Wednesday, July 20, 2005

Rusty Old Iron Chancellor

Having extended the economic cycle by two years, does Gordon Brown really believe the next two years will be better than the last two? House prices continue to fall, retail sales continue to fall, borrowing continues to surge and inflation is rising. Taxes are already at historically high levels, any further increases will only slow economic growth further or reduce overall tax revenues. He is running out of options and out of time. Public spending desperately needs cutting.

As the economic cycle runs it's course, I suspect the Iron Chancellor's reputation will start to rust. Where is the fiscal prudence he was lauded for in the early years? Great Chancellors prove themselves in difficult economic conditions, not good ones. As the first and only Labour Chancellor since 1997, even he will struggle to find someone else to blame.

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