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  Jan - It is wrong to portray things as 'the world was plodding along quite happily'. The downturn happened first and downturns/recession always come along, they are inevitable. British exposure to the US was to a large part down to Brown's regulatory loosening, which in itself in the US was caused by Clinton's reform's.
  
  Forget the party politics and simply look at the deficit from the angle of common sense and logic.
  
  The economist Keynes (who is Labour's favourite economist, not mine) said that debt should be repaid in the growth phase of the cycle so you can then borrow to maintain public spending in the following downturn. Quite logical. So what happens when you do not repay debt in the growth period? You end up starting the downturn with a structural deficit and that means that you are just piling debt upon debt. That is what happened and it is vital that the deficit is eliminated before the next downturn and some of the debt repaid as well. The alternative is that you just keep on chasing your tail on an ever declining economic spiral.

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