The FT got it right – their budget headline is:
Osborne delivers kill or cure Budget
There’s no doubt in Larry Elliott’s mind which it is:
This budget is a colossal gamble. There was little evidence before the election that Darling’s fiscal plans – themselves draconian – were insufficient to keep the febrile financial markets sweet. The pound and gilts strengthened during the election campaign, even though the possibility of a hung parliament was ever-present. The international backdrop is less favourable now than it was two months ago, both because growth prospects are weaker and because the deficit-cutting fraternity have the upper hand in the G20. Far from being a terrible evil, government spending spared Britain from an even worse recession in 2008 and 2009, and Osborne’s doctrinaire approach to deficit cutting risks not just slower growth and higher unemployment, but a fresh leg to the downturn.
Not all the lessons of the 1980s have been learned, it seems.
Kill it is then.
5 Responses to “Kill or cure”
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Great stuff from Larry. My money’s on kill – this is an economic suicide note for UK plc.
Hey Richard, not for the Isle of Man it isn’t. Our Treasury Minister reckons the VAT increase to 20% will help the Isle of Man to the tune of £25million!
Thanks UK
xx
http://www.manxtube.com/video/1851/VAT-goes-up
Silver linings and all that.
@AlbertR
I knew someone would mention that
I feel sorry for the poor on the island
Relying on a Keynesian prescription for a post war economy is surely a much bigger gamble than dealing with the problems we face in the context of the world as it is now.
@alastair
Explain please
Why, in other words?