GDP up – thanks to public spending

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GDP up – thanks to public spending and car scrappage | Business | The Guardian .

The Guardian reports:

Alistair Darling's insistence that the economy would still be stuck in recession without a leg-up from the Treasury was boosted today by news that public spending and the car scrappage scheme had been essential to generating a recovery in the final quarter of 2009.

While GDP growth at the end of last year was a better than expected 0.4%, according to the Office for National Statistics – up from its previous estimate of 0.3% – analysts said the detailed new figures revealed that taxpayers' support had been critical in generating the first quarter of expansion since spring 2008.

Of course that's the case.

The private sector cannot make up the slack in the economy at present. Only the state can. Which is why cuts make no sense at all and a Green New Deal does.

The reality is simple: we need more state spending now, not less. There is no other way out of this situation.