By Godfrey Bloom MEP • At long last the credit rating agencies are starting to take their responsibilities seriously and their assessments professionally. Of course the politicians and central bankers are squealing as the spotlight turns from retail banks to themselves.
The real problem with US debt is not so much the $14.3 trillion of debt but the $150 trillion of unfunded liabilities. When the markets start to acknowledge this the US will slump to BB at best.
Nor is the UK any better placed. For all the public sector union anguish and public broadcasting hyperbole no real cuts are being made at all. Public sector spending is reckoned to be broadly the same in 2015 by the government’s own estimates. Again it is the unfunded liabilities which when the markets get around to us will inevitably see our credit ratings sink in line with the US.
The Chinese government is quite right in blaming the west’s hopeless addiction to welfare and public sector in this country accelerated by Ken Clarke’s Chancellorship in the mid nineties to the out of control roller coaster we are now on.