ESRI says we need more "progressive" taxes lol

Antares35

IngazZagni wrote: »

So paying a billionaire and someone on the minimum wage the same amount in child benefits is the correct thing to do?

I would have thought the left could be in favour of such a thing?

The problem is it isn't just the billionaires they will take it off. It will be the squeezed middle as usual, who lose out. They think anything over 34k is fair game for the higher rate of tax - you really think they'd leave the same people with CB payment?

I see sheep

Fred Cryton wrote: »

Wanderer78, KyussB and Murph85....what is this, the Commie and Socialist support group? Can you get off my thread please, you kids need to go back to school.

:pac: Are you American?

fliball123

Wanderer78 wrote: »

we must also realise, not all private sector economic activities are truly beneficial to all, many private sector industries are largely engaging in rent seeking behaviors, which is in fact just simply extracting wealth and money from the economy, reducing overall economic activities. we need to create economies whereby we reduce these kind of outcomes, preferably eliminating them, which wont be easy, by having some sort of symbiosis between both public and private sectors

So how does that narrative play into the fact that the PS will be getting 3 pay rises in the within the next year or two and the amount spent will be asked for by raises in taxes by everyone. The symbiosis you talk about has never existed.

You may be right about some private sector activity not being beneficial at all financially but you can say this about the public sector as a whole financially the general public get p1ss poor services in an awful lot of areas for what they pay. If a private sector company acts like this they wont be in business long. So the behaviors are different. Private sector you can only get away with debt, deficit and bad work practices for so long the private sector looks after itself as the company goes out of business or the employee gets sacked. The same cannot be said for the public sector and while this differential says in place the symbiosis you talk about will never be achieved. It is something that we should be pushing for but your talking about the government on one side having to engage with unions on the other. I mean who in their right mind are going to go out of their way make life harder and less financially attractive to themselves when they have the power to keep the status quo.

Wanderer78

fliball123 wrote: »

So how does that narrative play into the fact that the PS will be getting 3 pay rises in the within the next year or two and the amount spent will be asked for by raises in taxes by everyone. The symbiosis you talk about has never existed.

You may be right about some private sector activity not being benefaction all financially but you can say this about the public sector as a whole financially the general public get p1ss poor services in an awful lot of areas for what they pay. If a private sector company acts like this they wont be in business long. So the behaviors are different. Private sector you can only get away with debt, deficit and bad work practices for so long the private sector looks after itself as the company goes out of business or the employee gets sacked. The same cannot be said for the public sector and while this differential says in place the symbiosis you talk about will never be achieved. It is something that we should be pushing for but your talking about the government on one side having to engage with unions on the other. I mean who in their right mind are going to go out of their way make life harder and less financially attractive to themselves when they have the power to keep the status quo.

yes the optics of public sector rises is really bad, but its important to remember, an increase in pay, in either the public or private sector causes an increase in economic activities overall, as theres more money available for the economy to do so. we must always remember, taxation generally doesnt go directly towards running public services, its ultimately being used to service the debts that are being used to run these services.

yes, we are currently receiving dreadful outcomes from some of our public services, the most obvious being the health system, theres clearly serious management problems occurring there, and we need to address them immediately after covid, in which i suspect we wont, i suspect we ll just do the normal, i.e. increase the budget, with little or no change!

we also need to get over this idea that the private sector is absolutely perfect, its absolutely not, private sector businesses are regularly bailed out, regularly propped up, as they are right now, its amazing we re still having these discussions, after the largest bailout period in human history! theres a long long history of many private sector businesses operating under such conditions, and we re still pushing this one, come on now folks

Murph85

Fred Cryton wrote: »

Wanderer78, KyussB and Murph85....what is this, the Commie and Socialist support group? Can you get off my thread please, you kids need to go back to school.

What are you talking about ? I'd scrap child benefit entirely, we fomt want career welfateists having kids, they cost the state a fortune. Give the mid to high income earners incentives to have them. The opposite situation of what we have now

Wanderer78

Murph85 wrote: »

What are you talking about ? I'd scrap child benefit entirely, we fomt want career welfateists having kids, they cost the state a fortune. Give the mid to high income earners incentives to have them. The opposite situation of what we have now

...so what should we do, in order to support parents that cannot afford to support their kids?

fliball123

Wanderer78 wrote: »

yes the optics of public sector rises is really bad, but its important to remember, an increase in pay, in either the public or private sector causes an increase in economic activities overall, as theres more money available for the economy to do so. we must always remember, taxation generally doesnt go directly towards running public services, its ultimately being used to service the debts that are being used to run these services.

yes, we are currently receiving dreadful outcomes from some of our public services, the most obvious being the health system, theres clearly serious management problems occurring there, and we need to address them immediately after covid, in which i suspect we wont, i suspect we ll just do the normal, i.e. increase the budget, with little or no change!

we also need to get over this idea that the private sector is absolutely perfect, its absolutely not, private sector businesses are regularly bailed out, regularly propped up, as they are right now, its amazing we re still having these discussions, after the largest bailout period in human history! theres a long long history of many private sector businesses operating under such conditions, and we re still pushing this one, come on now folks

OK I actually agree about the more money available for the economy but why not reduce USC and let everyone have more money back in their pocket or do a huge cut in taxation.

Giving this pay rise means we give the PS (300k employees) a rise and the other 1.1/1.2 million private sector employees pay more as they have to pay more in tax for it. So yeah 300k will have more to spend and 1.1. million will have less.

Wanderer78

fliball123 wrote: »

OK I actually agree about the more money available for the economy but why not reduce USC and let everyone have more money back in their pocket or do a huge cut in taxation.

Giving this pay rise means we give the PS (300k employees) a rise and the other 1.1/1.2 million private sector employees pay more as they have to pay more in tax for it. So yeah 300k will have more to spend and 1.1. million will have less.

ideally yes, a reduction in taxation, but theres a point whereby you cant run your economy, i.e. if a country is unable to service its debts, its in trouble. modern political ideologies dictate that taxes are continually removed from wealth, and moved towards labour and consumption, this is now running its course, we are becoming increasingly unable to run our economies and societies effectively by continually doing so, and by trying to do so, ultimately we re endangering everyone in the process.

again, we must move away from this thinking that our taxes are going directly towards running our public services, theyre largely going towards servicing the debts that are being used to run our public services.

fliball123

Wanderer78 wrote: »

ideally yes, a reduction in taxation, but theres a point whereby you cant run your economy, i.e. if a country is unable to service its debts, its in trouble. modern political ideologies dictate that taxes are continually removed from wealth, and moved towards labour and consumption, this is now running its course, we are becoming increasingly unable to run our economies and societies effectively by continually doing so, and by trying to do so, ultimately we re endangering everyone in the process.

again, we must move away from this thinking that our taxes are going directly towards running our public services, theyre largely going towards servicing the debts that are being used to run our public services.

Well if that is the case for no reduction in taxes then the same case must be made for public sector pay rises you cant have it both ways. Our taxes do go to pay for public services regardless of debts or not. Its like saying your not paying for your house because your paying the bank who you got the mortgage off.

ThunbergsAreGo

Wanderer78 wrote: »

...so what should we do, in order to support parents that cannot afford to support their kids?

They could not have the kids...

Or vouchers for essentials

WrenBoy

"But we need to increase the population to help pay for future pensions",,, then turn around and make it harder for people to afford to have more children. Clearly our best minds are at the wheel

Fred Cryton

Fred Cryton wrote: »

Wanderer78, KyussB and Murph85....what is this, the Commie and Socialist support group? Can you get off my thread please, you kids need to go back to school.

Given that they provide well thought out and constructive posts I can see why you wouldn't want them here.

fliball123

WrenBoy wrote: »

"But we need to increase the population to help pay for future pensions",,, then turn around and make it harder for people to afford to have more children. Clearly our best minds are at the wheel

Well just to spin that some have no bother popping kids out like smarties , its when you have bills to pay and jobs to do that the issues of affordability for kids is a problem. Its like if you have even a half decent job they don't want you having any kids or at least that how they have set the game up

fliball123

fliball123 wrote: »

Well just to spin that some have no bother popping kids out like smarties , its when you have bills to pay and jobs to do that the issues of affordability for kids is a problem. Its like if you have even a half decent job they don't want you having any kids or at least that how they have set the game up

Two of my friends run their own businesses have a clatter of kids, six in one and eight in the other, both wives work full time.

They are outliners of course the majority of my friends have three and both parents work.

It can be done obviously because the majority of people do it, but personally having kids wouldn't be for me.

Necro

Fred Cryton wrote: »

Wanderer78, KyussB and Murph85....what is this, the Commie and Socialist support group? Can you get off my thread please, you kids need to go back to school.

The only person getting off this thread is you - Don't post here again

KyussB

fliball123 wrote: »

Have you looked at the challenges our corporation tax is facing? Up to half of what we take in could be going. If that happens our GDP will fall off a cliff. I agree we can borrow forever if there is a someone out there willing to lend. Now once the ECB have turned off the taps do you think the markets are going to lend to us unless they put a nice big fat margin on top for the risk they take. I reckon it will not be too long before no one in the market will lend to us as looking at Ireland now we are in a much bigger hole than after the last crash.

As rare as the deficits are we actually had one in 2019 - we had our rainy day fund. That fact alone would suggest to me that the debt is too large and is going to cause us major problems borrowing into the future.

We were the third most in debted country in the world in 2019 and we are the already in 2021 we are the highest debt per head in Europe this year.

https://www.irishtimes.com/business/economy/ireland-to-have-highest-debt-per-head-in-europe-this-year-1.4503652

We will see where we are after corona is gone I reckon with in 5 years we will be in a postilion where we will only be able to borrow from the lender of last resource they will ask us to get our house in order.

So in theory you can borrow on the never never but hard choices are going to have to made that will means cuts , tax increases and austerity for all basically something like what happened in Greece in order to keep borrowing.

I would rather we were trying to get our spend in order before being told to do so

You are comparing Euro Crisis era ECB to present day "whatever it takes" policies ECB.

"Whatever it takes" ECB means that the markets follow the ECB rate closely, regardless of what part of the economic cycle we're at.

The ECB effectively has powers now, which it did not have during the Euro Crisis. This means we're not going back to the Euro crisis. Markets don't set rates, markets do not decide a country can not be lent to (because the Euro Crisis and threat of being exited from the Euro is gone) - the ECB sets rates (the level of indirection with markets does not change this), and the ECB's "whatever it takes" policies guarantee no Euro Crisis and thus no lack of lending.

This keeps on being ignored, and several posters keep on going back to the wrong "but the markets" view, here.

With the ECB's current abilities market influence over government bonds is only a facade.

KyussB

fliball123 wrote: »

So what happens if they dont spend at the rate that is needed to plug a 17Billion and rising deficit? Its one hell of a gamble.

The government deficit is just a meaningless accounting figure. It's like looking at a cars RPM gauge to judge its speed.

If your economy is below Full Output i.e. Full Employment, then you're wasting billions - quickly tens of billions - of lost economic potential. Time lost and work that could have been done, which wasn't done - time/labour that could have been spent doing useful things, like e.g. building a fuckload of houses - which will never be gotten back.

The only gamble is staying below Full Output/Employment.

KyussB

timmyntc wrote: »

Full output is economic theory and doesnt actually have a hard and fast meaning - full employment usually, but one mans full output and anothers are totally distinct. Full employment from mostly private sector jobs is much healthier for govt finances than full employment from mostly public sector. Full output is a wishy-washy term used by economists who dont live in the real world. The reality is its not quantifiable, theres an argument you could always be chasing full output - and when you have noone else left to work, you can import more labour - do you go beyond full output then?

Full Output is a standard part of economic discussion, it's no more theoretical than GDP/GNI/GNI* - and calculations of it and the Output Gap aren't open to moral interpretation of what type of work counts or not.

If the Private Sector doesn't want workers, nobody should tell those workers they have to sit idle until they are wanted - our entire lives are built around earning our living - it's a breach of human rights to leave people involuntarily unemployed.

The most sensible program, is to hire the workers the private sector doesn't want, into useful work at a living wage - until the private sector wants them again. That's the Job Guarantee policy.

RandomViewer

KyussB wrote: »

Full Output is a standard part of economic discussion, it's no more theoretical than GDP/GNI/GNI* - and calculations of it and the Output Gap aren't open to moral interpretation of what type of work counts or not.

If the Private Sector doesn't want workers, nobody should tell those workers they have to sit idle until they are wanted - our entire lives are built around earning our living - it's a breach of human rights to leave people involuntarily unemployed.

The most sensible program, is to hire the workers the private sector doesn't want, into useful work at a living wage - until the private sector wants them again. That's the Job Guarantee policy.

Employers like a level of unemployment, it keeps wages down

KyussB

fliball123 wrote: »

Well if that is the case for no reduction in taxes then the same case must be made for public sector pay rises you cant have it both ways. Our taxes do go to pay for public services regardless of debts or not. Its like saying your not paying for your house because your paying the bank who you got the mortgage off.

You're making a comparison between personal finances and government finances, when they operate completely differently.

There is no meaningful comparison between the two - many fundamental differences have been highlighted in the thread many times - not least, being that governments roll over debt forever (practically never reducing the stock of debt, only increasing - different to vs GDP).

KyussB

RandomViewer wrote: »

Employers like a level of unemployment, it keeps wages down

Exactly - that's the primary reason things like the Job Guarantee are lobbied against - low unemployment means higher worker bargaining power, and businesses don't want that.

The Job Guarantee would still aim to set a low wage compared to the private sector (but still a living wage) - so while it would not compete on wages (that would be undesired in many ways, except for setting living wage as a standard), it will bolster worker bargaining power by ending unemployment and the threat of loss of livelihood.

Beasty

KyussB wrote: »

The government deficit is just a meaningless accounting figure.

Wow!!

Seriously? Deficits have to be funded. Debt has to be financed. Interest rates will not stay low indefinitely (the pandemic is already causing significant inflationary pressures with raw materials going up, which will have an impact on business generally, and the housing market in particular). So house prices are likely to go up when interest rates are starting to rise. A recipe for disaster.

Pa ElGrande

KyussB wrote: »

. . .

This keeps on being ignored, and several posters keep on going back to the wrong "but the markets" view, here.

With the ECB's current abilities market influence over government bonds is only a facade.

The ECBs actions have destroyed the private market for EU states sovereign debt and they dare not stop how else did Irelands NTMA borrow €24bn in 2020 at an average rate of just 0.02pc and we have no idea what we may end up having to pay in interest on the tens of billions we will have to re-finance in a decade’s time when the repayments are due. There is no such thing as a free lunch, that borrowing must be paid for with our labour and eventually there comes a point when it becomes counter-productive to pay and the states default most likely in short order as happened in the 1930s.


Either the ECB retires the debt or they inflate it away, not so easy a process when the political union becomes fractious (Brexit being the opening salvo). The European treaties created the ECB with the primary function to ensure price stability . . . how it got into "climate change" supporting "green bonds" is well beyond its original mandate. These green bonds are fixed-income investment vehicles designed to generate money to fund "climate" or environmental projects and anyone who has been paying attention over the past few decades knows these are money losers (lots of red ink for green debt), we must expect our taxation levels rise in line with "net zero".

Pension funds can't buy bonds at those prices and lock in losses unless they are forced to, they will go bust, and you wonder why people are losing their minds over "cuckoo funds". Eventually ECB interest rates must be "normalised", good luck to whoever wants to grasp that nettle.


Speaking of pension funds we are getting older and retirement villages are a thing, another reason taxation is going to increase we need to fund these, future fair deal system is not going to work when people are out competed by Cuckoo funds.

That is going to place a large burden on the State’s coffers in the years ahead and private pensions do not look like they are remotely ready to fill the gap.

A study published earlier this month found that almost half of Ireland’s workers have no private pension, with 37 per cent of this cohort saying high rent and other day-to-day bills were making it impossible for them to afford it and almost one in five saying they did not know how to start a pension.

source

Today I took a ride across town on a nearly empty double-decker bus, first time in about a year. Who is funding this I asked myself? Dumb question really, that's future fare increases with taxation of my labour and consumption. There is no such thing as a free meal.

fliball123

KyussB wrote: »

The government deficit is just a meaningless accounting figure. It's like looking at a cars RPM gauge to judge its speed.

If your economy is below Full Output i.e. Full Employment, then you're wasting billions - quickly tens of billions - of lost economic potential. Time lost and work that could have been done, which wasn't done - time/labour that could have been spent doing useful things, like e.g. building a fuckload of houses - which will never be gotten back.

The only gamble is staying below Full Output/Employment.

Your argument does not hold weight and 3 things that proves you wrong, our bailout, Greece and the fact that we cant borrow from the ECB indefinitely. Lets be clear they are doing this as we are in the midst of a pandemic and for no other reason that is why its whatever it takes once Corona is gone all bets are off. As I have tried to painstakingly point out at some point in the future inflation will rise as will interest rates as will our debt and if wages dont follow in the private sector we are phucked as the public sector will no doubt keep pace with the way the system works Gov on one side unions on the other pretending to make hard decisions when its just how much more will be get that in a payrise is the only thing up for debate and that is a further expense pushed onto us. You only have to measure the two sectors 20 years ago Private sector was ahead on average now the public sector are ahead by 27%.

We will end up paying more and more for the repayments and less and less will be put aside for essential services. We cannot continue this way we may get away with it for the short term but it only takes one thing to go wrong, Interest rates going up by 1% means 2.4billion taken away from spend and going on interest repayments. The OCED tax regimes we could lose up to 6 billion annually. Increases in income tax I reckon will force people into the black market , to emigrate or to be able to work remotely from a different country and we could see less tax take coming in via income. Sinn Fein are singing from the highest tree top they will sort out the housing crisis? Just a guesstimate here but your talking 10s of billions in that one promise alone.

Are you saying that the way through all of this is just keep borrowing and borrowing and borrowing. Has this worked anywhere else globally in history? Just borrow repay the interest and forget about the debt. I would interested if you have anything of note I cant find anything?

I mean how long will it be before the Germans want the tap turned off and what happens if they do this. The troika do not make decisions for the good of the EU based on Ireland 's need to keep a cheap line of credit open. It just doesn't work like that and they already see us as cowboys with our Corporation tax rates, our public sector rates and our Welfare rates and rightly so.

KyussB

Beasty wrote: »

Wow!!

Seriously? Deficits have to be funded. Debt has to be financed. Interest rates will not stay low indefinitely (the pandemic is already causing significant inflationary pressures with raw materials going up, which will have an impact on business generally, and the housing market in particular). So house prices are likely to go up when interest rates are starting to rise. A recipe for disaster.

With the ECB's "whatever it takes" policies (completely different policies to the Euro Crisis era ECB), deficits are indirectly financed by the ECB.
Bond markets add a level of indirection to this, but with the ECB's current powers, the idea of bond markets having any control/say is just a facade.

This turns the whole idea of Government Spending being 'funded' on its head - Taxes do not 'fund' Government Spending - the ECB does not need to be 'funded' to extend money (indirectly) towards Government Spending.

Sourcing the money to keep the economy at Full Output is not a problem. Sourcing the money to keep up with any debt servicing costs is not a problem either.

The reason the deficit is a meaningless accounting figure, is because that does not measure a cost to the economy. The real cost to the economy, is being below Full Output and Full Employment - because that represents work not done, people sitting idle, stuff not produced, infrastructure not built, economic growth lost - and time wasted that could have been spent doing all of that. We and our kids pay for all of that, through having a poorer and less well developed economy in the future.

Being below Full Output quickly costs the economy multiple tens of billions in lost Output. Even the worst years of the crisis for us, had debt servicing costs only in the low single digit billions. With restoring Full Output being less costly than debt servicing, even in the worst years of the crisis - there isn't any excuse left for not doing that.

KyussB

Pa ElGrande wrote: »

...

Government bonds are not paid for with our labour. Governments roll over their stock of debt forever - and it's very easy to check this, by looking at the long term stock (not vs GDP) of debt for pretty much any country.

When EU-wide economic recovery is achieved, the ECB will likely raise interest rates. However - interest rates (and monetary policy in general) are a poor/inaccurate method of managing inflation/deflation - which are being replaced with use of tighter bank lending restrictions and fiscal-policy/taxes instead. This will lead to interest rates being parked at zero permanently - after all, why should we pay interest to people who hold money, just for holding it?

As my post above explains, under current ECB policies Taxes do not 'fund' Government Spending - invalidating the parts of your post based on that assumption.

fliball123

KyussB wrote: »

Government bonds are not paid for with our labour. Governments roll over their stock of debt forever - and it's very easy to check this, by looking at the long term stock (not vs GDP) of debt for pretty much any country.

When EU-wide economic recovery is achieved, the ECB will likely raise interest rates. However - interest rates (and monetary policy in general) are a poor/inaccurate method of managing inflation/deflation - which are being replaced with use of tighter bank lending restrictions and fiscal-policy/taxes instead. This will lead to interest rates being parked at zero permanently - after all, why should we pay interest to people who hold money, just for holding it?

As my post above explains, under current ECB policies Taxes do not 'fund' Government Spending - invalidating the parts of your post based on that assumption.

OK then can I ask one simple question if you think this is true. Where does the money we pay in taxes go then?

KyussB

fliball123 wrote: »

Your argument does not hold weight and 3 things that proves you wrong, our bailout, Greece and the fact that we cant borrow from the ECB indefinitely. Lets be clear they are doing this as we are in the midst of a pandemic and for no other reason that is why its whatever it takes once Corona is gone all bets are off. As I have tried to painstakingly point out at some point in the future inflation will rise as will interest rates as will our debt and if wages dont follow in the private sector we are phucked as the public sector will no doubt keep pace with the way the system works Gov on one side unions on the other pretending to make hard decisions when its just how much more will be get that in a payrise is the only thing up for debate and that is a further expense pushed onto us. You only have to measure the two sectors 20 years ago Private sector was ahead on average now the public sector are ahead by 27%.

We will end up paying more and more for the repayments and less and less will be put aside for essential services. We cannot continue this way we may get away with it for the short term but it only takes one thing to go wrong, Interest rates going up by 1% means 2.4billion taken away from spend and going on interest repayments. The OCED tax regimes we could lose up to 6 billion annually. Increases in income tax I reckon will force people into the black market , to emigrate or to be able to work remotely from a different country and we could see less tax take coming in via income. Sinn Fein are singing from the highest tree top they will sort out the housing crisis? Just a guesstimate here but your talking 10s of billions in that one promise alone.

Are you saying that the way through all of this is just keep borrowing and borrowing and borrowing. Has this worked anywhere else globally in history? Just borrow repay the interest and forget about the debt. I would interested if you have anything of note I cant find anything?

I mean how long will it be before the Germans want the tap turned off and what happens if they do this. The troika do not make decisions for the good of the EU based on Ireland 's need to keep a cheap line of credit open. It just doesn't work like that and they already see us as cowboys with our Corporation tax rates, our public sector rates and our Welfare rates and rightly so.

You are comparing Euro Crisis era ECB policies, with the "whatever it takes" ECB of today which has much greater powers for stopping such crises coming about in the first place.

Your post also makes the critical mistake of saying interest rates affect the whole stock of debt causing a 2.4 billion cost - when that is false, interest rates only affect debt that is rolled over.

Raised inflation reduces the 'real' cost of the whole stock of debt - raised interest rates only affect rolled over portions of the debt.

Even throughout the worst years after the GFC our Debt Servicing cost was in the low single digits - while the cost of being below Full Output was in multiple tens of billions - so there is no circumstance you can point to where raised interest rates cost us more than being below Full Output.

fliball123

KyussB wrote: »

You are comparing Euro Crisis era ECB policies, with the "whatever it takes" ECB of today which has much greater powers for stopping such crises coming about in the first place.

Your post also makes the critical mistake of saying interest rates affect the whole stock of debt causing a 2.4 billion cost - when that is false, interest rates only affect debt that is rolled over.

Raised inflation reduces the 'real' cost of the whole stock of debt - raised interest rates only affect rolled over portions of the debt.

Even throughout the worst years after the GFC our Debt Servicing cost was in the low single digits - while the cost of being below Full Output was in multiple tens of billions - so there is no circumstance you can point to where raised interest rates cost use more than being below Full Output.

I made no mistake as all debt will be rolled over at some stage in the future and if they are using the system your talking about if interest rates go up by 1% we will be paying 2.4billion on the 240billion of debt at some point in the future.


So if our taxes dont fund government spending as you outline where are the billions of taxes we pay?

tjhook

KyussB wrote: »

Sourcing the money to keep up with any debt servicing costs is not a problem either.

Could you please explain this? Are you saying that no matter how large the debt, there's no problem servicing it?

Surely the cost of servicing it is defined by the size of the debt and the interest rate. And since we cannot (as a country) set the interest rate at will, all we can do is control the size of the debt? I.e. not borrow more than is sensible?

As a silly extreme example, surely we would be in trouble if we borrowed a trillion euros for some expensive scheme (e.g. like the USA is spending $1.5 trillion on the F35 fighter programme). Assuming the interest rate will be non-zero at *some* stage, the cost of merely servicing this debt would then use up any income the state has. And with a debt that size, who would lend more to us?

The trillion euros is a silly figure, but surely there's *some* line beyond which we can't increase borrowings. So while we can carry and service a debt forever, there is a limit to increasing it? And once we reach that limit, we must fund all spending ourselves, plus service the existing debt?