The Conservatives' real deficit problem is a lack of shame | Business | The Observer

The Conservatives' real deficit problem is a lack of shame | Business | The Observer: "Cabinet ministers evoke a wide variety of judgments, but I cannot recall anything quite so caustic as that of the celebrated journalist Bernard Levin, on the foreign secretary, Selwyn Lloyd, in 1959. In a review in the Spectator of a book about the early 19th century statesman Lord Castlereagh, Levin wrote: "The real mystery, in fact, is not why Castlereagh cut his throat, but why Mr Selwyn Lloyd has not." Not long after that, Lloyd was elevated to the chancellorship by Harold Macmillan.

My dissatisfaction with the chancellorship of George Osborne has not diminished with time, but even I should find it a little extreme to suggest that he fall on his sword. Nor do I think any longer that that great fan of Macmillan, David Cameron, should sack him. No, I think Osborne should remain in place until he faces the verdict of the electorate: a verdict that ought to be damning.

It is laughable that Osborne should, apparently, have chosen to fight the Labour party on the issue that they are not being as tough on "the deficit" as he is. For a start, he has always been obsessed with the wrong deficit. The principal macroeconomic problem facing the British economy is the size of its balance of payments deficit. The budget deficit, so far from being a problem, was from 2010 onwards part of the solution: it stopped the rot when the economy was in a nosedive in 2009. That it is still with us, albeit at a lower level, is due to the failure of Osborne's strategy, which was to eliminate the deficit within this parliament – something, mercifully, he is nowhere near to achieving."



'via Blog this'