Pendulum on UK's relationship with the EU has begun to swing. The Jacobins are on the retreat. The idea we will have a relationship like Switzerland is a good start if entirely fanciful. But every climb down has to start somewhere.
@nickmacpherson Welcome to Mastadon Nick!
@t0nyyates Better to arrive than to travel. Look forward to injecting some orthodoxy into economic debates.
@nickmacpherson Have we hard the Macpherson take on the new budget yet?
@t0nyyates Mr Hunt has stabilised the gilt market for which we should be grateful, while supporting demand. Tax increases fair by recent standards. Spending changes largely pain deferred unless you're a public sector worker where the real wage cuts look bigger even than in 1931 which could put delivery at risk. Growth agenda could have been stronger, eg on skills. But as 4th year of a parliament hoves into view pretty "courageous", reminiscent of Clarke and Darling. #soundmoney
The shortfall is not just the “growth agenda” but is also the complete inadequacy of the revamp of the energy price guarantee-cum-support system. That remains far too untargeted and expensive, compromising both fiscal sustainability and immediate delivery—public sector wage—priorities.
@nickmacpherson Is this the Conservative sensibles playing the long game? Knowing they’re out at the next election, they no longer fear the ERG. If they can take the first steps to improve the EU relationship (stealing Starmer’s thunder) and let Labour do the spending cuts they’ve tabled, they could find themselves back in power after one term of opposition.
@TrevorGreetham Not sure HMG yet realises the degree of compromise necessary to get a lasting deal on trade let alone the N Ireland protocol. And whether or not the post 2024 spending plans are sustainable is likely to become clear sooner rather than later.
@nickmacpherson In reality I imagine negotiations would run well into the next government. But if this one can convince the OBR to pencil in a less hard Brexit, it could possibly make them some fiscal space.
@nickmacpherson my instant reaction as well, that Brexit as we’ve known it pretty much snuffed it with these reported comments. The Swiss type arrangement as @CoppetainPU points out is complex and heresy for the ERG, but those tectonic plates feel for 1st time like they’re starting to move