Category Archives: budget deficit

House of cards

Screen Shot 2015-05-06 at 07.45.57Britain’s fragile, debt-ridden economy

British socialists are determined to

put an end to government ‘austerity’—that is, the policy of reducing the budget deficit from 10 percent of GDP to 5 percent, which has taken seven years to accomplish.

The British

live by the grace and favour of foreign lenders content to buy the country’s bonds at low interest rates.

However, lenders’ confidence that Britain is, to a degree, a haven

could easily change. The country would then have to earn its current standard of living, which it is in poor shape to do; and a sharp decline could lead to social unrest, leading to a further collapse of confidence.