George Osbourne has given £10billion to the IMF's euro-bailout fund - is this disgraceful when we have spending cuts in the UK?
George Osbourne has pledged ?10billion of UK money to the IMF international emergency fund, adding ?10billion to the UK National Debt - this money could have been used to support UK government spending within the UK and will mean extra taxation for UK taxapayers to pay the extra interest on this debt.
The IMF boss Christine Lagarde has been begging around the world for hundreds of billions to fill up an emergency fund which is designed to bail out countries that are at risk of economic collapse. Undoubtedly, the size of this requirement is being driven by the crisis in Eurozone countries, with Spain and Italy now on the verge and Greece, Ireland and Portugal having already been massively bailed-out. Many wealthy nations in Asia and South America (ie China, India, Brazil) - plus the USA (which only pretends that it's wealthy...) - are stinting on contribution precisely because it is a Euro-bailout fund.
How appropriate is it for the UK to contribute to prop up an economic experiment of which we are not a member? How fair is it that UK taxpayers are now being compelled by this cavalier contribution from George Osbourne's mouth to an extra debt burden, when the government is (rightfully) having to reduce spending to try to rescue the socialist disaster that was inherited in 2010? Does this not prove beyond all doubt that Osbourne (as with all his predecessors as Chancellor of The Exchequer) is completely in the pocket of the Banking cabal?
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Responses (14)
Interesting point, thetruth.
As I understand it, from listening to Radio 4 this morning, the money is a loan that will be repaid with interest. If we were just giving the money away I would totally agree with you.
And surely we can't live in isolation from the rest of the world? Economic collapse in other countries would have a negative effect on the UK economy.
It proves also that banking fraternity run all major governments.The UK is NOT in a position to lend over ?10Billion to countries via the IMF.We do NOT have it in the first instance and are further maximising upon the country's credit card.But the government has no choice or power because it is the global banksters who run international politics.
Well, let's hope that we get it back eventually and that the interest will be paid. The UK certainly cannot afford to give the money away, nor should it, but maybe it will eventually be a 'nice little earner'.
We'll never get it back - the world revolves on ever-increasing amounts of government debt. It will takes decades of austerity just to sort out the overspending by Blair/Brown, let alone unwind the decades of historical debt that encumbers our fiscal system.
Sadly I think you could well be right thetruth.
What is extremely funny about this, if it wasn't so tragic, is that the the UK government is borrowing vast sums of money itself to pay for their plans and policies. Although in truth, I don't actually know what this government actually stands for besides cuts, which seems odd, as they are borrowing more than the previous incompetent incumbents in political office.
So from this loaned money, we then loan to others and gain interest on the amount we have loaned, whilst paying interest on the money we have loaned.
I wonder if the interest rate repayment on the ?10 billion loan is higher than we pay on the loans we borrow?
By offering just less than ?10 billion he doesn't have to seek the permission of the Commons to sanction this payment, thus circumventing the true democractic process.
It would be argued that to do nothing is more harmful to the UK economy and this proposition is advocated by the party who went to Europe and excluded themselves from having any meaningful say on the future shape of European fiscal policy by exercising its lonely veto.
The urgency of the IMF's begging suggests that another major European restructuring and bailout is just around the corner!!
Good point - how stupid it is for government to borrow in order to lend. I wouldn't mind betting that the interest rate from the IMF would not be enough to hedge against the risk of gross default by whichever euro-basketcase state eventually swallows the cash into its black hole.
Is ?10 billion:-
(a) ?10,000,000,000,000
(b) ?10,000,000,000
(c) Another sum ?
Many thanks!
In this context, we are talking about miniature American billions - ie thousand millions - what used to be called milliards until the hegemony of Yankee terminology took over.
So ?10billion = ?10,000,000,000
I avoided using the word milliard because it's gone out of usage these days - though whenever I think of a billion I think of the correct number, ie a million million.
The French still use the term milliard to describe an American billion.
Hmm. But depending on the denomination, further QE will either increase or reduce the total amount coming back due to its effect on the exchange rate... By the time the loan is repaid, our £10,000,000,000 might only be worth £5,000,000,000 and we'd have lost 50% in real terms...
You're doing my head in now, G-Man.......
Or more likely, whichever broken state takes the money will default on 50% of the debt, hence we'll not only not get back the money, but also not get half of the interest due on it.
Heard a good crack on 'Have I Got News For You' this evening - with reference to the odds on Greece dropping out of the euro by the end of the year reducing to 6 to 4 on: "here's a good tip for the Greek Finance Minister - bung 60 billion on that bet, drop out of the euro and bang... 40 billion profit!"
We are borrowing enormous sums to keep our country going yet this clown can pledge this ?10 billion to the IMF this definatley takes the mickey out of the British tax payer.
Yet the British taxpayer is mostly ignorant of the real meaning of all these banking machinations, so the mickey-taking will continue.
Osbourne claims that the money comes from the Foreign Reserves and that this money would not be available for public funds. Whyever not if the country needs it? More importantly, I don't believe that this money exists. I remember when G Brown was discussing MOD funding for the Middle East he spoke of a fund of around ?3.5 billion, so how come after a recession we have over ?10 billion?
Secondly, does the IMF guarantee the return of this money? Money lent to Greece for instance is not being returned in full so the interest rate is of no consequence if we suffer a capital loss.
This whole situation stinks of control from elsewhere outwith the wellbeing of this country.
Well-said! Most likely, whichever country whose economy is teetering on the brink of collapse and gets bailed out by the IMF will then get its debt 'restructured' and then a lot of it will be written off.
Sealate you bring up a valid question. Just where are these reserves and how did they get funded? It strikes me of slush funds, underhanded dealings and off balance sheet transactions. And who accounts for it? A chancellor who doesn't even pay his stamp duty, overeggs his expenses and God knows what else.
Feline makes a very valid point and as I undersand it the loan is to be repaid but whether in full or not remains to be seen. However, we all want the best for the UK and the phrase "charity begins at home" is, I believe, at the forefront of the general public's mind. Central government funding and budgets are far from simple and I don't pretend to understand where money can suddenly appear from!! I have lost any faith I had in Osbourne and this government and not just on the financial aspects.
Sad to say - given my own instinctive rightwards political leaning - but I lost faith in both Cameron and Osbourne a long time ago. They're a pair of craven toadies to vested interests in Banking and the USA. Time for a government that thinks of the UK first.
They would argue that everything they do is for the betterment of the UK. With the inter-connectedness of the global ecomomies and laws it isn't easy anymore to think of the UK as an independent nation.
We cannot legislate for our own good without ensuring that we aren't compromising European law, or uphold our homeland security without first seeking the permission of the European Court of Human Rights. We are but an annexe of a European and pan-American Super State.
Our independence and sovereignty vanished a long time ago but it is in the interests of all political parties to, on the one hand, be seen to protect it, whilst with a sleight of the other hand continue to give away vast swathes of our sovereign and democratic rights.
At least I take comfort in never having lost faith in George Osborne. As never having had it in the first place avoids that level of disappointment.
If there is no money, he'll have to borrow from somewhere. Either the IMF, Germany or the NS&I will be back on sale!! Wonder when the transfer is going to be made and if Morning Cloud or a brown envelope is involved?
This money will be used to bail out euro zone countries in debt but will increase the deficit in our own country cant see his logic unless his fortune is invested abroad.Meanwhile he is upping the tax on food such as hot pies and pasties which is the stable diet of our own working class that he is robbing blind.
How much interest do we get on this loan? Is it nil.
But if you had a european holiday home and the euro was about to crash, how much would your investment be worth?
So is the 10 billion quid to help George Osborne keep his holiday home's value up? I guess it is.
And the euro would be over priced at 69p, so now at 82p we are putting in 40 billion pounds to act AGAINST us. What the hell for!! George is getting something personally for this as it acts against Britain.
No, gryan, the interest on this loan is not nil
The value of the Euro at 82.33p is determined by the market and is considerably better than in the last days of the Bliar/Broon regime when it almost had parity with the ?.
I'm not aware that George Osbourne has a holiday home in Europe, but if he has he will face the same challenges as the rest of us. Naturally, I would love to have the benefit of your inside information on this.
It would be very nice for UK holidaymakers in Europe if the Euro was at 69p, but 82p is not too bad as it has been much worse over the last couple of years.
I hadn't heard either that George Osbourne has a holiday home in Europe. Where is it gryan?
What is the interest on the ?40 billion then Feline? At the end of Blairs reign (I spelt it correctly.Is Broon a politician?) I was getting 1.22 at the tourist rates and now it hovers arount 1.17 and has been as low as 1.05 in the last 12 months. So it has been a lot lower and only during this governments time and the end of Browns bit.
As there is no sensible reason for the extra ?10 billion loan, I extrapolate the investment on George's part. If I could ask him he would lie, just like he lied when asked if he earnt over ?150k so he and his chums could save 5p in the pound.
I do believe that Osbourne was the first one who volunteered that ministers should disclose their earnings. As he's on about ?140k as Chancellor and may get something from the trust that controls the family business (which he will inherit eventually) I think he has the choice to keep his income below the ?150k mark by taking nothing from the family business.
It is nearly impossible to get info on millianaires who get top drawer accountants and legal teams to hide and manipulate their affairs, but George Osborne has got a holiday home in California. So the idea of having overseas investment is at least established.
I really cannot see beyond the end of my nose on this clearly complex debate but this is just another example of the British government wanting to be a 'global player' and 'flash the cash'.
Is it really all about how British magnamity is perceived in the big wide world? And in it's simplest form, shouldn't the 83 year old pensioner whose care package has been dramatically cut recently be fully entitled to stand up and kiss ass in return?
True - it's always been the case that the UK tries to punch above its weight, but it's all been an illusion since the '60s when Roy Jenkins (as Chancellor) declared that "we are no longer a superpower" when he was devaluing the ?.
Jolly well put! Kathyg
Osbourne pledges ?20billion to the IMF and clown Cameron calls for ?billions in further cuts is this the blind leading the blind are they both in denial or just extracting the urine out of the great British public.
The latest £10 billion is a top up. In all £40 billion. And the "interest" is still undisclosed. Bank of England rate? Thats low to help our domestic economy, not our competitors. There is extreme corruption in this loan. It makes no sense and counts against us when we need help ourselves.
No, I'm sure that the government isn't blind - they're just outrageously compliant to the demands of the Banksters (with thanks to creativesaver for that term). We the humble plebians are kept blind by the sheer jargoneering and the stream of poisonous scaremongering effluent that pours out of the Banksters mouths. We have no say in the matter - it's our money (and the future earnings of the next several generations) that is being sunk into propping up the whole system and we can't even get a government that isn't deeply in the pocket of the Banking fraternity - Brown & co gave loads away as well.
This is all one big con.Firstly we are told that Chancellor Gideon Osborne has agreed to give the IMF ?10 Billion then he wants to cut welfare by a further ?10 Billion of which Ian Duncan Smith is resisting(allegedly). Hence, the welfare cuts to the poorest is what is subsidizing the IMF. How financially immoral can you one get by taking away from the very poor to give to the relative rich in the Eurozone?This is a political and monetary CON.
Exactly - the government shouldn't be wasting money abroad when they literally don't have the money to waste in the first place.
Mrs. G. has just asked "what happens if the Eurozone goes bust- do we get our ?10 billion back?"
Good point to discuss?
The Eurozone IS bust (except for Germany, anyway) - and we'll never get the money back, it'll just go into the huge pile of intergovernmental debt cross-holdings that keep the world spinning. If we're lucky, we'll keep receiving interest payments on the money and if we're REALLY lucky the borrowing nation won't default on it altogether.
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Well, that's the sort of scaremongering that was employed when the Banks all lay down with their palms outstretched in 2008 - "we must bail them out or the world will end!" It was an opportunity to fundamentally reform the whole nature of banking, but rather than seize that opportunity, the government chose to perpetuate the whole rotten system using taxpayers' money.
Surely it's better to use that £10 billion bolstering our armed forces, waiting for the collapse of the other world economies so we can then go in and annexe them into the Greater British Empire?
Love it, G-Man. Bring it on!!!!!!
Well, I know where I'd devote military effort - naval protection of shipping in the Indian Ocean. Send our boats round there and rent them out as security for passing freighters - hopefully discourage the Somali pirates and make some money out of it while they're about it.
Cautionary note about Empires - very expensive to run and the 'blasted natives' never appreciate it anyway - start rebelling an' all.... Besides, China's the only country that can afford to annex the rest of the world nowadays - they've stitched up a lot of Africa and South America, they're ahead in the race to grab all of the oil from Central Asia (the same oil for which the Yanks invaded Afghanistan in order to establish a pipeline) and they basically own the mortgage on the whole USA.
That would be realy funny if it were not true, thetruth!