Philip Booth writes for Prospect
His first act, in true treasury style, was to break the first rule in the fiscal consolidation handbook: he ramped up taxes and promised some spending cuts later, hoping that growth would do most of the work in reducing the deficit. Of course, growth has not materialised and total government spending remains uncut. The tax rises — together with other events outside the chancellor’s control such as the euro crisis — have contributed to reducing growth. When you cut a deficit, the rule is to cut spending first — especially if the deficit is caused by high spending.
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