Remember all the fuss last year when it was reported that the UK’s public debt-to-GDP ratio had hit 100%? This happened in the May data and again in July, but in both cases the figures were later revised down. In January 2021, net debt was still ‘only’ 97.9% of GDP. This is mainly because the … Continue reading A quickie on the UK debt-to-GDP ratio…
Tag: bank of england
The centrepiece of Keir Starmer’s big policy speech on Thursday was a proposal for a new ‘British Recovery Bond’. It’s a nice idea on paper and many other people, from both left and right, have backed similar schemes. But it’s still hard to see what it would actually achieve in practice. To recap, the plan … Continue reading What’s the point of ‘British Recovery Bonds’?
How deep a hole are we in? The Institute of Economic Affairs has just published a primer I’ve written on the state of the public finances, which digs into this question. On the bright side, I argue that there is no need for any form of austerity, including tax rises, to fill a gap left … Continue reading Why we don’t need tax rises to pay for Covid
I’m relatively relaxed about the fiscal costs of Covid: UK government borrowing will drop sharply as the economy recovers; the increase in the debt burden is manageable; and there’s no need to ‘pay for Covid’ with ‘austerity’ of any kind. (See my earlier blog explaining How I Learned to Stop Worrying and Love the Debt.) … Continue reading Why fiscal responsibility still matters