Sunak should be modelling his fiscal rules on Clem Attlee’s, not Margaret Thatcher’s

Normally, reading economic statistics is, for almost everybody, a sure-fire way of curing insomnia. Not anymore. The Office for National Statistics came out with yet another attention-grabber last week. Government debt in the UK, the august body pronounced, is now bigger than GDP for the first time in over 60 years. The statisticians did qualify […]

It’s time to go back to basics and go about fixing our deficit before more tax cuts

As inflation pushes prices further and further up, food has been getting more expensive for some time. But, as the cliche goes, there was never such a thing as a free lunch. This idea, well known among economists, means prosperity depends upon making the effort to raise productivity. These are concepts which Western electorates are […]

A windfall tax raised by a money-hungry government will scare off our businesses

Rishi Sunak’s windfall tax on energy firms – what he called a “temporary targeted profits levy” – has gone down well with voters. The tax makes it look like money is raised from someone else and given to them through subsidies to their bills. Despite claims that the tax will yield an additional £5bn in […]

Longer lockdown based on hypotheticals would come with serious economic costs

The penny is finally beginning to drop. The health service’s focus on giving absolute priority to the treatment of Covid-19 generates costs and problems on a massive scale. Chris Hopson, chief executive of NHS Providers, has warned of the huge pressures on the NHS from the backlog of non-Covid cases. Many of these are life-threatening […]

Britain is more optimistic about Brexit than gloomy forecasts suggest

British Weather

The International Monetary Fund (IMF) is up to its usual tricks. Last week, it predicted a two-year recession in the UK in the event of a no-deal Brexit. Even in the main forecast, involving a mild Brexit, GDP was projected to grow by only 1.2 per cent this year and 1.4 per cent in 2020. […]

Cautious corporates sitting on hoards of cash are to blame for our slow recovery

London construction

The slow recovery since the financial crisis remains a dominant issue in both political and economic debate. The economy has definitely revived since 2009, the depth of the recession, in both Britain and America. The average annual growth in real GDP has been very similar, at 2.0 and 2.1 per cent respectively. This is much […]

What Dirty Harry tells us about economic forecasters’ Michael Fish moment

Economic forecasters are in the dock. Last week, none other than the chief economist of the Bank of England, Andy Haldane, was confessing the crimes of the profession. The failure to predict the financial crisis was, Haldane said, economic forecasting’s “Michael Fish” moment. Thirty years ago, the BBC weatherman predicted that the UK would avoid […]

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