Psychology of nations and the CSR

Before the economic crisis Britain's level of national debt was one of
the lowest of the top nations in the world. The UK is heavily dependent
on the financial markets and the debt situation became a lot worse after
the bailout but it still has the capability to take on more national
debt to get through the recession. It handled a significantly higher
level of national debt in the mid-20th century.

The government is afraid though. It fears taking the country into more
debt. The fear isn't totally irrational but it's beyond economics. In my
opinion the fear that drives the unwillingness of the government to
borrow to spend out of the recession is based in psychology. It's based
upon seeing a country like Iceland go bankrupt and Greece be threatened
with something similar.

The fear of national bankruptcy is not irrational but it may be an
anxiety. Britain is far different to Iceland or Greece. It has many
assets it hasn't cashed in, for example the North Sea oil fields. It is
depend on the fiscal markets because it is a world leader in the fiscal
markets. But the problems of the other nations have created an anxiety
such that the politicians are over anxious about taking on the debt
required to start a job creation programme. This has historically been
the way to get a nation out of a serious economic depression.

At least a million people will lose their jobs and enter a job market
where there aren't many jobs to take. This loss of productivity is
fundamentally what a recession is about rather than all the negative
pound signs seen in reports. The political anxiety over bankruptcy means
the government aren't thinking straight. The nation needs to stay
productive to survive. This will be the only way the UK will survive and
thrive through the recession period/