Great Britain As The Next Greece

May 2, 2010 (LPAC)—Great Britain could become the next Greece sooner than people may think. The Greek crisis began after the Pasok Party came to power in October and had a look at the books which showed them to have been "cooked" well done. The same could happen after the British elections this month. City of London mouthpiece Ambrose Evans-Pritchard revealed in the Daily Telegraph that government debt worth billions is currently "off the books."

Evans-Pritchard writes that this was revealed by Bob Janjuah of the Royal Bank of Scotland at a conference of bankers in Berlin. He told the conference: "Britain's debt metrics are pretty ugly when you include PFIs (private finance initiatives) they have off books. We think the real figure is over 100% of GDP already."

PFIs are a derivative of public-private partnerships and have been used extensively by the British government to finance infrastructure and other capital projects, including to build embassies, hospitals, schools, and even Britain's contribution to the European aerial tanker project. Since these are off the books, it is apparently not known publicly how much is actually involved but it obviously runs into the tens, if not hundreds of billions of pounds.

Janjuah called for the next government to immediately bring in the International Monetary Fund to do a "technical audit" of the government's books, so as to cover their ass, because they will not only find some nasty surprise, but will have to implement an austerity whose brutality will be unheard of the postwar period, after which they will be out of power for the next 25 years.

Evans-Pritchard quotes Ruth Lea, of Global Vision, a Euro-skeptic think tank representing the interests of the City of London, as saying, "any incoming government will need all the help and support it can get... The IMF is internationally respected, it is the obvious choice to get help from, not necessarily a loan, but support and moral backing in what is going to be an appalling situation."

No matter how many billions are hidden as PFIs, none of this includes the hundreds of billions in pounds that the government has used to bailout the British banks. Furthermore, now that the government virtually owns such banks as the Royal Bank of Scotland, it is responsible for their liabilities. The press and government have stopped publishing this figure.

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