Do watch Brown’s speech to Imperial College earlier, in which he defends the Govenrment’s plan to increase public debt in order to spend, spend, spend our way out of recession (or at least that’s the theory). It’s our PM doing what he does best – deviously shifting the economic narrative to suit his agenda – and doing it with great aplomb. No longer is government debt something to be swept under the fiscal carpet in a series of dodgy off-balance sheet manoeuvres. Rather, it’s something to be proud of: a badge of “responsibility” in these depressed times.
Brown’s certainly an advocate of the Keynesian economics underpinning all these claims. But I’m sure there’s another motivating factor behind them: namely, cutting off lines of attack from the Tories. Just as he subverted the tax’n’spend argument into one of ‘Tory cuts vs Labour investment’, so too is he trying to subvert the current narrative into one of “responsible borrowing vs irresponsible spendthriftery”.
Phase II of this plan will be implemented later this week – with Alistair Darling set to announce that the fiscal rules will be relaxed to allow for more borrowing – making it even more crucial for the opposition parties that they register their objections to it hard and fast. Otherwise, the Brown narrative could take root in the public consciousness – and all to the detriment of future taxpayers.
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