Tuesday, 21 January 2014
IMF Upgrade for UK
However, austerity is not the cause but offers partial solution. Better still would be the re-structure of the welfare state in the West along more Hobbesian lines, but for now that is incompatible with democracy. So austerity of some sort remains the best approach. The Coalition government at least did apply the brakes to Labour spending and after some time is now reaping the rewards with a more stable growth than has been achieved in say the US. The IMF were very quick to blame Osborne for his crazy (read, un-French) policies and now the UK is prediceted to be the fastest growing Western nation this year.
It must make for a little bit of extra spring in the Chancellor's morning jog today.
The real challenge lays on two fronts though. Firstly that there seems to be no political benefit to the 'hated' Tories for engineering a recovery - after all, it's what they said they would do. Secondly, with interest rates at 0.5% and QE in place, we are still deep in the middle of the woods with no clear path out yet identified.