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The 51st State

September 10, 2004
In the UK, just like the US proper, in this current cycle, while capital investment has been barely at replacment levels and while manufacturing has been decimated, consumerism has run amok (with both central bank and government connivance), as household debt has risen by c.1% of disposable income per month every month over the past 2 1/2 years and not only are we, too, living beyond our means largely by extracting "equity" from the housing bubble on an unprecedented scale (c. 7% of income in the past two years) .... but, guess what ?
  • We, too now have an energy crisis (we just clocked up the first oil trade deficit in over a decade and one of the few since N Sea came on stream - production there is off 12% in a year and we're about to run out of NatGas, also) ...
  • We, too register record trade gaps, with a 3.5% GDP overall, 5.2% goods ( = 14% of total two-way trade) imbalance.. the overall tally for which should come in between GBP35-40 bio this year...
  • We, too, have rising government indebtedness as the Gulag state swells rapidly (though no exacerbating tax cuts from the Neuearbeitspartei, naturally), saddling us with a budget deficit (on balance sheet, at least) of c.GBP35 billion a year - a "Twin Deficit" no less exact than that in the US.....
  • To cap it all, we Brits, too, spend almost exactly this sum - GBP35 bio - as Auxilia on "Defence", so one of our Twins also wears combat fatigues and carries a rifle, though an SA80, not an M-16 in our case! Civis Romanus Sum
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