Money

A round of tax cuts? A splurge of infrastructure spending? Or perhaps a whizzy way of subsidising housing? Boris Johnson could even decide to forgive student debts, and hand out a massive Christmas bonus for pensioners, craftily dressed up as a cost-of-living rebate.  There are no doubt lots of such ideas being kicked around in Downing Street today to relaunch the Johnson premiership and save Boris’s skin after a huge rebellion by Tory backbenchers. But here’s the problem for the PM: the economy is about to turn toxic. The dismal reality is that Boris isn’t going to be able to spend his way out of this scrape. But here’s the problem for the PM:

Occasionally I despair of my own profession. Even economists should be able to enjoy a long weekend. Yet some of us are stuck debunking commentary on the economic impact of the Queen’s Platinum Jubilee celebrations – much of which justifies the old tag of the ‘dismal science’. The long Jubilee weekend will indeed mean that economic activity, as usually assessed, is lower than it would otherwise have been. The output and income lost due to the temporary shutdown of most businesses will only partially be offset by increased spending in other areas, or recouped later. We have, of course, been here before. The monthly measure of UK gross domestic product

Last week, I came across a figure so staggering that I was convinced it was wrong: 5.3 million Brits (almost the population of Scotland) are on out-of-work benefits. How could this be, with ministers so regularly boasting that unemployment stands at a 40-year low? How could it be, when a national shortage of workers has been declared – and the aviation industry has been begging the government to relax immigration rules, saying that we’re out of workers? I’ve spent this week looking into it, with the help of my brilliant colleagues in The Spectator data team, and look at this in my Daily Telegraph column today. What is an “out-of-work”

I sincerely hope you’re not reading this on a holiday flight that’s sitting on the tarmac with no indication as to when it might take off – or a sad train home after your flight was suddenly cancelled. Brace for three-hour delays at security, we’re told; don’t even try checking bags in, and at worst, as happened to Tui passengers at Manchester who thought they were going to Kos, watch out for a text after you’ve boarded telling you you’re going nowhere at all. How and why? When the pandemic set in, airlines and airports – thinking, not unreasonably, that their industry was doomed – made mass redundancies rather than

When Putin’s tanks rolled into Ukraine on 24 February there was a conceit that this might be the first war which the West could fight – and win – by sanctions alone. The EU’s latest efforts to stop importing Russian oil show just what a folly this was. Donations of military equipment to Ukraine are certainly helping to keep Russian forces at bay, but economic sanctions? That is another story. Europe’s dependence on Russian oil and gas is the product of years of ill-conceived energy policy Sanctions may be helping to lower living standards among Russian citizens, but they are still a long, long way from cutting off the lifeblood

It seems no-one has a good word to say about capitalism these days. For now, even the Financial Times – that bible of our captains of industry – seems to have gone off the filthy rich. Once, the newspaper’s ‘How To Spend It’ supplement was an unashamed paean to conspicuous consumption; a veritable smorgasbord of plutocratic excess. The FT itself still describes it in near-orgastic terms, writing that the 28 year-old pull-out is ‘the benchmark for luxury lifestyle magazines’ with an ‘affluent readership’ of whom one in five ‘has or would consider using the service of a private jet’. But it seems such tributes to the tastes of the rich

There are two ways to see Rishi Sunak’s rescue package. One is an obviously needed and politically unavoidable boost to the economy and a relief for the cost-of-living crisis. The other is worrying jump towards the tax and spend policies that he once promised to avoid – and a sobering note for those who expected anything different from him. James Forsyth is inclined to the former, Kate Andrews and I are inclined to the latter. We all discuss in today’s Coffee House Shots podcast. There are many ways a Tory government could have helped households this week. Fuel costs are soaring but about 25 per cent of all electricity bills are

A £400 rebate on electricity bills. A cash handout to the poorest households. And a windfall tax on the energy companies that generate the power to keep the lights switched on to try and pay for it all. Chancellor Rishi Sunak was back to doing what he likes to do best today: handing out vast quantities of free money, while making the UK a less and less attractive place for businesses to operate. It was billed as a fix for the ‘cost of living’ crisis. Yet very soon it will become clear it was nothing of the sort. After all, you can’t tax your way out of inflation; taking the approach

Prices are rising at the fastest pace for 40 years. Real wages are falling rapidly. The cost of servicing the government’s vast debts is escalating, and companies are struggling to keep up with the rising price of raw materials. Still, not to worry. Fortunately, a quarter of a century ago Gordon Brown wisely decided to hand over management of inflation to a supremely competent group of expert technocrats, so that we could have stable prices and steady growth forever – or indeed an ‘end to boom’n’bust’ as Brown would have inevitably put it. Oh, but hold on. It turns out it is not quite going to plan. In fact, while

Some £500 billion was printed by the Bank of England during the pandemic – a staggering sum that caused very little public debate. Those sceptical about so-called ‘quantitative easing’ argue that it causes inflation – and with today’s news that inflation rose 9 per cent on the year in April, is anyone linking the two? Step forward Mervyn King, former governor of the Bank of England, who was surprisingly critical when speaking to Andrew Marr on LBC last night. One of the major problems, Lord King said, was that the Bank went too hard and too fast with its money printing. ‘Governments stepped in and put in a lot of

With every sausage war or fish fight over the past 18 months, the chances of survival for the Northern Ireland protocol have narrowed. But the fallout from the NI Assembly elections, which saw Sinn Féin become the largest single party, has made it increasingly likely that the UK will take unilateral action to override parts of the Brexit deal. The protocol has few supporters. Arguably its only redeeming feature was that it allowed Boris Johnson to break the deadlock and conclude the withdrawal agreement. Because a porous land border between the UK and the Republic would have threatened the single market – and a hard border between Northern Ireland and the Republic