In two weeks’ time from today, the Chancellor will stand to make his fourth Budget speech.
It is only a couple of months since the Autumn Statement, and already the OBR’s forecasts look pessimistic. Independent growth forecasts are up, unemployment is falling fast and inflation is down. Those critics who argued that cutting the deficit would doom Britain to a triple dip recession have been disproved.
Now, the same critics argue that recovery was bound to come eventually whatever the Government did. Strangely, they did not think to make such predictions two years ago. Similarly, many economists warned last year of the US Government’s ‘fiscal cliff’. According to the IMF, the US’s austerity measures cut their deficit in 2013 at twice the pace chosen for Britain. It turned out that the only country in 2013 out of the G7 to grow as fast as Britain was America. Fiscal responsibility works....
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