Leading City journalist Anthony Hilton has said the government needs to "move on from tough talk about cuts", and concentrate on restoring economic growth.
Leading City journalist Anthony Hilton has said the government needs to “move on from tough talk about cuts”, and concentrate on restoring economic growth. Writing in tonight’s Standard, he counters the debt hysteria of George Osborne and co, he points out that “every generation of taxpayers has had to pay the bills of its predecessors”, says the chancellor’s rigid stance “could prove counter-productive” and calls for a “Plan B” for the economy.
“Listen to Chancellor George Osborne and you could easily believe government debt was invented by Gordon Brown.
“In fact, he made a pretty big reduction in the debt levels he inherited from his Conservative predecessor John Major – fixing the roof while the sun was shining, to coin a phrase – until he was knocked hopelessly off course by the financial crisis and the need to bail out banks.
“There are many things to criticise Brown over but debt management before the crisis is not really one of them. It does rather underline the pettiness behind the refusal of Osborne and David Cameron to put Brown forward as a potential head of the International Monetary Fund.
“But that’s another story.”
Looking further back, he writes:
“Even today, though Napoleon has been taken care of, the Kaiser hasn’t. Today’s taxpayers may neither know nor care but a small slice of what they hand over to Her Majesty’s Revenue and Customs every year goes to pay the interest on a couple of billion pounds of debt run up to pay for the First World War and still outstanding.
“Have a look some time at the Government securities section on a stock market prices page and locate War Loan. Launched in 1916 it is still going strong. And it is you who is paying the interest. We did rather better with the Second World War. The last of the millions lent by the US was paid off in 2006.”
And on growth, he writes:
“Nor will debt necessarily stifle economic growth. Throughout the Victorian age, hailed as the golden age of British power economically, militarily and politically, debt did not drop below 100 per cent of GDP until just before the First World War when, of course, it immediately shot back up again.
“It would be wrong to say debt does not matter but we need a sense of proportion – and having made the point, the Government must move on.”
Though Hilton is spot on regarding the government’s attitude to debt, they’re not completely anti-debt – they just believe in privatising it.Like this article? Sign up to Left Foot Forward's weekday email for the latest progressive news and comment - and support campaigning journalism by making a donation today.