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Thursday, 17 September 2009

Toynbee on Tory spending plans

I really agree with Polly Toynbee that making spending cuts too quickly could choke off any possible recovery.

"The tax-and-spend battle began in earnest this week. But with every speech, Osborne and Cameron offer nastier medicine, sharper knives and worse to come"
and they love it too. Their core vote loves it too.

"With encouraging indicators this week that Britain is starting to emerge from recession a little ahead of Treasury forecasts, early signs suggest public opinion is shifting to the view that Labour's fiscal stimulus worked. Recovery will be fragile all next year, with fear of a double dip. So where are the Tories? Thoroughly trounced, proven to be wrong when all through the crisis they alone in the world opposed all intervention, including the bailing-out of banks. They have virtually no reputable economic allies."
That's interesting from a 'wonk' point of view, but will it matter to voters? I hope so, just because if someone sorts the economy out and then is replaced by someone who opposed the measures that worked, that sounds stupid.

According to Toynbee, economists (who may or may not know anything about economics) are not supportive of the Tory plans:
"Economists Anatole Kaletsky of the Times and Martin Wolf of the Financial Times, both conservatives, this week walloped the Tory fixation with rapid and savage paying down of debt. Mervyn King, no Labour friend, has been the great promoter of quantitative easing. Robert Chote of the IFS warns Britain may already be planning to withdraw fiscal stimulus too soon. Every country, except Argentina, intends to keep spending through 2010, despite equally high debts. Nonetheless, at the spring election, just as recovery is fluttering to life, the Conservatives' one great priority will be to put it all at risk with immediate deep cuts, unprecedented anywhere else."
I was never a fan of Martin Wolf coz i always saw him as being dogmatic and hard-headed in being a big ol' righty on economics. Meaning that if someone like THAT is criticising the Tory plans, then the Tories are probably wrong. If someone who has made a career advocating one type of economics turns round and proposes something else, then they may have a point. I, for example, don't tend to agree with Martin Wolf, so if he's now seen the light and agrees i'm right that can only mean he's correct

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