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Thread: Two sides of the same coin.

  1. #1

    Default Two sides of the same coin.

    How is it that the government/UK debt goes up but they praise themselves for cutting the deficit?

    Surely if you have debt and still borrow, you are still in debt.
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  2. #2

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    Debt and deficit are two different things, although politicians and the media regularly (and often deliberately) confuse them.

    The deficit is the amount they spend more than they receive each year; the debt is the total accumulation of this.

    If they cut the deficit from £100bn to £50bn debt goes up £50bn. It's only if you change the deficit into a surplus (say, in-comings £200bn, outgoings £199bn) that you start to eat into the debt.
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  3. #3

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    Quote Originally Posted by Cricko View Post
    It must be easy to cut a deficit if you pile up debts elsewhere.
    Ha, very true!

    It's not unknown for departments/businesses to push up expenses with an eye on next year's budget, as that will be based on their expenditure this year.

    Should we move this from the Politics thread to the Finances & Fossetts Farm thread?
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  4. #4
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    Some would argue,including me,that for the Tories after 2010, eliminating the deficit was just a pretext to slash away at the welfare state,via their austerity programmes.
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  5. #5

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    To be fair it’s was the fastest growing expenditure and out of control

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