Ransos - I don't know whether you just like a bit of internet banter or whether you are simple economically niaive. But when you throw up charts of public sector debt and suggest that current levels of debt are not high or that all governments need to borrow, you really need to step back and think.
1. Increased levels of government debt stunt economic growth (although economists will argue as to the exact level)
2. If you go back to the history on your graph. What happened after the periods of high public sector debt?
Answer a combination of default and/or major financial repression. After WWI most economies simply defaulted on their debt to the US (jncluding the UK) . After WW2 we had a combination of either inflation or financial repression to bring down the levels of debt. Financial repression is where interest rates are kept artificially below inflation and below the levels that would normally apply and therefore money is simply taken from savers to the government. The same thing happened in the 1980s/90s ie a combination of FR and/or inflation.
Governments like FR because it is a hidden tax but it cripples us all and it takes a long time to work.
So where are we now....we are faced with very likely defaults and or many years of financial repression. Do your really want to lend to the UK gov for 10 years at just over 2% FFS?!?!?!? Your savings and pensions are being forced to do this, so dont weep when the returns are eroded and you lose the real value of your money.
So enjoy the posturing on internet forums and prepare yourself for a long period where conventional savings/financial assets can no longer be relied on. And when your pension is screwed remember what you said back in 2011.
