Osborne's Corporatism Isn't Fiscal Conservativism

There is often more truth in satire than news reporting and yesterday gave us an amusing example. The Chancellor’s vague plan for the Treasury to buy small firm’s corporate bonds was reported on by the Daily Mash thus:

Osborne’s offer of credit to thousands of small businesses will make Britain the first conservative-led communist state when the loans are inevitably defaulted and the government ends up owning and running everything.

The Chancellor seems to think the solution to the credit crisis is more debt, even though many businesses are doing the opposite and de-leveraging. Banks make money from lending and they lose money lending to bad credit risks. The government thinks the banks are being too cautious even though the markets think there is serious trouble ahead. Guido thinks the markets have it right.

When challenged to introduce growth-stimulating tax cuts the Chancellor refrains saying that he won’t because he is a “fiscal conservative”. George Osborne presumably would concede that Nigel Lawson was also a fiscal conservative, yet he managed to cut the top marginal tax rate from 60% to 40%. There is nothing fiscally conservative about maintaining a tax rate so perversely high it generates lower revenues by driving high earners out. This isn’t fiscal conservativism, it is political defeatism.

It is even less likely that fiscally conservative Nigel Lawson would countenance Osborne’s proposed socialisation of the corporate credit markets. When the government starts lending money to companies that no one else wants to lend to, you can be sure of one thing, they are going to lose a lot of taxpayers’ money. Billions.




Tip offs: 0709 284 0531
team@Order-order.com

Quote of the Day

George Osborne paraphrases Boris, telling the FT:

“If the ball came loose at the back of the scrum, I wouldn’t fumble it”

Guidogram: Sign up

Subscribe to the most succinct 7 days a week daily email read by thousands of Westminster insiders.

Facebook

Jackie Walkercaust Jackie Walkercaust
Jim The Salesman Spotted With Corbyn Jim The Salesman Spotted With Corbyn
Labour Illiterate On Illiteracy Labour Illiterate On Illiteracy
Momentum Mock Injured Soldiers Momentum Mock Injured Soldiers
I SCHEMED A SCHEME I SCHEMED A SCHEME
Watch Glitter Balls Watch Glitter Balls
Did Boris Really Want Brexit? Did Boris Really Want Brexit?
Ken Interviewed, Doesn’t Mention Hitler Ken Interviewed, Doesn’t Mention Hitler
Chuka’s Single Market flip-flop Chuka’s Single Market flip-flop
LABOUR HQ PURGE FEARS LABOUR HQ PURGE FEARS
Carter Ruck Deleting Brooks Newmark Sext Pics Carter Ruck Deleting Brooks Newmark Sext Pics
Mandelson Aide Funding Owen Smith Mandelson Aide Funding Owen Smith
OILY WANTED CORBYN TO GO ON OILY WANTED CORBYN TO GO ON
Hinkley: Forseeable Financial Fiasco Hinkley: Forseeable Financial Fiasco
Baroness Shami(less) Baroness Shami(less)
Just How Totes Posh Is Stella Creasy? Just How Totes Posh Is Stella Creasy?
Thornberry “Sky Sexism” Meltdown Thornberry “Sky Sexism” Meltdown
WATCH HILLARY DROP WATCH HILLARY DROP
PMQs Sketch PMQs Sketch
Vaz Broke Law Vaz Broke Law