The chancellor's spring statement signifies a bleak economic outlook for Britain, emphasizing necessary cuts in welfare payments and public services. The narrative of austerity is critiqued as political theatre, suggesting that these constraints are self-imposed rather than absolute. Despite announcing significant additional spending last October, the government faces a crippling debt interest burden of over £100bn annually. This scenario is exacerbated by the Bank of England's quantitative easing strategy, which has increased borrowing costs. The article argues that redirecting resources from debt repayments to public welfare should be prioritized over appeasing financial markets.
The idea that painful cuts are inevitable is political theatre. Either Rachel Reeves knows the constraints are self-imposed or believes they are real.
The UK now spends more than 100bn a year on debt interest a postwar high not because it is bankrupt, but because the Bank of England is offloading vast amounts of gilts.
Ending QT could redirect that money to public services a better priority than reassuring markets with symbolic gestures.
If the Bank won't stop on its own, it must be pushed. Gordon Brown granted it independence in 1998 but included a safeguard.
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