Ever since austerity programmes began they have been justified by a number of rather bizarre economic arguments.
The first of these was that government borrowing would squeeze out private investment. There is no evidence that this is happened. Instead, it appears that big business is choosing to sit on enormous piles of cash which he could invest, but chooses not to use.
The second was that as government borrowing increased so would the interest charges that had be paid on it, so increasing the cost of debt to the point where the government would collapse under the burden of its debt obligations. In 2010 George Osborne was all too anxious to draw comparison between the UK's situation and that of Greece. This too has now been proved to be ludicrous despite the fact that the coalition government has now borrowed more since coming to office than the last Labour government did in 13 years on office. As the FT said yesterday:
Ten-year yields on core government bonds, which move inversely with prices, have edged lower in 2014 – defying a near-universal start-of-the-year consensus that the only way was up.
This, incidentally, is true across a number of major countries, and not just the UK. The fact in that case is that there has been no crisis of confidence. Instead people are actively seeking to buy government debt.
In that case the question to be asked is why we are not exploiting this now to raise the funds to invest in the way this country so desperately needs? It's economically absurd not to do so.