A former member of the Bank of England’s Monetary Policy Committee (MPC) will argue this week that the UK Government’s expenditure cuts are a “major mistake” that will have to be quickly reversed.
In a speech in Edinburgh this evening (18 October), Professor Danny Blanchflower is due to argue that there is no economic basis for a ‘front-end loaded’ programme of public expenditure cuts. He dubs the Government’s approach as the “economics of wishful thinking”.
His intervention comes two days ahead of the Chancellor publishing the Comprehensive Spending Review, setting out his public finance proposals for the years ahead.
As a member of the MPC, Blanchflower was among the first to fear that the economy was headed for a recession.
Blanchflower, along with his co-researcher Professor David Bell of Stirling University, has been examining the likely employment and unemployment implications for Scotland.
“The latest labour market data for Scotland are disturbing,” said Jeremy Peat, director of The David Hume Institute, which is hosting the event.
“Blanchflower and Bell’s research, set against the backdrop of Danny’s views on the coalition’s policies and their macro impact, will make this seminar highly relevant for those interested in both the UK and Scottish economies,” added Peat.