Today the UK’s government announced massive cuts in its spending review targeted at reducing the country’s spending prior to 2015.
The cuts are broad, and target everything from defence to welfare. Some examples:
- Retirement pension age to increase to 66 by 2020.
- 490,000 public jobs to be cut
- Royal family spending cut 14%
This chart shows just how bad the borrowing problem is for the UK right now. From our estimation, the country currently has to borrow money to pay for a part of its governance equal to education and defence.
The government argues that, last fiscal year, the government borrowed one in every four pounds it spent.
We’re somewhat curious what this would look like for the U.S.
From the UK spending review:
Photo: HM Treasury