Eurozone debt reaches €9.86 trillion - and interest payments now total €6.4 trillion since 1995

Eurostat has just released the figures for Government Debt and Interest payments for 2018. I've downloaded all the tables, which come in three different data formats - Millions of Euros, Millions of National Currency Units, or as a Percentage of GDP.

The headline figures are that debt in the Eurozone has now reached €9.86 trillion - getting close to the magic figure of €10 trillion. It's an increase of 1% relative to 2017, which shows that, overall, governments are trying to keep within budget.

However, it's still very important to realize that even with the relatively low levels of interest currently being charged, this still means that huge amounts of money are being paid by taxpayers to cover those interest charges.

Specifically, Eurozone taxpayers collectively forked out €213.2 billion in interest charges, bringing the total amount of interest paid since 1995, when the Eurostat figures start,  to an eye-watering €6.4 trillion.

I find it very instructive to compare this amount to the total increase in Eurozone Government debt over the same period. That increase amounts to €5.79 trillion, meaning that ALL of the increase in debt can be explained by the payments of these interest charges. Indeed, the amount of interest paid over the period is actually 10% more than the increase in debt.

Those of you who have been following my blog over the last several years will know that these interest payments are totally unjustifiable. Banks have been lending our governments money that they can create out of thin air. They can then sell on those government bonds to other parties including Pension funds in the US and Canada, who can then get paid by Eurozone taxpayers for doing absolutely nothing. 

The insanity of this is made even more obvious when you realize that the European Central Bank has itself created €2.57 trillion out of thin air that was essentially used to boost the financial markets. That money could have been used to cancel out Eurozone government debt. It would have meant that, instead of oweing nearly €10 trillion, and paying €213 billion in interest every year, our governments would only owe €7.5 trillion, and this would have reduced the drain on taxpayers by around 25%. Keep doing the same thing for a few more years, and the European Central Bank could have eliminated Government debt in the Eurozone.

I've uploaded all the tables I used to a Google Sheet that you can find here.