Tag Archives: trickle down economics

Jack Meredith

Labour’s Embrace of Trickle Down Economics: An Open Goal for Lib Dem Opposition

By Jack Meredith | Thu 17th July 2025 - 9:45 am

A few “political open goals” have been facing the Lib Dems recently, from the firing of Christine Jardine from the front bench (covered wonderfully by Lib Dem Voice’s own Mathew Hulbert) to Unite the Union suspending Angela Rayner over Labour’s lack of open support for striking bin workers.

We can now add another open goal to the list: Labour’s embrace of “trickle-down economics”.

As reported by The Guardian, Rachel Reeves plans to scrap regulations introduced by Gordon Brown, Keir Starmer’s predecessor, to mitigate the impact of the 2008 financial crash on households. Chaitanya Kumar of the New Economics Foundation has criticised the move, calling the situation Groundhog Day, questioning the decision to expect the financial sector to do “most of the heavy lifting in terms of growth”.

We’ve seen how Prime Ministers have fared with trickle-down economics in recent times, with former Prime Minister Liz Truss being removed from office after less than 50 days in power for introducing a budget that sought to scrap banker bonuses, abolish the top rate of income tax, and reverse any increase on corporation tax.

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Mary Reid

Does trickle down economics actually work?

By Mary Reid | Fri 23rd September 2022 - 11:28 am

I will start by stating loud and clear that my understanding of economics is at a very basic level. However the concept of trickle down economics is refreshingly simple, so even I get the gist. But does it work?

Ed Davey addressed the question in his interview on Sky News yesterday, where he says that the practice of boosting big business with tax cuts will not help the 4 million SMEs:

And neither will it help those many millions of people who are struggling now, at this very moment, with the cost of living crisis. Even if Truss’s proposals did manage to kickstart the economy again it would take months, if not years, to impact on ordinary citizens/consumers.

However the evidence appears to be that, even in the long term, trickle down (or supply side) economics doesn’t achieve its intentions.

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Posted in Op-eds | Also tagged and | 24 Comments
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