20 Nov National debt soars past £2 trillion, but we can manage it
f you look at the national debt as if it were a family credit card, then we are plainly in some fairly serious trouble.
Expenditure is exploding past income in reckless, unsustainable ways and a reckoning is around the corner. The bailiff is already licking his lips in anticipation. He’ll have the TV, microwave and nan’s old jewellery box in no time.
Another way of looking at it is as an investment in tomorrow. We are buying shares in our future selves.
If it is a credit card (it’s not) then it is one on which we set the terms and conditions and can alter the payback time.
Since we are only really borrowing from ourselves, it seems fair to assume that we are good for it. We’ll pay ourselves back (or let ourselves off).
Today’s debt figures are obviously bad. In October the government borrowed another £22.3 billion, taking the total for the year to £215 billion. That leaves the total debt, the national overdraft if you insist, at £2.08 trillion. To be clear: this is a lot.
Chancellor Rishi Sunak has an unenviable task, and if he gets it wrong, there is a chance that interest rates and inflation spiral. (Just now, deflation and low interest rates are a much bigger worry.)
But those worrying about how we pay all this off are missing the point. It wouldn’t be cheaper to stop spending. We would just be left with even worse bills and a totally bombed out economy later down the line.
What about the young people who will inherit this debt pile?
What about them. The point of the borrowing is to improve their inheritance, to leave the nation with a fighting chance of progress.
There is only one way out of this crisis.
Whack it on the government Visa. We’ll deal with the rest later.