Johnson's dilemma is false: 1/ Yes we need to save 000s of businesses/jobs reliant on summer... but No it won't bankrupt the Treasury to keep furlough/bailouts going in a different form - that's the missing piece of politics....
2/ We need an urgent and overt change of economic model so that the anti-crisis measures become a transition cost not money down the drain - it consists of... state-led investment, a job guarantee and free basic services...
3/ We need to accept >120% debt/gdp and use the headroom to borrow strategically. Bank should overtly monetise to control interest payments - and we do green state capitalism on steroids - there wd be x-party support ...
4/ .... without a growth strategy this lockdown-vs-jobs dilemma will crunch the UK economy thru a series of waves. A debt/monetisation strategy lets you ride thru the waves of the pandemic but let's be clear about the destination: domestic-led growth ...
5/ As Hein et al argue the only safe place to be in a fragmenting global economy is a domestic-demand driven growth model. It's not protectionism to say we need govt-backed strategic sectors and a return to wage growth ... debt and progressive taxation has to take the strain ...
6/ On tax take - it will have to rise, but unless it comes from high earners, offshore corporations and wealth it will tank demand. So shutting down the offshore finance system is the first act...
7/ Politically be prepared: second wave of deaths is coming and the government will abandon lockdown strategy and ditch the scientists - that will be a tipping point for Scotland/Wales, which won't wear it... but Parliament will be in a long recess...
8/ ... if Johnson unilaterally ends lockdown in late June with R close to 1 then by the Autumn we could be in Lombardy territory. The only way out is commit to high debt and state-led reconfiguration of economy, not life support.
