George Osborne’s decisions are coming back to haunt him

Commenting on George Osborne’s planned spending cuts, Liberal Democrat Treasury Spokesperson Susan Kramer has said:

George Osborne set himself the task of abolishing total borrowing in order to try and look tough on the economy as part of a bid to become Prime Minister. Now his decisions are coming back to haunt him, but it will be the public who suffer.

Rather than slashing investment and public services to hit an arbitrary spending target, now is the time for him to come clean, admit he was wrong and start the kind of capital spending we need in housing and infrastructure to make our economy fit for the future.

* Paul Walter is a Liberal Democrat activist. He is one of the Liberal Democrat Voice team. He blogs at Liberal Burblings.

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16 Comments

  • Tsar Nicholas 27th Feb '16 - 4:34pm

    It would not surprise me at all if some voters opted to leave the EU in order to give Osborne and his mates a good kicking over his further spending cuts, the ones he just announced to the BBC.

  • nigel hunter 27th Feb '16 - 9:19pm

    He says things are bad and we must still have austerity. I would not be surprised that ‘low and behold’ say April, we suddenly are on the up and we can invest in projects for vote catching purposes.

  • In May 2013 the Independent published this from a wide collection of Economists/Journalists….”

    “..The overall picture is of a pre-recession Labour government whose borrowing and spending were sustainable and a post-recession Labour government that made more or less the right moves to stave off an even more calamitous downturn.

    This is not to say that Gordon Brown et al got everything right. The Labour government presided over an era of irresponsibility in UK banking. However, the numbers show that their approach to spending and borrowing was actually sound. The irony is that Labour gets a lot of criticism for a crime of which they are innocent (spending too much) and hardly any at all for one of which they are guilty (not regulating the banks).

    Reckless government borrowing and spending can indeed pitch countries into an economic crisis. But to co-opt this narrative to explain the UK’s current situation is economically illiterate. The striking figures on leverage in the UK banking system show that the ones taking historically unprecedented risks with their finances were not politicians, but banking chiefs.

    Excessive government borrowing did not get us into this mess. Falsely believing that it does covers all manners of sins when it comes to government spending cuts. Understanding the real causes behind the recession frees our political conversation. No longer should we be arguing about how deep the cuts should be, but whether we should be cutting at all.

    Borrowing more and spending more are not the kamikaze strategies the Government would have us think. More government borrowing and spending now won’t make things worse. In fact, the numbers suggest, there’s a good chance it’s the only thing likely to make things any better…..”

    If our leaders in coalition had not joined the Tory chorus of “Austerity is the only answer and It’s all Labour’s fault”, perhaps we might not be where we are..

  • Simon Shaw 28th Feb ’16 – 10:57am…………[email protected]
    “Excessive government borrowing did not get us into this mess.”………….Quite right. It is excessive government borrowing that is the consequence of the financial mess we got into, not the other way round………………..When you say that we shouldn’t have said that “It’s all Labour’s fault” (not that I’m aware that we did), are you implying that none of it was Labour’s fault? The reason I ask is that seems to have been Labour’s line at the last GE and it didn’t seem to convince the electorate……….

    Clegg/Alexander constantly used the “It’s all Labour’s fault”…As recently as our October 2014 conference he said of Milliband, “This is a man who was part of the government which wasted their chance and ruined the economy, destroying jobs and slashing incomes” and, when Milliband asked for Clegg’s support in limiting ‘bankers’ bonuses’, Clegg’s reply was that “He’d take no advice from the leader of a party who had “SINGLE HANDEDLY” ruined the economy”…

    As for your “Are you implying that none of it was Labour’s fault?”…Did you miss the paragraph that said “Labour gets a lot of criticism for a crime of which they are innocent (spending too much) and hardly any at all for one of which they are guilty (not regulating the banks).”?

  • Osborne used the crisis to push a cranky right wing economic agenda and that’s the path he will continue down. Not only that his economic policy seems to be based on low wages, Ponzi scheme property prices and blaming the fall out on the disadvantaged and immigrants. If he’s coming unstuck it’s because he is economic with the actuality.

    I also suspect he is issuing dire warnings to strengthen the government’s hand in the EU vote.

  • “The reason I ask is that seems to have been Labour’s line at the last GE and it didn’t seem to convince the electorate.”

    Whereas the Lib Dem line* totally convinced everyone at the last GE.

    Not supporting Labour here you understand, but by God that is the worst argument you possibly could have come up with.

    *David says it’s all Labours’ fault, so we agree…

  • “The reason I ask is that seems to have been Labour’s line at the last GE and it didn’t seem to convince the electorate.”

    What the electorate believe and what is (to the best of our statistical knowledge) fact aren’t necessarily the same thing: in 2013 The Royal Statistical Society and King’s College London produced survey results which showed just how repeatedly wide of the mark the public are.

  • Personally, I think Labour’s big mistake was propping the banks up and the too big to fail shtick. Iceland refused to do any of that and recovered no slower than anywhere else, plus threw some crooks into jail. Any fiscal stimulus should have been used like Roosevelt in the 30s or even Nixon did in the early 70s – much to the chagrin of Milton Friedman. The problem is that since the mid 1970s small government dogma has become the orthodoxy and governments are more scared of pressure groups than the electorate.

  • Simon Shaw,
    I write, “Labour gets a lot of criticism for a crime of which they are innocent (spending too much) and hardly any at all for one of which they are guilty (not regulating the banks).”?”

    Which, by any sane interpretation, reads as, “By not regulating the banks Labour are guilty of allowing the banks to create the financial crisis”..
    Which you read as “I take it that means you genuinely are saying that you think that NONE of it was Labour’s fault.”

    Now that IS bizarre!

  • Of course it’s all Labour’s fault , and you should acknowledge that Expats :

    The truth is that Mr Lehman Brothers (originally from New York) was the Corbynista left wing Labour M.P. for the Angel Islington when that neo-liberal arch conservative George W. Bush was Prime Minister in 2008. And didn’t Bush the Younger’s massive tax cut in January 2008 have more than a tad to do with it as well ?

    It’s also self evident that Miss Merrill Lynch and Mr AIG (brother of the Stig) were also secret backers of the Labour Party ? The other thing I heard some time ago (I think it was in Southport) was that a Councillor Miss Fannie Mae and a Councillor Freddie Mac were both left wing Labour members of Liverpool City Council.

    No reds under my bed, matey, no fear of that.

  • David Raw, I’m sorry. I hadn’t looked into the US connection with Labour… Obviously, the clue is in the nation with a national hymn putting ‘Red’ first and ‘Blue’ last (“Hooray for the, etc.”)…..

    Simon Shaw.. Earlier I broke a personal promise not to respond to your pedantry.. Hopefully, I won’t make the same mistake again…

  • Lorenzo Cherin 1st Mar '16 - 2:18pm

    David Raw

    With your commentary and the rather mug shot matinee idol picture, above, of Osborne, maybe it is the role of the new James Bond he is going for !Boris Johnson as Q , Teresa May as M and of course Corbin, the Bond villain ! Oh , for sure,as with Lenin or Stalin, or indeed Putin,the secret is out , his name is Russian, never mind reds under the beds !

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