Back to work, Serf! We've got that monument to 0bama to build! ;)
Posted on 04/07/2010 7:28:17 AM PDT by TigerLikesRooster
Industrial world underestimates state debt: BIS
6 Apr 2010, 2030 hrs IST,AGENCIES
GENEVA: Industrialised economies face a worse public debt problem than reflected by official data because spending for ageing populations will raise debt further, research by the central bank body BIS shows.
"Fiscal problems confronting industrialised economies are bigger than suggested by official debt figures that show the implications of the financial crisis and recession for fiscal balances," said the economists at the Bank for International Settlements, the bank for central banks.
"As frightening as it is to consider public debt increasing to more than 100 percent of GDP (gross domestic product), an even greater danger arises from a rapidly ageing population," they added in the research paper published at the end of March.
The report favoured an increase in the statutory retirement age over cuts in benefits or tax increases.
State debt grew sharply with the crisis, as many governments not only had to bail out ailing banks, but also pay for rising unemployment benefits and economic stimulus programmes.
Greece was brought to the brink of bankruptcy in recent weeks, forcing the government to increase taxes and cut spending to shrink state debt. It has warned that some pensions are not guaranteed from June.
The BIS research warned that the "aftermath of the financial crisis is poised to bring a simmering fiscal problem in industrial economies to boiling point."
It forecast that if no changes were made to current policies, by 2020 debt would rise to over 300 percent of GDP in Japan, 200 percent in Britain and 150 percent in Belgium, France, Ireland, Greece, Italy and the United States, said the BIS.
Most of the projected deficits were structural rather than cyclical in nature and would not right themselves on their own with an economic recovery.
The BIS researchers called on governments "not to be lulled into complacency" by how easily they have financed their debt so far.
"In the aftermath of the financial crisis, the path of future output is likely to be permanently below where we thought it would be just several years ago."
Government revenues would be lower and expenditures higher than before, making balanced budgets even more difficult to achieve, the report warned.
"Unless action is taken to place fiscal policy on a sustainable footing, these costs could easily rise sharply and suddenly," it added.
P!
You mean to say that some of us are actually going to be able to retire one day?
Not in 0bama’s Amerika, Comrade. ;)
Simply shut down governments until the debt is zero. There, problem solved.
That's racist. African Americans will work till they die, because their mortality is lower. They'll never reach the age of retirement. The government will just keep the money. Ching ching $$$.
It would be the best government we ever had. I like the idea.
Back to work, Serf! We've got that monument to 0bama to build! ;)
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