Insatiable British Love Affair With Credit Wreaks Havoc

July 29, 2008 - PRLog -- According to the BBC website, people in the UK are borrowing on average almost twice that of citizens in other western European countries, a report has found.

Unsecured UK lending, such as credit cards, was £216bn ($408bn; 319bn euros) in 2005 - more than a third of all new non-mortgage borrowing in Europe. The average British resident owes £3,175, business research firm Datamonitor said. Total UK personal debt, including mortgages, is about £1.2 trillion.

The report, which looks at the market for borrowing via personal loans, hire purchase, credit cards and overdrafts in 16 European countries, said that the UK had an "insatiable appetite for credit". The average European owed just £1,558 in unsecured debt.

We can all be accused of getting somewhat blasé over the scale of the problem, which is understandable when the numbers are so mind-bogglingly huge! let's just try to put it into a bit of perspective; £1.2 Trillion is £1,200,000,000.00 which is a pretty big number by any standard!

Why are Britons obsessed with debt? I think it's more a case of Britons are obsessed with Capitalism, but don't have the wealth, resource or infrastructure to sustain demand. We have seen the trend of following on the petticoat tails of our North Atlantic cousins in the US. However, even the worlds' (until now) biggest economy, has caught a severe cold at best. At worst it's in intensive care fighting for it's existence!

The US is a manufacturing nation and as such, has the potential to begin engineering it's way out of recession. It also has massive reserves of oil, gold and other valuable resources including technical skills and know-how. In the UK we are somewhat lacking as a manufacturer. Almost all our industry has gone as we outsource more and produce less.

People in the UK have been encouraged and almost forcibly cajoled into adopting a lifestyle way above their means. This has in a large part been down to the actions of retailers and the financiers behind them. as an example over the last few years we have all been made aware of the demise of cash in our economy.

As an example, if you go to buy a new TV and say you want to pay in cash, it's almost as if you're a cross between Atilla the Hun and Randle Patrick McMurphy (as played by Jack Nicholson in "One flew over the cuckoos nest." The reason for this is quite logical and comes down (as many things in our society do) to hard, cold cash and profitability.

If the retailer sells you a TV for cash, they might make a profit of £20.00 but if they sell you a  finance package, they could stand to increase it to £50.00 or even more. It therefore stands to reason that they would rather you took the finance. If they can convince people they can afford to make the payments, they make two sales!

People have been misguided and tricked into believing they were better off than they actually were. They have been advised and pressured into buying homes they couldn't really afford to own and maintain in order to escalate the already hyped up prices even further. Why do this? The great god "Profit" again. The ones who gained the most? The ones lending the money and those dealing with the sale of property of course.

The time of reckoning has dawned and it seems we're in for a pretty rough ride to try and get back on track. Prices are spiralling either upwards for goods and essential services, or downwards for properties and vehicles. Wages have stagnated for years and we're already being warned not to expect a pay increase because of the harm it may do to the economy.

At last the UK population seem to be understanding the wisdom of the words, "Only spend what you can afford," which should stand for the Government as well as the populous. The rate of national borrowing is at an all time high and likely to go higher. The figures not only don't balance, they're getting further apart.

We need to look at waste management in the UK and by this I am not talking about refuse collections. Our country is mal-managed and there are enormous inefficiencies, particularly in areas such as local Government and the health service. In many cases there are as many managers and supervisors as actual workers. No wonder the costs are therefore out of control and excessively high.

People should be paid on results, not qualifications or friendships. The whole system needs a massive shake-up if we're to get back to being a competitive and prosperous nation. Good normally comes out of adversity and this shock wake-up call should be a trigger for prompting positive and far reaching action to put us back where we belong; a leading world figure.

There need to be new ways of providing housing, health care and services. Tougher laws to protect people from the lawless minority who cost the most and deliver least. New ways of teaching standards so children can aspire to be the best they can at all they do and feel motivated to do so. We need to put the pride back in Briton!!!

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