Comments by "Aden Wellsmith" (@adenwellsmith6908) on "Why we have a national debt" video.

@johnward514 Who is the debt owed to? One person/organisation has an asset. The other has a liability,. That's standard. Or do you have some radical new accounting approach? The Bernie Maddoff school of accounting perhaps.
3
Quantify the debts. I'll give you a hand with the broad categories. 1. Borrowing [2,478.17 bn] 2. State pension 3. Civil service pension 4. Unpaid wages 5. Unpaid invoices 6. The EU 7. Expected losses on insurance contracts 8. Expected damages (Post office, NHS etc) 9. Nuclear clean up (paid up front, state pays for the work) 10. Expected losses on guarantees. I've done the first for you. Can you do the others/
3
If you look up the "equation of exchange" it explains it. Double the money supply and prices double.
2
The biggy Murphy won't discuss. How much pension debt because that debt is inflation linked. Most, but not all of the borrowing is fixed rate. But that's only 8-9% of what is owed. The rest is almost all inflation linked. [Unpaid wages, unpaid invoices being the exception but that's small and very short term].
2
It's called screwing the young so Murphy can live the high life on the debt. He's owed a pension
2
The government taxes Joe £10. The government spends that £10. Where's the money creation? There is none. The £10 spend hasn't created any new money as you claim.
2
@stephfoxwell4620 That's the borrowing. What about the other debts like pensions? That's on top of the borrowing. So 30% of tax goes on the debts - plural. Austerity - caused by the debts Low take home pay - caused by the debts Wealth inequality - caused by the debts Pensioner poverty - caused by the debts Lack of investment - caused by the debts ....
2
@julianshepherd2038 Other evidence. If you look at local government accounts, pensions are a debt. If you look at company accounts, pensions are a debt. If you ask civil servants, are you owed a pension, they say yes. It's a debt. It passes the tests that state its a debt. Only people like Bernie Maddoff or Enron would say no.
2
@iwantagoodnameplease Because that transfers wealth away from the workers. So why is wealth inequality a good thing?
2
@OnlineEnglish-wl5rp So the equation of exchange. You're saying M3 has quadrupled for the housing. Then other goods on top increase that as well. Where's your evidence on M3 and its increase? You do know what M3 is?
1
@OnlineEnglish-wl5rp How does the government control the main banking ratio? That's liabilties / capital? You do know that this was reduced [rightly so] after 2008. So the evidence is that isn't the cause. It's interest rate policies and its migration that has massively increased the sale prices [not the monthly cost]. You need to ask, what's happened to the monthly costs for the average person in the process of buying a house.
1
@andielines You're welcome. Wikipedia has a reasonable intro to the equation of exchange if you want a starter.
1
The *equation of exchange* is the relation: $𝑀⋅𝑉=𝑃⋅𝑄$ where, for a given period, 𝑀 is the total money supply in circulation on average in an economy. V is the velocity of money, that is the average frequency with which a unit of money is spent. P is the price level Q is an index of real expenditures (on newly produced goods and services). Double the money supply (M), and prices (P) double. Inflation linked debt also doubles, unliked fixed rate debt. You cannot print your way out of inflation linked debt, you have to tax your way out. Taxation is limited by the size of economy, and the willingness of the population to accept taxation without corresponding services.
1
@stumac869 What about the other debts like pensions? You are saying no pensions wil be paid.
1
@Phil_D_Waller Socialist pensions [redistribution not investment based] produce the big debts.
1
@Phil_D_Waller mon pol?
1
@OnlineEnglish-wl5rp Whose told you its the banks? Ah the people hiding the debts. So property. There are two prices that people look at. What's the sale price is one, but in reality the real price is the monthly cost of the mortgage. That's what banks look at and that's what people use. It's how much can I afford a month and what does that mean as a sale price. Banks do this because they know that 30% of income is what they know leads to low default rates. So what drives the monthly costs? Interest rates. Who controls those? The state in the form of the BoE. Drive interest rates down, and asset prices go up. The second big factor on housing is migration. Pull in millions legal, illegal or asylum, and you get a major supply and demand issue. That pushes up prices. My view on the banks, is there are two types of event. Liquidity events and credit events. Liquidity events, the state insured banks for payments. They should step in as a lender of last resort. But if its a credit event because they have lost money on bad loans etc, let them go bust. Creditors take a hit over the level of deposit insurance. Bankrupt them in that case. So what motivates me? 1. Wealth inequality 2. Austerity 3. Lack of investment 4. Pensioner poverty 5. Low take home pay 6 . Accounting fraud. 7. Educating people as to the real cause, not what the people who have committed the fraud want them to believe. I don't want your money. Unlike the fraudsters.
1
@maria8809ttt What loopholes?
1
So why is 30% of tax going on the debts? That's the cause of austerity.
1
@stephfoxwell4620 Borrowing only. There's more to the debt that just the borrowing. Have you looked at the liabilities reported in the WGA in the small print? 1. Borrowing [2,478.17 bn] 2. State pension 3. Civil service pension 4. Unpaid wages 5. Unpaid invoices 6. The EU 7. Expected losses on insurance contracts 8. Expected damages (Post office, NHS etc) 9. Nuclear clean up (paid up front, state pays for the work) 10. Expected losses on guarantees. What are the liabilties or debts other than the borrowing? What are the debt servicing costs of those debts? Why would you believe the Tories on the debt number? Why would they just report the money owed to their banker mates?
1
@OnlineEnglish-wl5rp There's no evidence for that. In fact its the contrary,. The BoE booked at 35 bn profit on the SLS [Special liquidity Scheme]. All the money repaid in full. But if you look at the accounts, you can see just how much goes on the debts. All of them. It's 30% of tax. So austerity. Taxes at record levels, and spending is cut. The reason is that the difference is going in debts. That's public austerity and the cause. You can check this. BoE for the SLS, its on their website. For the cost of debts, see the WGA [whole of government accounts]. The spending is correct, its the liability side of the balance sheet that's fraudulent. Next, personal austerity. Low take home pay. Would a 30% cut in your taxes help? Of course it would. But there's those debts to pay. Let me tell you what's going on. You've been told by the people who have created the debts that someone else is to blame. Anyone but them. Why do you believe them? Notice, I've given you all you need to do to go and check for your self. A bit different from people who demand your money so they can spend it
1
@WarrenPeaceOG Austerity is a consequence. The money going on the debt causes the austerity. Austerity is the state making a 30% gross profit on its services.
1
@karlkerr7348 Agreed. You can cancel civil service pensions. Use the money for something else. Is that what you want?
1
@stevegandalf4739 Steve, so lets go through it point by point. Money going on the debts. At least you realise that debts is plural. Borrowing, pensions, the EU, nuclear clean up,.... there are lots of debts. Spot on that a huge percentage is going on the debts. 30% goes on the debts. Growth is certainly hit, but those debts aren't connected to the banks, and remember the state made a 35 bn profit from the bailout Those debts are the cause of austerity. The cause of wealth inequality. The cause of that lack of growth. The cause of pensioner poverty. The cause of a lack of investment. So look at Karl's original post. Borrow and spend more money. Which produces more debt, which produces more debt costs, which ...
1
@stevegandalf4739 Sure. Taxes compared to cost of services. 30% gross profit margin.
1
@stevegandalf4739 Austerity. What's your definition? I'll give you two. Personal Austerity. You take home less money, you have to pay out for things you don't want or need, by force Public Austerity. The state cuts services. Those are two reasonable definitions. So the state pays 30% of all tax to service its debts. Debt isn't a service. So public austerity - caused by the debts. Would a 30% cut in your taxes help with personal austerity? Of course it would. But you can't have it because of the debts.
1
@iwantagoodnameplease So can you owe yourself money to make something valuable?
1
@helenheenan3447 Private banks. Money can come from commodities. Money can be created like bit coin. In the past, private companies issued coin.
1
@helenheenan3447 That's a different argument. That relates to how value is given to fiat money. That's taxation and fines. The original statement was that only governments can create money. That's clearly false.
1
@helenheenan3447 So how did governments tax before fiat sterling?
1
@julianshepherd2038 Only if you ignore pensions Julian.
1
So pensions run by the state. A debt or not. If its not a debt, don't pay it. What's the issue apart from starving pensioners. So the question is how big is the debt, what's its rate of growth, and can you get the growth needed to keep it under control.
1
@paulbo9033 Here are the things that make up the True National Debt. 1. Borrowing 2. Civil service pension 3. State pension 4. Nuclear clean up 5. Losses on insurance contracts 6. The EU 7. Unpaid wages 8. Unpaid invoices 9. Expected payouts - eg post office, NHS damages. Now state pensions are inflation linked. In order to pay you have to take money from one group, the workers to pay the debt. It's inflation linked debt, which means its a promise to pay purchasing power. It also means if you print to pay, your debts get bigger. Double the money supply, the pension debts double in terms of Sterling. So to come to any conclusions you need to a) Quantify the debt. How big? b) What's its rate of growth? Then you can compare against GDP growth. Do you know those two numbers for the debt? If not can you find them? If you can't, and this is the more interesting question, why is that information hidden from you? Who hides it? Why would they do that? What have they to gain or lose? Nothing strange at all with those questions, but the answers are very telling.
1
@paulbo9033 So once you have those two numbers, amount owed, rate of increase you can now work out if its' going to work - your budget bit. What percentage of tax going on debts will the public accept? What level of austerity [taxation not going on services] will the public accept? Is the growth rate above GDP growth? The per tax payer amount. Can all tax payers afford that? You're right on the budget bit. Is there a budget that will pay the debts.
1
@paulbo9033 The budget deficits accumulate up to make the national Borrowing. So I'm not confused on that. But national borrowing is just a fraction of the true national debt as you know. Public sector pensions, state pensions, .... all on top of the borrowing.
1
@andrewcarter1771 I have. He's bonkers. Lets have a new currency called the voucher. We pay civil servants in vouchers. No need for taxation the government just spends the vouchers. Heck we even double salaries as a bonus for the change over. £50,000 salary? Now its 100,000 vouchers a year. What happens when they try and spend the vouchers?
1
@andrewcarter1771 So taxation [and fines] give value to fiat money. Since the pension debts are inflation linked, that means you need to pay them in a currency that has value. You need taxation in order to pay pensions. It's a transfer of wealth from the workers to the pensioners. So you have to tax.
1
@paulbo9033 They are net each year. The sum of budget deficits over the years, plus interest, less repayments is the value of the BORROWING. National debt is not the same thing as national borrowing. The True Debt is horrific, even when knocking off assets. So how big are the public sector pension debts?
1
@paulbo9033 Perhaps an example for you. Start of year zero - debt zero Borrowing 0 bn Taxes 900 bn Spending 1000 bn Deficit 100 bn Start of year one Borrowing 1000-900 = 100 bn Taxes 900 bn Spending 1000 b Deficit 100 bn Start of year two Borrowing 100 bn + 100 bn + interest. 210 bn at 5% [if you borrow at the start of the year Deficit is not the borrowing.
1
@julianshepherd2038 You have to look at the definition of what appears on the liability side of the balance sheet. For example, give the government money and the government agrees to repay you in the future according to a formula. For example, inflation link bonds fit that. Pensions fit that. The actual definition is this. **A liability/debt is a present obligation of the enterprise arising from past events, the settlement of which is expected to result in an outflow from the enterprise of resources embodying economic benefits** For example, if the state has received money in the past and is obligated to pay it back in the future its a debt. e.g Borrowing or pensions. Economic value covers services and goods. For example, if you worked for the state in the past and as a result the state is obligated to pay you a pension in the future, its a debt. Same for unpaid wages. Other examples, if we take the NHS. If the NHS has damaged someone in the past, from a mistake then the expected damages are also a debt/liability
1
@julianshepherd2038 If you want another test Julian. Go to your local UNISON meeting. Stand up and say you are going to partially cure austerity by cancelling their civil service pensions. After all they aren't owed it. [1] You might want to wear a stab proof vest and wear a helmet.
1
@julianshepherd2038 The EU is a debt. A part of the agreement the UK is on the hook for 10% of their debts. Unpaid wages? Wages are paid in arrears. It's a debt You clearly do not understand accounting.
1