It’s vital we act now to fix the ticking time bomb under our economy

The UK economy is not in good shape. We invest a lower proportion of our GDP every year than almost anyone else, which is the main reason why our productivity is almost static. We have deindustrialised to a point where we do not have nearly enough to sell abroad to pay for our imports. We have a chronic balance of payments problem financed by selling assets and borrowing from abroad. As a result, both as individuals and as a nation we are getting deeper and deeper into debt. What growth we have is driven by consumption, financed by asset inflation rather than by exports and investment. On almost every measure, inequality is growing.

There is a simple answer as to why we have these imbalances which have locked half of our population into static or falling living standards: for decades, the UK has had an over-valued exchange rate, which has slowly bled the life out of the economy’s ability to grow.