Fraser Nelson

Why Yanis Varoufakis is right about George Osborne’s fauxsterity

Why Yanis Varoufakis is right about George Osborne's fauxsterity
Text settings

Not often that I’d be inclined to agree with Syriza, but Yanis Varoufakis had a point last night when he questioned the degree of austerity that has happened in Britain. The Conservatives talk a good game, he said, but George Osborne’s cuts pretty much stopped after year one.

I’m going to give a compliment to George Osborne and the Tory government. It’s going to create some consternation in the Tory part. He hasn’t really practiced austerity, he has talked about austerity and it didn’t work. He killed of the nascent recovery after 2009 with the little bit of austerity he did, but he stopped it.”

The below figures, drawn from Treasury data, rather back him up. Osborne started off well, but then – just as Varoufakis said – ground to a halt. It will take him eight years to cut as much as Labour did in 1976-77, under the instructon of the IMF.

Screen Shot 2015-09-25 at 18.35.37

Ken Clarke then followed by saying “on a serious point” that “you cannot have the kind of prosperous economy that our children need unless you combine good, enterprising economic policy with well-managed public finances.

“The idea that you can somehow run up debt on the scale that all the Western democracies did – run annual deficits like all the democracies did, and borrow it ad nauseam from other countries.. would be marvelous if it worked.”

Erm, quite. The following graphs, again drawn from Treasury data, show what’s really happening to the public finances. One day, the political rhetoric might just catch up.  Screen Shot 2015-09-25 at 18.38.53

Screen Shot 2015-09-25 at 18.40.06

Written byFraser Nelson

Fraser Nelson is the editor of The Spectator. He is also a columnist with The Daily Telegraph, a member of the advisory board of the Centre for Social Justice and the Centre for Policy Studies.