrifices nobility to mediocrity".

Libertarians rejects collective or state-imposed equality as undermining reward for personal merit, initiative, and enterprise. In their view, it is unjust, limits personal freedom, and leads to social uniformity and mediocrity.

Libertarians often reject being described as left or right. Leonard Read claimed that these terms were "authoritarian". According to Harry Browne, "We should never define Libertarian positions in terms coined by liberals or conservatives, nor as some variant of their positions." Walter Block also rejects these labels.

Third Way (centrism) 


The Third Way promotes economic growth, entrepreneurship, enterprise and wealth creation but it is also in favour of greater social justice and it sees the state playing a major role in bringing this about.




It emphasizes commitment to: 
- balanced budgets, 
-providing equal opportunity combined with an emphasis on personal responsibility, 
-decentralization of government power to the lowest level possible, encouragement of public-private partnerships, 
-improving labour supply, investment in human development, protection of social capital, 
-protection of the environment. 




THE HISTORY OF CENTRISM


In 1938 Harold Macmillan wrote a book entitled The Middle Way, advocating a compromise between capitalism and socialism, which was a precursor to the contemporary notion of the Third Way.
Former Prime Minister Tony Blair is cited as a Third Way politician.
According to a former member of Blair's staff, Labour and Blair learnt from, and owes a debt to, the Bob Hawke's government in Australia in the 1980s on how to govern as a 'third way' party. 

Tony Blair is cited as
a Third Way politician.

By Alan Wyllie
Source Wiki & my memory. All mistakes are mine.