Bailouts could bankrupt Germany itself

The markets can't/won't get in the queue as we owe a fortune on them and we need to borrow off them to finance this years government spending which they won't or will put the interest rates up if they have no confidence that we have any intention/plan to pay the deficit back.

But, if we don't reduce the deficit (not the national debt - different issue) then we will need to borrow a lot of money next year to balance the books. We need to borrow that from the international capital markets, unless you can think of someone else with 50 billion plus kicking around?

So, telling the international capital markets to get in the queue while we keep spending is going to stop them from lending us any more money, or only doing it at a highly increased rate of interest.

We spend more money than we make every year. We're in no position to be snotty with the money lenders. When we're not running a deficit any more THEN we can look at the national debt and think about reducing that and the speed at which we should do that but we're not even in a position to think about that yet.

The international capital markets have the power at the moment because we owe so much money on them and they have the potential to push the interest rates on our Government bonds up and leave us needing the IMF.

So the international capital markets are more important than our own fellow citizens as far as I am concerned the international capital markets can get in the queue.

We need to eliminate the deficit to restore business and investor confidence in our economy, the international capital markets are not very forgiving once confidence is lost. Also the longer we have the deficit the more we will have to pay servicing the interest on it.

It does need to be reduced but nowhere near as fast and deep as we are doing the social damage and misery caused will be immense.

Those who caused the problems have got away scot free.

There is a very broad consensus that our structural deficit needs to be reduced, the EU,IMF,OECD have all said so. Add to that the BoE Governor/major business leaders as well as the tories,lib dems,ukip and some Labour figures as well.

Dont agree our debt is like a broken finger and the government is removing the arm at the elbow to cure it.

BTW the credit ratings agencies have a piss poor record of accuracy, Lehman Brothers comes to mind

We were on the credit rating agencies watchlist, have a structural deficit that is 12% of GDP and have annual debt interest payments of £40 billion rising to £60 billion in the next few years and that is with the austerity measures. The fiscal situation is dire and needs urgent action.

hudd, our debt has a 14 year maturity we are nowhere near as bad off as the Tories and Fib Dems say we are.

I agree the larger countries have been very bad for doing this and the complacency of politicians across Europe has been a very large contributing factor to the problem.

I would add that I don't think its fair to blame the euro for the crisis only for the threat of contagion. Many countries outside of the eurozone most notably this one have terrible problems with sovereign debt and structural deficits due to fiscal irresponsibility

If it suits the French to break the rules they will and they will cock a snoot (good eh :o ) at the commission. Only the small countries will "get a slap".

The first thing that needs to happen is the stability and growth pact needs to be adhered to no ifs no buts. The Commission needs to keep a far closer eye on each members sovereign debt far more closely than they have done.

hudd, that would be difficult, what connection at a fiscal level is there between Greece and Germany. At the time of the formation of the Euro Greece was in some aspects almost a third world country compared to Germany.

I think the benefits of an optimum currency area are obvious the problem with the euro is there hasn't been any coordination of fiscal policy between eurozone countries.

LFN for once I agree with you, The Euro which I never supported was a mistake the Eurozone economies are to diverse to be a coherent whole.

The Common Market was a great idea but the EEC is just a club to reward Politicos of the left and right and to support big business, multi nationals and special interest groups.

I don't think there's any chance of Germany needing a bailout. Their deficit isn't very high and they have fiscal consolidation plan being implemented. Add to that they've got a growth of more than 3%

We would still have free trade with Europe irrespective of being in or out. I would rather we were out, seeing the money that is wasted by the Commission and the Council.

YES! - Ladyb - have a look at byrel's post of 20.03.

It's very clear, very concise, and I think after a long session with a cold towel over your head, some of it might sink in.

fnarr.

Yes hit the nerve straight down the middle

did your historians take a vote btw?

also, are you sure that everyone who thinks you are seriously misguided is a rightwinger?

You might be surprised

I think the whole right/left political spectrum is simplistic and a very flawed way of looking at political ideologies. Its far better to look at whether an ideology is libertarian or authoritarian and its view of the market. Socialism and fascism are both totalitarian but have very differing views to the market.

Look, the consensus among historians is that Hitler was extreme right wing. Despite the name. You right wingers are seriously kidding yourselves. Elitism is the root of eugenics, as your man kindly demonstrated yesterday with his 'breeding' comments.

Also, to go back to what SWC was saying about those lovely cuddly lefties, the historical reality can't be pointed out too often.

I think she may have been reading this rather intersting post which describes the "dirty little secret" of the left - eugenics.

Extract:
" Prominent Fabians such as H G Wells and Webbs led the way in combining the ?progressive? ideologies of socialism and eugenics. It didn?t stop when Mosely quit the group either, while eugenics is now a dirty word, for a century the Fabians have sought, and sadly often succeeded, in undermining the traditional family, property rights and individual freedom. Their cause was, and still is, evil."

Grand people always know what's best for the little people. So what was it about National Socialists not actually being Socialists? That's hogwash unfortunately - you are kidding yourself.

( sorry, I couldn't post earlier because I was having the mother of all posting probs)

We seem to have moved a long way from the OP.

Longfingernails, on this (though possibly not on much else), I agree with you.