Gamblin’ man

When George Osborne visited Sweden, Finland and Denmark  the stock markets of each country promptly fell by about 5 per cent. As soon as he left, they recovered. A coincidence, of course: Osborne’s tour coincided with stock-market jitters, but this nonetheless forced him to look over the precipice — and panic. Britain, he warned, was ‘not immune to what goes on in the world’. Not for the first time, we saw his lips moving but heard Gordon Brown’s voice. ‘We are much better prepared than we would have been a few years ago for this kind of shock,’ he added.

If only this were true. As the Chancellor knows, we are far more vulnerable than we were last time. In 2008, the national debt was 37 per cent of GDP — a fairly low level, inherited from the Tories, that allowed Labour to borrow its way out of the crisis. Now, the national debt stands at 80 per cent of GDP and we have no more room for manoeuvre. While lecturing everyone about austerity, Osborne has swollen the national debt to some £1.5 trillion and has not finished yet.

This is not QE-style imaginary money but real debt that has to be repaid by real British taxpayers, working out at about £56,000 per household.

To be sure, Osborne inherited public finances that were out of control — but he has been in no rush to correct things. At first, he said he’d balance the books in five years’ time. He has now given himself ten years because of a freakish blip in world markets. Interest rates everywhere were coming crashing down, so for all of his hair-shirt rhetoric, he could keep running up debt and get away with it.