Diane Abbott, heavyweight economic commentator, is part of the Guardian's panel commentating on the mini budget.
The full stupidity and dishonesty here.
It would be completely unfair to blame all the problems of the British economy on the chancellor, Rachel Reeves. But it is reasonable to question whether her policies will lead to any significant improvement in those problems. The answer is a resounding no.
The spring forecast provided nothing in terms of government initiative to improve the economy. Having been badly burned by implementing austerity in all her previous fiscal events, some of it drafted by the Tories but not implemented by them, the chancellor clearly decided discretion was the better form of valour.
Given the poor forecasting record of the Office for Budget Responsibility (which relies on the UK Treasury model of the economy), another chancellor might not have relied so much on its projections of marginally better times ahead in future years. But people clutch at straws, when there is nothing else to cling to.
Insisting that the economic plan is working while relying on forecasts of marginal increases in GDP per head, as the chancellor did, suggests at least a lack of presentational skills, if not being completely out of touch. There is no need to tell voters they will be better off if it really is going to happen. They will feel it in their real pay, in improving public services and in a lower cost of living. But the Treasury is littered with the nameplates of Tory chancellors of recent years who promised improvement and failed to deliver it.
The chancellor seems as flummoxed as her Tory predecessors when the private sector fails to deliver growth. Promising them deregulation to lift their “animal spirits” is precisely a reiteration of failed Thatcherite nostrums of the past that Reeves bemoans.
The clear path out of the crisis should be a significant increase in public sector investment, which could address the serious failings: a housing shortage, woefully inadequate infrastructure, communications and transport. Public investment would kickstart the recovery, address significant problems and be easily affordable at current real interest rates.
Instead, the chancellor and prime minister seem in thrall to the private sector, which continues to underinvest. Their only exception to this is increasing military spending, which Reeves boasts is the biggest rise since the cold war ended.
Some of us remember when there was a peace dividend then. There cannot be a war dividend now. In fact, military spending is one of the most wasteful areas of all. But in uncertain times, the chancellor’s choice appears to be: let us add to uncertainty.
I don't think she even knows what borrowing costs are. Has she checked since 2013? Nor what "austerity" is- clue, it's not spending on some things going down, while others go up by a lot. Nor what the Spring Statement actually is- another clue, it's not The Budget, there's a clue in the name. She's also got no idea what's actually being deregulated, she doesn't just like the sound of it. Deregulation on housebuilding and infrastructure planning does offer the chance to improve the economy. It would make the public investment she wants better value too.
And how fast does she think GDP per capital should go up? It's gone up pretty well since she's been chancellor. The reason people don't feel worse off is paying more tax.
The complete dismissal of the private sector is extreme even for the left. It rivals the bullshit about Defence spending as the most silly bit, which says something. Actually perhaps the bit about the OBR is the worst- what predictions do you suggest she relies upon, Diane? And have you heard of "headroom"?
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- By The Weeping Angel
- By davidjay