When In Rome Don't Do As the Romans Do

A grave economic situation appears to be looming. Despite the government's attempt to get the economy growing by spending billions of pounds on recapitalising the banks there are few signs that an upturn is imminent. As the countries public finances continue to deteriorate amidst news that the number of people unemployed is heading towards the 2 million mark, prospects for the immediate future look bleak. Under the circumstances the governments plan to get the banks lending again, thus kick-starting the economy, looks doomed to failure. On the one hand the banks are going to be very nervous about lending to business, whilst everyday we hear that more companies are going into administration. On the other hand they are going to be very reluctant to increase personal lending at a time when the people they are lending to look increasingly likely to lose their jobs. Add to this the fact that any further rises in unemployment means more lost revenue to the government by way of tax and insurance and at the same time the government have to pay out more money by way of unemployment pay and soaring benefits. The government's VAT receipts have already fallen by the 2.5% rate reduction and worsening unemployment will restrict spending which will reduce these receipts even further.
We are now facing the worst recession since the second world war and have now moved into uncharted territory which means that no one knows where, when or how it will all end. The fall of the Roman empire was brought about by over indulgence in eating , drinking and debauchery and their belief that the good times would never end. Not dissimilar to modern day Britain!