Theresa May is pandering to her pro-Brexit supporters. The important public finance issue, which is unresolved, is whether to raise taxes or abandon austerity – or both
When she was interviewed on Sunday’s BBC One Andrew Marr programme, Theresa May knowingly and dishonestly suggested that leaving the European Union was the central dynamic behind her new NHS spending pledges. Having started by saying she was determined to secure the NHS’s future, she immediately invoked the shoddy Brexit campaign bus slogan of 2016 with implied approval. Then she talked about the money Britain would save by leaving the EU; finally she deliberately spoke in ways that would lead any unwary listener to assume that a so-called “Brexit dividend” was the windfall that enabled her to make the new spending pledge. Characteristically, Boris Johnson was even more mendacious, calling the pledge “a down payment on the cash we will soon get back from our EU payments”.
All of this was a lie. It disgraces Mrs May to tell such a whopper. True, by the time that she gave her speech on NHS spending on Monday, her words were rather more circumspect; the essential deception nevertheless endured. “Some of the extra funding” will come from money that now goes to the EU, she said at London’s Royal Free Hospital, “but the commitment I am making goes beyond that Brexit dividend.” That is true with bells on, since the NHS pledge dwarves any future savings on the UK’s Brexit payments.
IMF figures show the world is more indebted than during the financial crisis and needs more borrowing to create growth
At the end of May, the International Monetary Fund launched its global debt database. For the first time, IMF statisticians have compiled a comprehensive set of calculations of public and private debt, country by country, constructing a time series stretching back to the end of the second world war . It is an impressive piece of work.
The headline figure is striking: global debt has hit a new high of 225% of world GDP, exceeding the previous record of 213% in 2009. So, as the IMF points out, there has been no deleveraging at the global level since the 2007-08 financial crisis. In some countries, the composition of debt changed, as public debt replaced private debt in the post-crisis recession, but that shift has mostly stopped.
Concerns likely that country will suffer fourth collapse unless EU writes off some debt
Eurozone finance ministers are braced for a row this week with the Greek government over the terms of a “golden goodbye” as the country prepares to exit its third bailout programme.
Concerns that Greece will suffer a fourth financial collapse unless an agreement is signed with the EU to write off some of its debt mountain are likely to surface before a showdown in Brussels on Thursday.
Marks & Spencer’s announcement last month that it would close more than 100 stores by 2022 sent shockwaves along UK high streets. In 2015, Aldershot lost theirs – and this is what happened next
Beneath the ghostly imprint of the Marks & Spencer lettering, Kerryann Wade recalls the day management called staff upstairs to a meeting. It was June 2015 and the store in Aldershot had survived, while shops around it disappeared. Just a few doors along the Hampshire town’s High Street, two other units bear traces of busier times; Woolworths, shut in 2008, sits next to Blockbuster Express, which clung on until 2013. Both stores remain empty.
“We were all thinking: ‘Where’s the champagne?’ Because we were usually called upstairs to hear how well the store was doing,” Wade, 42, recalls. A handle is falling off the store’s old glass doors. Wade has kept the alcohol licence sign that hung above the door because it bore her name as the former food manager. “But when we got there, they said ‘Sit down’, and I said: ‘No, I want to hear it now.’”
Living through the biggest economic slump in a century, it’s no surprise that people are angry
There has been much debate about why the public has started to lose faith in mainstream political parties but the reason behind the rise of populism doesn’t take much working out.
The past decade has seen the biggest financial crisis in a century, the biggest slump since the Great Depression and the slowest recovery since the second world war. Living standards have flatlined and public spending has been cut.
Theresa May’s endless prevarications are not just infuriating her own MPs, but British business as well
‘Neither Labour nor the Tories have a credible plan for Brexit,” declared Lord Macpherson, former top official at the Treasury, on Twitter. This distinguished civil servant, who has seen ministers of both major parties grapple with economic crises, went on to ask: “Have the British people ever been so ill-served by the two main parties?”
It is no wonder that the EU negotiator, the estimable Michel Barnier, finds himself, week in and week out, having to point out that all the imaginative solutions with which he is presented by the British have, indeed, to be left to the imagination.
None of the alternative ‘soft Brexit’ options is anywhere near as satisfactory as the position we are already in
With the base rate in the eurozone still at 0%, funds are flowing back to the US using a myriad of financial instruments
While governments around the world contemplate the fallout from Donald Trump’s trade war with China, banks are wrestling with central bank moves that are likely to have a much more fundamental impact on the global economy.
On Wednesday the US Federal Reserve pressed ahead with its policy of raising interest rates, adding a seventh quarter-point rise since 2015 to leave the base rate at 1.75-2%. The Fed also pledged to continue selling back to the private markets loans it bought as part of a vast $4.5 trillion quantitative easing programme.