December 2022
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The West’s welfare states are unaffordable – but our politicians are afraid to tell us as they want to keep their jobs

Investing genius Warren Buffett is credited with saying that it’s only when the tide goes out that you discover who has been swimmig naked. Many people seem to think that the 2007-2015 financial crisis is a difficult but temporary event that will soon be forgotten as the world’s economies start to grow again. In fact, it’s equivalent to the tide going out and exposing that most Western democracies are naked and bankrupt. Their politicians have borrowed and borrowed and borrowed to keep up the illusion we can afford the welfare state where almost everyone gets benefits and tax credits and healthcare and pensions and housing and schooling and much more, supposedly paid for by other people. 

There was (perhaps surprisingly) an excellent article in the  Sunday Telegraph yesterday

In it, columnist Janet Daley argues that the financial crisis has exposed the Western welfare state as being unaffordable – you cannot have a society where most people expect to take more out than they put in. But no politician dares admit the truth as they know they won’t be elected. So they all lie to cover up their nakedness in the hope of getting into power and then they tinker at the edges of the economy, trying to look like they’re doing something but not really changing anything, to avoid civil unrest and keep their jobs. Meanwhile the rats – politicians, bureaucrats, eurocrats, business bosses, BBC executives and bankers – all loot the sinking ship for as much money as they can before the stupid, X-Factor-obsessed public realises what’s going on.

Under Labour, our debt reached over £700bn. Under the Coalition it’s going to hit £1.4trn. One day, we wil have to start paying this back. This means an extremely painful adjustment as the majority of us will have to take less from government than we put in. And even if we managed to start paying back our debt at £10bn a year, it would take 70 years to get back to where we were when the Coalition took over and 140 years to be debt-free like Australia, Canada, New Zealand, Norway and others.

So, prepare for at least 140 years of austerity. Oh, yes and have a great Christmas. Hopefully you’ll get a lot of money in your Christmas stocking as you’ll need it to pay for the 33% increase in taxes that was in the small print of Osborne’s last budget.

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