1/27/2010 9:40:00 AM
National debt could top half a billion dollars
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 | Larry Burchall
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Lazy? Read no further. Only want to hear good stuff? Stop here. Want honest facts? Read on.
The Ministry of Finance's blue Budget Book reports that on March 31st 2007, Net Public Debt was $198,159,000. In December 2009, reporting to the House of Assembly, the Minister for Finance reported that "Net Public Debt" now stood at $483,300,000.
Since March 31st 2007, Government had added $285,141,000 to our Public Debt - commonly called our National Debt.
The combination of recent overspends (cost over-runs for the dock at Dockyard; Port Royal Golf Course re-shaping; new Court House building; current account overspends in this Financial Year [2009/2010]) adds to about $91,000,000.
Add this overspend to the $30,000,000 shortfall in government revenue in 2009, and then toss in the expected lower tax revenue for this coming Financial Year. Clearly, Finance Minister Paula Cox will have to make up for her allowing these past over-spends as well as for facing future reductions in tax revenue.
For April 1st 2010, in order to get through the next Financial Year, Minister Cox will be fishing around for as much as an additional $150,000,000.
You and I know that she does not have a money-tree in her back yard. Nor is there a secret stash in those paid-for but unused Washington DC offices.
You and I know that she will have to either cut back materially on Civil Service staffing levels - which she and this Brown-led Cabinet will not do. Cut back significantly on delivering or providing government services - which, again, she will not do. Broadly raise overall tax receipts by ten percent (or more) which, in this stressed global situation would be economically stupid - though she is neutered, she is not stupid. Borrow more money - which is what she will end up having to do.
Minister Cox will have to borrow at least $100,000,000 (could be as high as $150m) to see her through FY 2010/2011. That means that Bermuda's Public Debt is poised to zoom way past half a billion dollars. It will likely hit $600,000,000 or more - tripling in just three years.
By April 1, 2010, this Brown/Cox Cabinet will have added at least $385,000,000 and possibly as much as $435,000,000 to Bermuda's Public Debt. Looked at another way, since March 31st 2007, during the past three years, this Brown/Cox combination will have been overspending by more than $128,000,000 every year.
With $385,000,000 (or $435,000,000) of additional debt dumped on us 50,000 Bermudians by this Brown/Cox combo, what, exactly, is there to show?
New Hospital? Additional Golf Courses? Improved St George's Town Cut channel? Public Education fixed? Lower crime ?
There is nothing to show. Nothing except DNA proof of massive and sustained financial mismanagement.
From today and going forward, who can you trust to manage Bermuda's public purse? Surely not the same overspending combo?
Now that you know the true and real extent of this Brown/Cox government's pattern and habit of overspending, what, exactly, does their $128,000,000 annual overspend mean?
It means $2,461,538 overspent every week (52 weeks). It means $350,685 every day (365 days). It means $14,612 every hour (24 hours). It means $243.53 every minute (60 minutes in an hour). Incredibly, it means that $4.06 is overspent every second (60 seconds in every minute) and is faster than any 'sailor' could spend.
If you used 50 seconds to read this far, government would have overspent $200. This is massive haemorrhaging. Reckless overspending. It never stops. It happens even while you are sleeping and sitting on the toilet.
Like an overdraft, overspent funds are borrowed funds. So the monthly interest and other charges get higher and higher (at least a 'sailor' is spending the money that he has earned).
First, though, that $200 has to come out of your pocket! First, you have to work and earn it. Then government tax collectors appear and loftily declare that what is yours must become theirs. Government jams its hands into your pocket and grabs. Government then recklessly overspends and creates new debt - leaving you to pay the charges!
Going forward, who can you trust to manage the public purse?
What is national debt?
The Government puts a credit card in every Bermudian's pocket (new-born babies, too). The CC shows $12,000 owing ($600,000,000 total debt shared between 50,000 Bermudians - babies, too). Thankfully, the Government does not want you to pay that CC balance today. Instead, the Government makes you keep paying the monthly charges. The Government can increase the CC 'limit' and then charge more to the CC. However, you will pay the higher monthly charges.
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Posted: Friday, February 05, 2010
Comment by:
To Sandgrownan:
Thank you for the compliment. Glen Beck was just rated #2 on TV. Fox News which carries Glen Beck, has just had an increase in it's ratings by 55%, year to year, yet the idiot Keith Obermann from MSNBC was singled out for his lunacy, and MSNBC's ratingg plummeted by 44%.
YOU DO THE MATH!!!!
Posted: Friday, February 05, 2010
Comment by:
Sandgrownan
You sound like Glen Beck.
Posted: Wednesday, February 03, 2010
Comment by:
TO Sandgrownan
Give it up once and for all!!!! obama has quadrupled the national debt of the States, has attempted to ram down everyone's throats socialist and perhaps communist ideologies,which will destory the U.S in all ways possible, and none of these ugly scenarios were initiated by Bush.
Posted: Wednesday, February 03, 2010
Comment by:
Sandgrownan
To Sandgrownan: I see you stopped short of calling him a socialist. Go look up what it means, then come back to me.
Let me put it another way, the previous 8 years didn't happen?
Posted: Wednesday, February 03, 2010
Comment by:
To Sandgrownan:
obama did not inherit the TRILLIONS & TRILLIONS of dollars of debt. All this insanity is the product of obama's sick mind. Stop blaming others for obama's insane behaviour!
Posted: Tuesday, February 02, 2010
Comment by:
SBT
So, Laverne thinks we shouldn't listen to what Larry has to say because he only got his Cambridge School Certificate, and from Berkeley Institute at that! Judging from his brilliant article it appears that he must have received an "A" in Maths AND in English Language because he's got all the figures right, and he has written a cogent, well researched article. Perhaps Laverne should hire him to write a series of insightful articles in the Worker's Voice so that our workers finally hear the truth about what is going on in the country they have worked so hard to build. Sorry, I rescind that suggestion - printing intelligent well-informed articles these days in the Workers Voice is an oxymoron. However, I do admire Laverne for sticking to her principles - and attacking the messenger for bringing bad news. Sort of reminds me of the attacks against another Larry, by another staunch BIU leader. We now await character assassinations of the new Auditor General for singing EXACTLY the same song as her predecessor.
Posted: Tuesday, February 02, 2010
Comment by:
Sandgrownan
BERMUDA TAKE NOTE: Not exactly analogous, Obama inherited a deficit and recession, the PLP inherited a budget surplus and strong economy.
Posted: Sunday, January 31, 2010
Comment by:
BERMUDA TAKE NOTE:
obama has been doing the same nightmarish thing to the States. From out of nowhere, obama wants America to incur TRILLIONS & TRILLIONS of debt which would destroy the U.S. financially. Do NOT let Bermuda fall into the same insane financial hole.
Posted: Friday, January 29, 2010
Comment by:
Letariatpro
One WOULD think that Minister Paula Cox and her team at the Finance Ministry would know more than he...Wouldn’t one. The personal attacks by LaVerne are getting so obviously transparent and desperate. Paula Cox should step down in shame, as should the premier, when he gets back from his world tour...
Posted: Thursday, January 28, 2010
Comment by:
thascrazytalk
LaVerne, they're spending our money like drunken sailors, increasing the country's debt by almost exactly $100,000,000 per year, the finances can't pass an audit (so God knows where the money is actually going), and you think the most important comment you can make is about the schools Mr. Burchall went to? That really is lame (though not surprising).
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