I argued the other day that “there is an alterative” to cuts.

It’s good to see Martin Wolf strongly endorsing Ed Balls for saying so. As Wolf said:

The “Treasury View” of the 1930s is back. If the government could not borrow, there would indeed be no alternative. But it does; so there is. Mr Balls is quite right to say so. He is right, too, to warn of the risks. The economic ”hurricane” he foretells might arrive rather soon.

Balls argued:

two fundamental points: first, time and again, conventional wisdom on macroeconomic policy has proved misguided; and, second, the propositions advanced by the chancellor are wrong: Those are that Labour is entirely responsible for the current mess; that the demand for fiscal consolidation from the markets is overwhelming; that the plan for a deficit reduction will generate sustainable growth; and that those who disagree are “deficit deniers” who would wreck recovery.

Wolf said Balls is right.

I agree.

The Treasury View was wrong in the 1930s.

It is wrong now.

We can, must and as a matter of fact will borrow to pay for the properly directed growth that is the only way out of our current malaise.

The idea that Ed Balls has to be shadow chancellor whichever Miliband wins (and I have a clear preference) is becoming stronger by the day.

He may be chancellor for real sooner than we expect if the hurricane hits.