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    By J.D. Neeson, President, Marine Parts Express

    It struck me the other day that everyone talks about government debt and how much personal debt people have, but I had never seen what the total debt is. So here is a nifty table showing some of these. All the numbers are a percentage of a country’s GDP and are estimates.

    Country % GDP % Government Debt % Business/Bank Debt % Household Debt
    UK 497 77 340 80
    Japan 492 213 226 53
    Spain 366 66 210 90
    France 341 88 223 30
    Italy 313 110 165 38
    South Korea 306 30 186 90
    US 289 80 124 85
    Germany 284 86 149 49
    Canada 274 68 118 88

    So, in the United States, the total debt is 289% of GDP and out of this number 80% of GDP is Government Debt, 124% of GDP is Business/Bank Debt and 85% of GDP is Household Debt. Or, to phrase it another way, as a percentage of total debt, which is a bit more revealing of the government and societal pressures that countries have to deal with and the decisions that are made either consciously or unconsciously.

    Country % Government Debt % Business/Bank Debt % Household Debt
    UK 15 68 16
    Japan 43 46 11
    Spain 18 57 25
    France 26 65 9
    Italy 35 53 12
    South Korea 10 61 29
    US 28 43 29
    Germany 30 52 17
    Canada 25 43 32
    Average Rate 26 54 20
    Median Rate 26 53 17

    There are all sorts of observations and deductions that can be made from these numbers. For example, I think what it shows is that while Japan and France have relatively low Household Debt they have higher than average Government and Business/Bank Debt. But the reasons for this are different. Japan has a history of high personal savings, but the country has been forced to keep society afloat through government support of its industries.

    The French, on the other hand, have forced their industries to keep artificially high wages and benefits by government edict. That has kept Government Debt down, but has forced businesses to take up the slack. Much of the needs of the French people are supplied by either the government or by their employers, so personal debt is lower.

    Another example is South Korea and the United Kingdom, both of which have relatively low Government Debt. Again, it is for different reasons. The Koreans are much more hands off when it comes to economic issues type forcing industry or households to take on the debt risk, while the U.K. form of socialism controls the economy more closely and forces industry to take on the debt.

    You notice none of these broad generalizations include efficiency or value considerations and there are all sorts of other factors that create the choices that countries make. The only aspect that seems clear is that less debt is better than more debt and more capitalistic economies seem to spread debt risk over the entire economy more than the socialistic countries that either dictates the entity that will be the debtor or take the debt onto themselves.

    I have no idea which is better, but this decision may affect which class of borrower has the most say in the governing of the country. In all cases, the beliefs and societal mores can tie the hands of decision makers more effectively than laws passed.

    I would love to find the same sort of numbers for China, Dubai, or some other very strictly controlled economy more totalitarian form of government and compare it with the numbers for Sweden or Denmark. And wouldn’t poor Greece’s or Portugal’s numbers be fun to look at?

    ~J.D. Neeson


    Comments? Questions? Suggestions for topics for our blog or newsletter? Send them to
    info@marinepartsexpress.com.

    Marine Parts Express is a division of Water Resources, Inc., a privately held Maine Corporation.

    For all your marine engine parts needs, call us toll free at 877.621.2628, or outside the U.S. at 207.882.6165.

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    Categories: Economy, JD Neeson

    Tags: Economics, Economy, Financial Crisis

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Recent Posts

  • Things I Found While Looking For Something Else – Part VI
  • Re-Introducing the OneList
  • Winterization Guide
  • Labor Day Sale 2016
  • Memorial Day Sale 2016
  • Turbocharger Damage Prevention Bulletin
  • The Art of Quilling
  • Winter – Maine Style
  • XDP Upgrade Promotion – Extended!!! (through 12/31/14
  • Lubricants, Oils, Sealants, and Adhesives – Discussion and Cross-Reference

Tag Cloud

    american goldfinch bird feet configuration Birds blue jay brown creeper cardinals China debt Downy Woodpecker Economy ethanol flame arrester flame arrestor gear ratios hermit thrush hummingbirds low flow lubricants Lytro magnetic alignment magnifying glass magnolia Maine maine authors maine golf maine hunting camp maine winter manufacturing Margaret Graham Neeeson Margaret Graham Neeson Marine Parts Express mercruiser oriole osprey overheating propeller prop sizes Ruby-Throated Hummingbird sail drive service bulletin The Skipper volvo volvo penta wild turkey Winter

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