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Economic Growth and Employment

Let me just finish this argument. Some of us have argued for a long time that the underlying problem is that, since the beginning of the crisis, the British economy has suffered—I use my own metaphor— the economic equivalent of a heart attack. There is a profound problem, and what lies behind it is the fact that, more than any other developed country, we have quite extraordinary levels of debt. There are different kinds of debt. Household debt is 160% of gross domestic product and, after the boom that took place under the previous Government, it is higher than in other developed countries. Banks' balance sheets are more than 400% of GDP, after they were allowed to run out of control. Government debt is 180% and rising as a result of the deficit financing we had to undertake. If we put those things together, as McKinsey has done, they show that the position we inherited is one where total debt in the UK is approaching 500% of our GDP. The only other country with a problem of that scale is Japan. That is the inheritance we are now seeking to manage.