So this was the Recession Budget surprise: a seven-year horizon with no debt repayment plan. Ha! Bet you didn’t expect that. Britain is to be transformed from a low-debt country into a nation saddled with a wartime debt without having fought a war. And as for today’s Brownie – it’s one the Stern Review used: fake juxtaposition. Brown presents the splurge (or splutter: £9.2bn this year, £16.3bn next) on one hand. And on the other, tax rises for the rich. He wants newspapers to write that one somehow cancels out the other. But it doesn’t: he has no plans to fund his extra spending. He’ll just keep borrowing. Debt will keep rising from £537bn in 2007-08 rising to £1,020 in 2012-13. Darling says it will peak then, but only as a share of GDP. It will rise to £1,080bn in 2013-14 (all excluding NR, B&B etc). Then: pow. His crystal ball runs out.
The debt will be dealt with by whoever wins the election after next. Until then, we’ll be paying more in debt interest than in defence and probably on schools and police as well. So the Tories were wrong-footed: the debt bombshell implied some degree of honesty from the Treasury, some repayment plan. The bombshell is there – but it is not due to explode until 2015/16. And until then it will be a blitz of government spending pushing families ever further into the red, year after year. This is Brown’s plan: we will knowingly saddle our children and our grandchildren with billions upon billions of debt. And as Eleanor Roosevelt said: this not just an economic failure, but a moral one.
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