Thread: Britain is Bankrupt

Jim Rogers explains why Britain is bankrupt. UK government delays drastic expenditure cuts till the very last moment when the market forces them. It's a very unpopular move especially for all those dependent on government payrolls. Politicians who support it risk destruction of their careers.



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Bankrupt Britain

Heres a few facts I dug out after reading a distressing article on the BBC News website.

- The most commonly used threshold of low income is a household income that is 60% or less of the average (median) British household income in that year. The latest year for which household income data is available is 2008/09. In that year, the 60% threshold was worth: £119 per week for single adult with no dependent children; £206 per week for a couple with no dependent children; £202 per week for a single adult with two dependent children under 14; and £288 per week for a couple with two dependent children under 14. These sums of money are measured after income tax, council tax and housing costs have been deducted, where housing costs include rents, mortgage interest (but not the repayment of principal), buildings insurance and water charges. They therefore represent what the household has available to spend on everything else it needs, from food and heating to travel and entertainment.

- In 2008/09, 13½ million people in the UK were living in households below this low-income threshold. This is around a fifth (22%) of the population.

- More than half of all low-income households are paying full Council Tax, noticeably higher than in the mid-1990s.

- The UK has a higher proportion of its population in relative low income than most other EU countries: of the 27 EU countries, only 4 have a higher rate than the UK. The proportion of people living in relative low income in the UK is twice that of the Netherlands and one-and-a-half times that of France.

- Over the last decade, the poorest tenth of the population have, on average, seen a fall in their real incomes after deducting housing costs. This is in sharp contrast with the rest of the income distribution, which, on average, has seen substantial rises in their real incomes. The richest tenth of the population have seen much bigger proportional rises in their incomes than any other group.

And yet here we are, after a horrific recession and controvosies regarding bankers bonuses we’re still seeing banks dish out bonuses of up to 7 billion pounds!

Link.