Here is a quote from Jonathan Portes, former chief economist to the Cabinet Office, who worked on and off in government with both the Major-lead Conservatives, and New Labour. It’s from an article in the exceedingly left wing New Statesman. It’s actually an interesting reflection on whether or not the UK really is stuffed economically or not, and is remarkably optimistic (see The Knife here). As Portes says: these are the problems of success in a rich, ageing, developed economy.
“…there are the “permanent austerians”, who argue that the deficit is so large and the fiscal forecasts so dismal that we will have to keep on cutting, not just until 2015, as per the original plan, but until 2020, as the Prime Minister has suggested. Yet recent history suggests thata proper recovery would quickly render these forecasts obsolete. In 1993-94, the budget deficit was only slightly lower than it was last year. In sharp contrast to the current administration, the then government adopted the sensible policy of not trying to cut the deficit until recovery was established. The result was strong growth and rapidly falling deficits. In four years, the deficit had been almost eliminated and only three years after that we had the largest surplus in modern times.”
Note my emphasis:
only three years after that we had the largest surplus in modern times
That is to say, when Labour got in in 1997, according to one of its own, the economy could not have been in better shape, all things considered.
Where did it all go wrong? Ed, Ed, Gordon, Peter and Tony….