Well, Stephanie Flanders thinks so.
Between the economists, the disagreement about the medium-term may be larger. But that is not the area they have chosen to focus on in today’s letters. Their focus, rather, is on the risks of a “sharp shock” in fiscal policy in 2010, beyond the “shock” that is already in train (which is going to be pretty shocking for very high earners). Is there a risk of a “sharp shock” in policy in 2010? I’m not sure I can see it. In fact, I cannot think of any serious participant in the UK debate who has openly called for “swingeing cuts” in borrowing in 2010/11. It is a straw man.
So does Ed Conway:
The only real difference seems to concern: 1. the full scale of the cuts – the Besley signatories would like a wee bit more; and 2. the timing, with the Besley camp wanting the cuts to come a year (or even a few months) earlier. This really is a marginal difference, and completely overlooks just how harsh are the spending cuts already proposed by Labour
and Hamish McRae:
there has to be a medium-term plan after the election to bring the deficit down. All those economists would agree on that. I cannot imagine a single one who would argue that the deficit next financial year should be larger than the deficit this year … all right, I concede that there is one on the second list who has nutty views and he might. But even he would have to admit that there should be a medium-term fiscal consolidation plan
Who disagrees? Will Hutton seems to, though even he seems to think the economics is settled:
Bystanders may think that the battle between 60 economists who signed letters to the Financial Times repudiating the 20 who earlier signed a letter to the Sunday Times urging that Britain’s public deficit to be eliminated in the lifetime of a parliament is a battle over economics. It is not. Economics is on the side of the 60. The gulf is about the morality of debt.The Sunday Times 20 are less economists and more, like the Tories, debt moralists.
I agree about the absurdity of being overly moral about debts. My children will have to bear it … well boo hoo. I have changed about 3000 nappies in the last 7 years. Parent-child relationships are the most asymmetric possible. They are not helpless when they repay debts: they tend to benefit from huge assets, learning and inheritances (yes, they also suffer our environmental degradation. We should watch out for that).
Having just come out with such a non-IEA line on something, I would like to thank them for weighing in against the nefonomics of the 21 hour week.
I’m not going to talk about bullying. I was planning a blogpost when I got a call from Number 10, threatening to give me Chinese burns if I so much as thought of it.