Missing from the Budget is any discussion or action at all on addressing the economy's problems post covid. What health budget will be need to put us in a better place to deal with another one, or will we not bother trying to prepare [the implication of where we are]?
The pandemic has been incredibly regressive in terms of - impact on children's education; mortality; who can homework and who cannot; square footage that one is locked down into. Any thoughts on addressing that, or do we just proceed as though it didn't happen and won't?
What will be the hangover on expenditure patterns, demand for space, where people want to live and work? What role, if any, is there for government in facilitating dealing with this legacy/transition?
What ongoing needs will there be for vaccination / therapy research and delivery? For changes in educational real estate and provision?
We seem to be assuming that come September it's as if Sars-cov2 never happened. Or to the extent that it isn't it's not the government's problem, won't impinge on spending, and the rest of us can deal with it.
What about social care too? There was anyway a funding problem, and now we know that there is a potential for a massacre, are we back to just not dealing with the old problem and ignoring the new death risk?
We seem to be assuming that the pandemic risk is such that there won't be another one in a time frame that interferes with the strategy of just growing away the debt burden. Is that right? What is the evidence?
Perhaps there's an assumption that if there is another pandemic in a shorter time frame than that, it won't be costly, because we will deal with it quickly, a faster vaccine, more health capacity, better test / trace / isolate / border quarantining infrastructure.
But if that's the case what do we have to do to get from where we are [facing costs like we just faced, because we have poor test and trace, limited ICU capacity, poor border quarantining, fast but not instantaneous vaccine technology, etc] to where we want to be?
And how much will it cost?!
The budget can be summarized as 'this bad thing has happened which gobbled a lot of money, but it will stop gobbling in about September, and then we will just be a bit poorer and other than that we will carry on. Thanks for bearing with us.'
Another way into this is to ask ourselves what went badly for us during covid, and well for other countries, and is it feasible for us to replicate the good bits of other countries' strategies, and how do we do it and pay for that and is it worth it?
Ask yourself another question. If we'd just come out of a regular large recession, say, how would the budget talk look different? The public health disaster we have lived through leaves no imprint. This could be a 2010 budget, or a 2040 budget.
To clarify, I'm not saying the Budget should look like the Budget coming out of a regular recession. It does look and sound like it, but since this is a profoundly different circstance with special, huge and complex legacies, the Budget should reflect that.

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More from @t0nyyates

3 Mar
Will be interesting to see what the new @bankofengland remit, described today, is interpreted to mean.
Skewing corporate bond purchases [which don't amount to very much] towards greener firms? If so, how much of a skew would qualify as meeting the target?
Such a skew would presumably increase the credit risk for a given portfolio, in the short term. BoE indemified against that, but how much extra credit risk is acceptable per unit of greening?
Read 4 tweets
2 Mar
Philip Collins saying that Labour like Boris Johnson taking their policies of generous deficit financed policies during the covid crisis. I think the opposite. Labour would prefer the Sunak view to win out so it can stand alone on fiscal activism [clear red water].
Right now Labour is confined to making minor technical points here and there. Or bringing up past failures, which sounds like point scoring during a national tragedy.
I think the Collins view derives from thinking that fiscal conservatism is being 'good on the economy', which, if it were so, would put Labour in a trickier spot.
Read 7 tweets
2 Mar
Fair chance that some of a recorded piece on government borrowing, talking to @lewis_goodall, will make it into @BBCNewsnight tonight.
I wrote at length about this in a piece for @prospect_uk a while ago: prospectmagazine.co.uk/economics-and-…
Tuning in, there's a game on TV where you have to guess whether someone on zoom is wearing trousers or not. Just to be clear, I was definitely wearing trousers.
Read 4 tweets
2 Mar
Points out @GeorgeOsborne put political interests of the Conservatives above those of the nation + did well out of it electorally, though putting us in a much worse place to weather the pandemic. But what exactly is in the political interests of the Conservatives now?
As @jdportes points out, mainstream econ opinion has moved doveish somewhat. Circumstances have forced the Tories' hands. And the electoral focus on the mythical 'Red Wall' tilts them to fiscal activism in the short and long term.
Read 4 tweets
2 Mar
One of the things missing from the fiscal / covid strategy debate around the budget is what the risk of another pandemic is, and what it looks like if one hits.
If we are going to get one every generation, then the strategy of rolling over the debt indefinitely and allowing growth to shrink it as a portion of national income reduces what we should be doing by way of support to what would be shrunk by that growth subsequently.
That is, if you believe in finite fiscal space, which I do.
Read 4 tweets
2 Mar
The William Hague article on debt is actually really weird and I can hardly follow it. But basically it's wrong.
It's ironic that he sets out on a hearty historical analogy. Because historically speaking our spikes of debt/GDP have been unwound not by paying down debt, but by growing GDP, a bit of inflation [quite a bit in the 70s and 80s] and financial repression.
What does this mean? Image
Read 10 tweets

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