If anyone ever thought Mr Brown was good at economics his latest statements that the Conservatives want to take £6 billion out of the economy and that would wreck the recovery ought to change their mind.
Reducing the public sector deficit by £6 billion does not take money out. Public spending is either financed by taking money out of the private sector through taxes, or out of the private sector by borrowing it from them. Borrowing less from the UK private sector leaves that sector with more money to spend on what it chooses.
£6 billion is a small sum in a £1.4 trillion economy: less than 0.5%. Mr Brown instead should be asked to explain why RBS, the bank he bought for taxpayers, has slashed its balance sheet by £700 billion over 2009 and plans to slash it by another £300 billion in 2010. That is significant money, even allowing for the global reach of the business. That does have an impact on the UK. Mr Brown’s banking policy is the main reason the UK economy is scarcely growing. His large public sector deficit remains a threat to stability and a cause of a damaged private sector.
Promoted by Christine Hill on behalf of John Redwood, both of 30 Rose Street Wokingham RG40 1XU