James Moore, The independent
The headline grabbing part of the Institute for Fiscal Studies’ annual audit of Britain’s public finances is that Boris Johnson’s beloved no-deal Brexit will push the government’s annual borrowing bill to a 50-year-high.
After a decade of austerity, the party that held up “sound public finances” as the holy grail, has torched it in favour of a borrowing boom the likes of which most of us are too young to have experienced.
But that’s not even the report’s killer line. Whether you’ll see it depends very much on where you get your news because it says that the Tories’ current plans are for day-to-day spending on public services to bring us close to the levels implied by Labour’s 2017 manifesto.
You remember, the one we were told was an ultra-left-wing spend-a-thon straight out of the seventies that would bankrupt Britain within a matter of months and have chancellor John McDonnell knocking at the doors of the IMF like Dennis Healey did in 1976.
McDonnell, alive to what Labour was going to face, sought in that manifesto to spell out how he would pay for the government’s largesse, largely through increasing taxes on wealthy people and corporations.
These were expected to raise about £50bn. Labour’s extra spending commitments racked up to £75bn, with the gap funded by extra borrowing which the party said was justified by the investment it was going to make. It should be said that the IFS at the time suggested there was still a rather large black hole at the centre of the plans. But at least McDonnell made a stab at fiscal responsibility.
Johnson’s just laughing at it. In addition to his proposed spending boom, he says he’s going to cut taxes for the wealthiest too. That’s about the only thing that you might see as truly conservative about what he and Dominic Cummings are now planning.
And yet the Tory commentariat that blasted McDonnell as a spendthrift commie (still does if we’re honest) hails everything that vents forth from the incredible sulk in No 10. It is indeed a funny old world.
Yes, I know Sajid Javid is nominally chancellor but his sole job is to go out and try and sell what his mafiosi bosses have cooked up. He appears to have about as much influence over policy formation as I do over the quirks in Microsoft’s next operating system.
Poor man. He’s going to have to try and keep a straight face while explaining to the serious people that chancellors have to speak to why the IFS says the government is operating with “no effective fiscal rules”. And he’ll have to explain to the electorate what the austerity policy he once backed was all about now he’s proposing to borrow more than Labour ever dared to suggest.
All this is going to happen while his boss prepares to throw us into an economic pit courtesy of the no-deal Brexit chimera.
Since the EU referendum we have lost up to £66bn, while private sector investment is as much as 20 per cent lower than it otherwise would have been. As the CBI has recently stated, the predictions of a bad outcome emerging from a “Leave vote” have been realised.
But this is just the start of it. A deal won’t improve things. It will simply serve to keep us in the slow lane. No deal will serve to make a bad situation very much worse. If Johnson manages to secure and win an election, it will crash us all into a dark reality.
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