There’s an actual debt disaster in Britain – nevertheless it’s not the one the politicians or journalists are speaking about.

Whereas Rachel Reeves and the media obsess over authorities borrowing, 4 million folks are already in unfavourable budgets, that means they’re unable to afford the fundamentals of life with out debt.

This video explains why the true debt disaster within the UK is about non-public debt, not public debt. It reveals how austerity, low wages, speculative markets and damaged advantages drive extraordinary households into despair, all whereas the Treasury celebrates its so-called “fiscal self-discipline.”

I argue that authorities debt just isn’t a burden; it is a instrument, however non-public debt is an actual lure. In the meantime, the Treasury’s obsession with balanced budgets is main Britain in direction of social collapse and, dangerously, in direction of fascism.

That is the audio model:

That is the transcript:

There’s a actual debt disaster within the UK, and it is not the one that everybody is speaking about.

Journalists, political commentators, politicians themselves, plus, after all, central bankers, are all speaking about the truth that throughout the course of  September 2025, the UK authorities borrowed greater than £20 billion, utilizing their chosen language of borrowing moderately than that of saving, which I’d use,  and so they say that this represents a disaster second for the federal government and that it should take motion to manage its deficit. However that’s not the true debt disaster on this nation.

The actual debt disaster on this nation is the truth that  4 million persons are residing in what the Residents Recommendation Service within the UK calls a ‘unfavourable price range state of affairs’. In different phrases, they’re residing past their means. They can’t pay for the fundamentals of life and survive from month to month with out borrowing. That is the true debt disaster within the UK. Authorities debt is of no consequence in any respect compared.

Rachel Reeves and the monetary markets are obsessing in regards to the nationwide debt. However the truth that Residents Recommendation have discovered that 4 million persons are residing in households which might be already within the crimson, with one other half 1,000,000 folks shut behind, is to me a lot extra essential. What which means is that round 7%, or one in 14, of the folks within the UK live in everlasting states of debt misery. In different phrases,  they’re overspending, however not as a result of they’re being profligate, however simply because they’re merely making an attempt to outlive.

They’re spending on necessities, and people necessities come to sums which might be greater than their revenue.  Necessities, like lease, power, transport, clothes, placing meals in entrance of the youngsters, and sending them to highschool. These are the issues which might be actually sending them over the debt edge.

These households are borrowing simply to make ends meet. And this is not fiscal irresponsibility on the a part of these households. It is financial failure engineered by authorities coverage.

Wages have been frozen for a lot of in actual phrases, whereas costs and particularly costs on these issues which might be important to well-being, together with issues like power,  telephones, transport, and even council tax, haven’t solely gone up by greater than inflation, however are geared to go up by greater than inflation, so punishing these households, specifically, as a result of for them, these are an even bigger a part of their general spending in comparison with the households of the effectively off.

Housing and power markets seem like designed for hypothesis; hypothesis at value of those households and to not assist them survive.

Advantages have been lower in actual phrases, and so they’ve been delayed or topic to sanctions, and all as a consequence of official forms.

And while governments declare they cannot afford to assist, now we have individuals who actually can’t afford to reside. That is how unhealthy issues have gotten.

When the federal government withdraws assist, and that’s what it’s doing, households tackle the debt burden in our financial system, and that’s what is going on.

Personal debt fills the hole the place public spending ought to be. That is what’s going on, and households are having to show to costly lenders, folks just like the doorstep lenders; those that shall be charging rates of interest that might run to a whole bunch and generally hundreds of per cent a 12 months.  I’ve investigated these folks throughout the course of my profession. They’re deeply exploitative.

So, whereas the federal government can borrow at below 5%, usually, nonetheless, these persons are being pushed to the wall by being pressured into debt that’s virtually unaffordable. And that I repeat is simply to fund their primary wants, whereas the state boasts about its fiscal self-discipline. It is perverse. The poorer the persons are on this nation, the prouder the Treasury seems to be about its successes.

However the reality is, authorities debt just isn’t an issue. We’ve a delusion in regards to the nationwide debt, which is solely not sustainable.  The very fact is that the federal government has already spent cash into the financial system earlier than it ever has to consider so-called borrowing. In truth, its borrowing is simply the distinction between the full quantity that it spends into the financial system, which is supplied to it by the Financial institution of England and nobody else, and the quantity that it takes again by means of tax, with the borrowing merely being the steadiness within the equation. It isn’t borrowing as such, due to this fact; it is a spot for many who’ve ended up with cash as a consequence of the federal government not taxing sufficient to position their cash in a secure surroundings. It is only a financial savings account.

However let’s be clear about it, these financial savings accounts are helpful.

They’re the premise of personal pensions.

They’re the premise of the life assurance trade within the UK, and that is of worth to many individuals.

They’re the premise on which overseas governments can afford to save lots of within the UK in sterling, and that facilitates our commerce.

This can be a priceless exercise, not least as a result of it underpins our complete banking system.   📍

So I am not saying we do not want authorities bonds, and I am not saying we need not have the financial savings accounts, which the federal government supplies, that are referred to as the nationwide debt fairly inappropriately.

What I’m saying is that there isn’t a disaster in regards to the nationwide debt, and that is been proved, after all. If the federal government needed to borrow £20 billion extra in September 2025, it had no downside in doing so. Folks marched up in an orderly queue to purchase the federal government’s debt, in contrast to the individuals who didn’t march as much as assist those that are in debt as a result of they cannot meet their family’s wants.

So  the hazard comes when folks and never the state are pressured to reside in debt.

Individuals who need to reside in debt reside with fixed nervousness. It is exhausting; harmful, completely, of private well-being,  of household well-being, of relationships. Meals banks are normalised. Precarious residing and homelessness are rising. Debt destroys dignity, hope, and well being.

And it is not simply economics both; bear in mind, social decay engineered by austerity results in concern, and that creates the trail to fascism.

Poverty is a coverage and never a destiny. It is a alternative between sincere politics and penalising the poor.

Sincere politicians would recognise that they will elevate the funds that they want out of the cash that they’ve already spent into the financial system to steadiness their books in the event that they so want, while providing financial savings alternatives to these with wealth.

They would not faux that they need to punish the poor, however that is precisely what they’re doing.

Their cowardice is denying folks the possibility to thrive and is as a substitute creating penalties on the poorest, who’re being pressured to pay for it. That’s the political alternative that is occurring.

The federal government may fund residing wages. It may fund inexpensive housing. It may fund first rate advantages. It may stop kids from having to reside in poverty. It may stop dad and mom, old-age pensioners, and others from residing in untold stress.

And it may tax extra income, and it may tax the rentier financial system, and it may take cash from these of wealth who’re sitting on cash that is doing nothing productive for society in any respect. However as a substitute, it chooses to serve monetary markets by retaining the parable of debt going, as a substitute of serving folks.

The result’s a disaster for our democracy. Let’s be clear, determined folks flip to extremes when politics fails them.  Inequality fuels instability, whether or not it is financial, social, or political. And the obsession with balanced budgets whereas households drown in debt is ethical and monetary nonsense.

What should be executed? The reply is obvious.

We should recognise that the true debt disaster we face is private and never nationwide.

We must always finish austerity.

We must always assure revenue safety for these on the bottom ranges of revenue in our society.

We must always spend money on public items and never bond markets.

And authorities debt is only a instrument, whereas family debt is a lure, and politicians need to know the distinction, and since they do not, we’re in serious trouble, and studying that distinction is now important.

Let’s have a ultimate thought of this. The UK authorities doesn’t have a debt downside. It has a poverty downside. It has a family debt downside. 4 million persons are residing in disaster on this nation, and they’re the federal government’s accountability as a result of it may remedy their downside, and it will not, and that’s the actual nationwide emergency we have got.

Fiscal accountability, if Rachel Reeves had been to actually perceive it, can be about ensuring these folks can reside and never simply reside, however reside effectively. However we aren’t doing that. Labour is failing us all. It is failing folks. Our society, our democracy, our youngsters, our futures, and it is laying the trail for fascism and all as a result of it desires to run a false story about debt, which is completely unfaithful, to maintain the Metropolis of London comfortable. It couldn’t be extra irresponsible.

So what do you suppose? Do you suppose that non-public debt is extra essential than authorities debt? Do you suppose the federal government ought to let its debt enhance to make sure that these households who’re residing in peril are literally shielded from the dangers that they face? Do you suppose that the debt disaster amongst households within the UK, by way of no fault of their very own, is what helps drive the transfer in direction of fascism on this nation? Or do you simply not know?

Tell us. There is a ballot down beneath. I will be eager to listen to what it’s a must to say.

Ballot

 Loading …

Taking additional motion

If you wish to write a letter to your MP on the problems raised on this weblog publish, there’s a ChatGPT immediate to help you in doing so, with full directions, right here.

One phrase of warning, although: please guarantee you’ve gotten the proper MP. ChatGPT can get it improper.

Feedback 

When commenting, please pay attention to this weblog’s remark coverage, which is on the market right here. Contravening this coverage will lead to feedback being deleted earlier than or after preliminary publication on the editor’s sole discretion and with out clarification being required or provided.