UK DEBT IN PERSPECTIVE

In the period from the middle of the eighteenth century until well into the second half of the twentieth century – the period often referred to as ‘modern economic growth’ and the tail-end of which from 1950 to 1973 is usually referred to as ‘the golden era’ – the debt/income ratio was above 100 per cent over 75 per cent of the time. [...] The origins of the British national debt lie with the 1688 Revolution and the ensuing hostilities with the France of Louis XIV. [...] Towards the end of the Thatcher era, when the global economy was still adjusting to the restrictive monetary policy measures needed to tame the Great Inflation of the 1970s, it seemed reasonable to assume that interest rates exceeded the economy’s growth rate. [...] After the Napoleonic Wars, there were also demands for greater probity in the affairs of the state and a return to the gold standard that had been abandoned in the early years of the war. [...] The beginnings of the dismantling of mercantilism meant that much of the old had gone by the end of the eighteenth century but much persisted into the nineteenth.