Brown’s second spending spree

Public spending is currently accelerating at an unprecedented pace — more swiftly, even, that during the total loss of control during the 1970s. Spending is due to rise £120bn, 20%, in just three years from 2007/8 to 2010/11, taking it from 41% of GDP to above 50% — a much more rapid rise than in other parts of the world, lifting us from well below the EU average to well above. The considerable majority of this rise is not the automatic result of the recession (extra unemployment benefits, etc.) – only 38% takes this form. Neither is it any kind of “public works” programme – only 6% is extra capital spending. Instead, the vast majority is extra consumption spending. Many economists might support increasing spending during a recession. Few would support increasing spending for this.