Rishi Sunak will sound super confident today. He will sing the praises of his budget to a very largely empty House of Commons, and will hope the media pick up his backbencher's online cheering. And underneath that calm exterior there will be, if Sunak is remotely human, an element of massive self doubt. Because the fact is that Sunak must know three things.
The first is that the Office for Budget Responsibility, which essentially prepares the budget forecasts, has massively overestimated its budget forecasts for more than a decade, which is as long as it has existed. There is no reason to think this time is any different. It's always easier to be optimistic about forecasts when you know that there is at least a chance that they will be right. There is no reason to think that will be true of the OBR forecasts today.
Second, in the very short term everything that Sunak says today depends on Covid being beaten by June. That is a wildly optimistic forecast because of the UK's vaccination policy. France is seeing a signifiant vaccination effect as a result of following the prescribed action for double vaccinating within 21 days. We are not seeing anything like that vaccine impact, but are seeing a good lockdown result. That does not mean that we will not see that second dose impact in due course. But equally we do not know that we will. If that impact does not materialise, or new variants do instead, absolutely everything about this forecast is wrong and Sunak knows he will be back at the Despatch Box sooner than he would wish.
Third, Sunak knows that his scope for manoeuvre is limited by his ‘back to normal' brigade. In particular, they want rising interest rates, lower taxes, and masses of state support for their own chosen projects. These are irreconcilable aims. Sunak must know it. Those backbencher who should be cheering might well not be, that much, as a result. It may be to Sunak's advantage that they are not present, after all. The Tory right has lost touch with reality. No Chancellor can win against that.
I suspect Sunak can weather the Tory right wing: they are running our of alternative prime ministers.
I suspect Sunak knows that all the economic forecasts can give him are some good headlines in The Mail tomorrow.
What, if he has any sense, he worries about is Covid, because people forget forecasts, but they wont forget another completely failed budget based on wholly false promises because the government got this virus wrong all over again. Of course, they may not have got things wrong. But as with Office for Budget Responsibility forecasts, the precedents are not good.
Sunak's smile will be fixed for the days to come. The inner man will need to be deluded to believe that all that he will be saying is true.
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All I can say is to remind you/us that this system that we have at the moment is one that rewards risk taking and stupidity so that people get paid well to say and do stupid things to maintain that system.
Sunak has already been bought a long time ago by this system and has benefitted from it considerable before becoming Chancellor. I don’t think he’s deluded at all. His intention is to delude us, which is even worse.
It seems they already know a fourth lock down maybe coming down the tracks at them….
Exclusive: NHS in London asked to plan for ‘possible covid surge later in 2021
https://www.hsj.co.uk/quality-and-performance/exclusive-nhs-in-london-asked-to-plan-for-possible-covid-surge-later-in-2021/7029605.article?mkt_tok=OTM2LUZSWi03MTkAAAF7lhgxh4pmVFAQLt2m1PDkdTxmJjsnzDwVXj-Plb4Mh7vVx0QF6XPtdrsuxCGYCJlJ0VaH7gJ12mDPYBp4xtBi92OyIp69BmRrYNo9bj77gIKDHg
Shouldn’t the Office for Budget Responsibility be renamed the Office for Cheerleading?
Usually of course it’s high-kicking right-wing monetary and economic nonsense which eventually results in toppling over!
I think the suggestion that Sunak (a brown man) is not fully human is disgusting and should be withdrawn.
I treated him as I would any politician
I see no difference between him and any other person
The racism is all yours
Certainly, straightforward lies play a part in all this, but it can be difficult to separate those from either self-delusion or economic illiteracy. This matters, since illiteracy can be addressed to some degree, at least in the longer term, while the other two factors are essentially political dogma. The comprehensive takeover by monetarism from the eighties onwards of the entire university economic education system means several generations of economists with little or no exposure to alternative approaches. It is hardly possible to exaggerate the effects of this and perfectly possible that Sunak himself and umpteen of his predecessors actually BELIEVE their own nonsense about the national debt. I imagine the FT does. In those cases, political dogma looms large as well, so there is little hope, but your role in exposing the bedrock of utter nonsense driving economic policy from every one of our political parties is vital and it would be helpful to know of other influential writers supporting your approach. They are not easy to find, Richard!
look at Steve Keen and Stephanie Kelton for starters