Writing in Comment is Free, Mr. Hutton argues that the double-dip recession is all George Osborne's fault, and that if only the government were to spend more freely we wouldn't have this problem.
The first part of his thesis is reasonably defendable, but sadly obvious - of course what is happening is down to George Osborne, he's the Chancellor and has been since May 2010, so after 2 years we can reasonably attribute at least a significant part of Britain's economic performance to his decisions and actions. Fair enough.
Except... except we can't look at what's happening now and say "this is bad, therefore George is at fault". We must look at the alternatives given Osborne's starting position - he didn't exactly inherit an economy overflowing with roses, despite what Hutton claims:
Britain has a very strong public balance sheet. The stock of our national debt, accumulated over decades, is modest compared with other countries and our own past. The rate of interest is the lowest since the 1890s. The debt is exceptionally long term and does not need to be refinanced with any sense of panic. Total debt service costs have been higher for only a few decades over the past 200 years.True enough, Will. And yet, why is this true? Look at Government bond spreads. The UK is at 2.15%, just off the USA's benchmark at 1.99%. Spend like France and you're at 3% - that's your interest payments just gone up 40%. Spend like Italy or Spain, and you're well over 5.5%. The reason that the markets buy our debt at low yields is precisely because the Government is trying to close the deficit. If we turned the spending taps on, or Ed Miliband looked like he was getting back into power, you'd very quickly see a rise in what we pay. And issue debt we must, because we are still running a primary deficit.
Luckily, Will Hutton can help us out of this mess by stimulating growth:
At bottom Cameron, like Osborne, has a primitive view of what makes capitalism tick. He does not understand the complexity of the inter-relationships between business, business risk, innovation and the state.I see, Will - and you do understand this complexity? Perhaps Osborne only understands that it is indeed complex, but I'd love to see you make a coherent stab at explaining these inter-relationships in any way that holds up under scrutiny.
He buys wholeheartedly the mantra that what mainly obstructs business is red tape, public sector debt and labour market regulation.Sounds about right to me. You can argue about whether their obstruction is worth while given the risk mitigation and social improvements that red tape, a high minimum wage and 6% of total 2011 national spending going on debt servicing costs brings, but you have to at least concede that such obstruction takes place.
Ah, Will. You whine about the bad, without any concrete proposals as to what to do to make it better other than "spend more money, I'm smart enough to figure out where". After all, you did such sterling work at The Work Foundation. For a Principal at at Oxford College, you seem to have rather woeful debating skills by leaving such large holes in your arguments that even I can drive through them.