Budget 2011: A case of tunnel vision

Article

The key lesson from today's budget announcement is that the Chancellor's stubbornness is not confined to his approach to deficit reduction: it also extends to his refusal to countenance an industrial strategy.

Just as there will be no 'Plan B' for the deficit, there will not be even a 'Plan A' for supply-side economic policy. The Chancellor is hoping that cuts in public spending, cuts in corporation tax and cuts in regulation will be sufficient to generate strong growth in private sector job creation. History suggests he is wrong. Without a different approach, the result is likely to be economic growth that disappoints over the next few years and sustained high levels of unemployment.

Related items

  1. A close-up photo of a house flying an England flag from an upstairs window

    Reclaiming Britain: The nation against ethno-nationalism

    How can progressives respond to the increasing ethnonationalist narratives of the political right?
  2. Street scene in financial district, London

    Rule of the market: How to lower UK borrowing costs

    The UK is paying a premium on its borrowing costs that ‘economic fundamentals’, such as the sustainability of its public finances, cannot fully explain. 
  3. A mother and child from behind looking out of a window

    Restoring security: Understanding the effects of removing the two-child limit across the UK

    The government’s decision to lift the two-child limit marks one of the most significant changes to the social security system in a decade.