*The most powerful form of lie is the omission – George Orwell

Debt poses a serious problem in most developed countries, and in many developing ones. But statistical omission and obfuscation hide the true problem. Rapidly rising numbers of old age dependants plus unfunded pay-as-you-go social security schemes are already causing unrest. More is likely to follow as state backed promises of medical and old age support become impossible to fulfil.

The problem is far greater than official debt figures suggest. Government debt data in most countries massively understates the real situation. Almost all commentary on country debt is focussed on official Government country debt as a percentage of GDP. But this number represents only a fraction of real country indebtedness. More than 20 years ago the problem was illustrated vividly by Kotlikoff and Burns, in a book presciently called The Clash of Generations:

*"Virtually all of Uncle Sam's IOU's are off the books. They are unofficial, informal, implicit, hidden away in odd places like alcoholic's bottles. But call them what you will, paying 78 million baby boomers their Social security, Medicare and Medicaid benefits is a very real obligation."