"... High levels of public debt are not unknown in the industrial countries. In the wake of the Second World War, for example, public debt reached about 120% of GDP in the United States and 275% of GDP in the United Kingdom. In those two countries, where levels of public debt are projected to reach upwards of 90% of GDP in 2011, the recent rate of increase parallels only that seen during the two world wars (Graph V.2, left-hand panel). What is worse, the current, crisis-related surge took place against the backdrop of a long-term erosion of
the fiscal position in many countries. Indeed, from the 1970s to 2007, the collective average public debt ratio in industrial countries had steadily ratcheted up from 40% to 76% (Graph V.2, right-hand panel). The chronic
mismatch between revenues and committed expenditures (particularly agerelated spending) indicates that, to varying degrees by country, the fiscal situation was already on an unsustainable path before the beginning of the recent financial crisis.
By the end of 2011, public debt/GDP ratios in industrial countries are projected to be on average about 30 percentage points higher than in 2007 – a rise of about two fifths. But the increase for countries that have been hit particularly hard by the crisis will be even greater: for the period from the end of 2007 to the end of 2011, the debt/GDP ratio is expected to rise by more than half in the United States and by four fifths in Spain and to almost double in the United Kingdom and triple in Ireland (Table V.1). The recent increase in public debt is unlikely to be halted any time soon, for a number of reasons..."
BIS Annual Report 2010, p. 62