Britain’s strategy for managing the massive debts incurred in responding to Covid will be the political question of the next decade and beyond, so Radix makes no apologies for returning to the topic once again.
In his budget earlier the year, the Chancellor repeated the now well-worn mantra about needing to live within our means and began to spell out strategies to pay off our debts through higher taxes and reduced spending, even if the pain was delayed.
Earlier in the year, Radix subscribers heard Prof Randall Wray, leading exponent of Modern Monetary Theory, debate with Prof Paul de Grauwe an alternative Keynesian-style strategy designed around spending our way back to economic growth.
But the one thing that all economists agree on is that boosting growth is essential to reduce debt. Many measures that could boost growth – from industrial policy to skills strategies to devaluation – have been put forward but are unlikely to provide a silver bullet alone. So what are the possible combinations of reforms? And what can we learn from other countries and from the past?
