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To whom do we owe the national debt? Has every country got one?
Margaret Diamond, Binley, Coventry
- The National Debt is the total exports minus the total imports, and isn't an actual debt, but more correctly called a "balance of trade".
In theory, the worldwide total should be zero, but apparently it's around a debt of $100,000,000...Benjy Arnold, London, UK
- We owe it to ourselves.We as taxpayers (if we pay any tax) owe the national debt to ourselves (as savers ? if we have any savings). If you have savings in a bank, for example, some of that money may be invested in government bonds (gilts). You are even more likely to be owed some of the national debt if you have a pension, some of which will probably be invested in UK government debt.
This simplification ignores the fact the citizens of one country can invest in the government debt of another country. A lot of US government bonds (treasuries) for example are held by foreigners. Some poorer countries also have international debt ? but not as much as you might think for all the talk of a third world debt crisis. Even in this age of global capital, most government debt is owed to domestic investors in most of the world. Turkey, for example, has a big national debt, but it is financed mostly by Turkish savers.
It is perfectly possible for a country to have no national debt. Luxembourg springs to mind. And some oil-rich countries, Norway and Brunei I think, have put aside money now for the day the oil runs out. But since governments ? even more so than individuals ? can rarely resist the urge to spend it while they?ve got it, almost all countries have a national debt not a natinoal investment fund.
Michael Peterson, Westcliff-on-Sea UK
- if we owe ourselves the national debt. why don't we simply let ourselves off.?
Peter Edgerton, whitchurch ENGLAND
- Margaret,The National Debt is NOT owed to us, it is owed to private banks who control our central bank the Bank of England. This is due to the fractional reserve monetary system which perpetuates by creating a society of debt out of nothing. Money is created on a computer, this is a crime if you are a private citizen but not a banker, and when it is in the system it can be re-lent up to 9 times its original value. This de-values the money and leads to inflation. Crucially interest is charged to the government on this created money (the original loan if you like). This interest goes to private banks. One wonders how much of the tax we pay is going straight into these banks pockets? The big question is, why are we in this type of system when there are alternatives that are far better for UK citizens and the world populace? When you look at the complete lack of meaningful action against banks over the last 200 years the answer becomes apparent. A very small few stay powerful and wealthy. We are the ones that keep them in that position through our ignorance and subservience.
Eric Stone, Saffron Walden England
- As Eric Stone says, the National Debt is owed to the financial markets who lend credit, which they create themselves. In addition, they use the "gilt-edged" status of the Government bonds as security to create up to 9 times more credit which they lend to others such as the public and businesses. The UK pays in excess of £40 billion (in 2013) of interest which comes out of our taxes. When you think that the Chancellor has today said that he wants to cut £25 billion more in spending, he could think about saving the interest that we should not have to pay. There are countries such as Jersey and Guernsey which have no national debt, so the pay no interest. All this started with the Napoleonic wars when the government borrowed money to fund the war. Income tax was created to pay the interest ans the capital has just gone on growing and growing.Incidentally, trading in those bonds at the time of the Battle of Waterloo made the Rothschild family a fortune and became the major creditor of the UK Govenrment. Since then, the family of Lord Rothschild has continued to call the shots in Government and at the Treasury and the Bank of England¨.Debt-based money is the biggest single issue and the reason for the mess in which we find ourselves, really.
Paul, Junglinster Luxembourg
