...especially as one can plausibly argue that the long-term fiscal benefits will outweigh the short-term fiscal costs due to an increase in the future earning power of the kids affected...
...Is there a legitimate concern the temporary extra tuition spending could turn out to be permanent?
Is that what the polling is trying to get at?...
...If so the relevant question surely ought to be:
"Would you be prepared to pay higher taxes to fund a permanent increase in education spending after the pandemic?"...
...Still, beyond that quibble, it's got lots of useful polling evidence on what parents actually think about the degree of harm to learning from lockdown, extending the school day, what subjects should be prioritised in catch-up etc
This feels rather like the Brexit political economy chickens coming home to roost. 👇
As experts stressed before & after the referendum, the politics of trade deals comes down not just to aggregate economic outcomes but industrial/sectoral interests...
...In theory everyone wins economically from reducing trade barriers.
In practice the economic impact is uneven across different sectors of the economy - and that's often a political barrier to doing trade deals...
...The government's own modelling analysis shows a positive (albeit small - 0.01-0.02%) long run impact on UK GDP from a UK-Australia free trade deal...
The idea stronger growth this year means Sunak can cancel future tax rises seems confused to me - or at least an incomplete analysis.
Brief thread 🧵
Assuming no public spending changes, when it comes to pressure for tax rises to balance spending with tax revenues...
....what matters is the projected structural deficit *after* the recovery is complete.
And what determines *that* will be the scale of long-term scarring to GDP (i.e the level of GDP relative to pre-crisis expectations)...
The Bank is currently projecting 1.25% GDP scarring...
....A faster recovery to a lower (scarred) path of GDP doesn't change the size of the post crisis structural deficit & longer term pressure for tax rises.
For that to happen you need projections of lower scarring...