|  Updated: 

Autumn Statement: This ‘pragmatism’ looks like a recipe for flat growth

By: and

Add as a preferred source on Google
The Office for Budget Responsibility (OBR) has downgraded its growth forecasts for the UK economy over the next couple of years as higher interest rates bite.
higher interest rates bite.

This Autumn Statement betrays a Conservative party that’s given up on the free market

What does the Conservative party stand for? It is a question that has intrigued for decades. Some Tory ‘philosophers’ opine that it’s not so much an ideology as a belief in pragmatism – of doing the sensible thing. Others argue it’s a project rooted in the free trade arguments over the corn laws.

Well, this is what the Conservative party stands for at the moment.

Higher taxes on aspiration, and stealth taxes on the labour of ordinary people. Arbitrary windfall taxes on productive industries. Higher spending on the NHS, without any obvious requirement on it to reform. Cuts to capital spending in the long term. Tax raids on entrepreneurs and those with small investment portfolios, or those who’ve built up share options whilst working in high-growth start-ups. It stands for hiking government spending from 39.6 per cent of GDP in 2020 to 43.4 per cent of GDP in 2028, and pushing taxes up from 36.7 per cent of GDP to 41.1 per cent over the same period. It stands for – and please do write in if you’ve clocked how this works – costly net zero commitments whilst also whacking taxes on electric cars. It stands for millionaire pensioners. It stands for the housing status quo. It stands for a rail network that’s half nationalised and half broken. It stands, in short, for decades-high levels of taxation and decades-high level of dissatisfaction with public services.

Perhaps this Autumn Statement is just the sensible thing – a pragmatic attempt to get markets back onside and then, assuming global factors bend in our favour, cancel most of what was announced yesterday in a couple of years. It’s hard to shake the idea though that we are headed too far, too fast in the opposite direction to Kwasi Kwarteng et al – a disastrous high-tax, low-spend economy that will strangle growth now and in the long term. The worst bit? Labour might still be even worse.

The greatest tragedy of Trussonomics is that the execution was so bad her ideas have disappeared with her.