Rachel Reeves's enthusiasm for the City of London raises concerns among economists who worry that deregulating financial sector regulations could undermine economic growth and government strategy.
The rules established post-2008 were meant to curb the sector’s excesses and prevent systemic risks, meaning rolling back such regulations overlooks the stability they provide.
History has shown little evidence that expanding the financial sector leads to broader economic prosperity, especially when it siphons resources from the real economy.
Instead of deregulating further, enhancing labour-intensive industries neglected over the years could promote greater economic health and address issues of stagnant pay and mobility.
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