3:27pm Friday 12th March 2010
IN his letter, (We should have held on to France, SA March 8), Mr Shipp accuses the Labour Government of running up a debt of 460 per cent of GDP. As I understand it, the figure of 460 per cent of GDP refers to all the nation's debt whether public sector or private. Much of it has been racked by individuals to finance the purchase of furniture, white goods, cars and, above all, flats and houses. Anyway, the country wasn't debt-free when Labour came to power in 1997. We still hadn't finished paying off the debts of the 1939-45 war.
What so often gets forgotten in all the rhetoric about debt is that the economy simply couldn't function without it. The demand side of the economy is propped up with borrowing. Obviously estate agents, property developers and builders would be the first to go if all credit was simply turned off, but in no time at all it would impact on everyone's livelihood. We'd be back to a barter economy. How many of my cabbages do you want to repair my shoes?
DON REEVE Okus Road Swindon
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