13k per household

[New_Economic_Agenda]

If you take 20 billion and divide by 2 million workers its around 10 grand for each worker

yea, that's a neat way of looking at it.

remember that's the deficit, the extra, each worker owes, on top of what they already contribute

it can be recouped in increased income taxes, but also through increased VAT receipts, Stamp Duty, and any new taxes the government invents

considering that consumer confidence is low, the consumer is not spending as much, VAT receipts are down, and falling, and there is no sign of a housing market re-boot, the government will have to rethink how they collect taxes

A property tax on second homes is the most obvious thing - but there will be shouts of 'unfairness' on the basis that anyone who bought a second home already got hit with stamp duty. Still it will happen

I would bet a household carbon tax will also be on the cards

these measures won't amount to 10k per worker though - that much is certain

thus the current public spend must also be targeted, over and above the pension levy

i would start with public sector pensions above a certain threshold - anything above 80k for instance - levy the sh1te out of them

reign in benchmarking

that sort of thing

we could probably survive a current year 20 billion hit - on the basis that we are continuing to raise the money on the primary bond market

the problem will be if we have three successive years of deficit in that range, i.e. if we are still running a budget deficit of 10% in 2010

... that's meltdown territory

not least because our credibility with investors will be weak

if we suffer a bond market failure the matter falls out of our hands - it wouldn't matter what we did domestically - we would need a bail out

as things stand i would guess we'll be market critical by May 2010

[atlantic]

I believe it will be higher than twenty billion,even if you exclude capital expenditure.
The amounts of people going on the dole by the end of the year will be nearly 500,000.
It costs nearly 60 billion to run this country and we will be lucky to take in 35 billion.

I think though that the 20 bn might be just a touch pessimistic. That includes a lot of capital expenditure which can be postponed, and we can still run at a 3% deficit, which is close to 2bn. So if we cut, say, 4bn and run a deficit we have to come up with 14bn, which is still 7 grand a head but not quite so bad.

But this is only money which is transferred to the state. This doesn't count money lost through the recession - lost income inthe private sector.

[tic tac man]

I believe it will be higher than twenty billion,even if you exclude capital expenditure.
The amounts of people going on the dole by the end of the year will be nearly 500,000.
It costs nearly 60 billion to run this country and we will be lucky to take in 35 billion.

But the oft-quoted 60bil figure for the budget is actually more like 57Bil, and includes capital expenditure.

Things are bad and I don't want to downplay them, but a deficit of about 15Bill seems doable to me. Which is still about three times what's acceptable.

Elsewhere, did I see that Obama's budget is set for a 12% deficit?