First published: Prospect Magazine, 12/12/2012
George Osborne’s Autumn Statement marks the half-way stage in this parliament. It is a moment to reflect on his economic strategy and to look forward—with some trepidation, it has to be said. The strategy to breathe life into the economy, eliminate the structural part of the deficit and bring the debt to national income ratio down by the next election in 2015 has not worked. The economy remains in a mild depression, with periodic ups and downs, and the deficit target has now been “rolled out” to 2017/18. Without a shift in strategy, this state of affairs could continue for a long time, bringing the risk that unemployment will rise, and the coveted AAA sovereign credit rating will fall.
To be fair, the chancellor could not have taken office at a less favourable time. The economy……more