The Guardian: Britain - Stuart Jeffries and Stephen Moss on "who would gain from a recession in the UK"

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Britain - Stuart Jeffries and Stephen Moss on "who would gain from a recession"

Recession is very good news for economic pundits and for debt collectors. Suddenly the terms "credit crunch" and "sub-prime mortgages" are on everyone's lips - and on every front page. Economists, who in the past had to play second fiddle to political analysts, are now in great demand - witness the deification of viewer-friendly economics guru Evan Davis at the BBC and the ubiquity of the corporation's business editor Robert Peston, despite his curious way with the English language.

Mortgage repossessions are expected to rise by 50% this year, according to the Council of Mortgage Lenders. In 2007, about 30,000 homes were repossessed and the CML expects that figure to rise to 45,000 this year. The signs that a sizeable minority of Britain's 12 million mortgage holders are starting to struggle with their repayments are already there: more than 500,000 have missed a mortgage payment in the past six months. Mortgage repossession is not the only form of debt collection that is likely to boom during a recession. According to credit action.org.uk, the UK's burden of debt grew by 9.3% last year, with personal debt standing at euro 1,882.77bn at the end of December, and Britain's level of personal debt rising by euro 1.34m every five minutes. Partly as a result, the money-advice website claims that more than 7,716 loan repayments go unpaid every day, that Citizen Advice Bureaus will deal with 6,600 debt problems each day, and that 305 people will be declared insolvent or bankrupt each day. In a recession, these figures will increase. The debt industry is sure to be in profit over the next few years.

Note EU-Digest: Britain is finally starting to pay the price for having chosen the US economic model in the days of Reagan and Thatcher. Fortunately for the EU the British are not tied to the Euro or the policies of the ECB, which so far have been far more successful than the British and American governments in containing inflationary spending . The Eurosceptics better take note of this before they criticize EU's policies. Britain needs Europe.