It seems Mr Umunna is even ready to sink his own credibility in order to undermine the party he still claims to represent.
He has written an article in The Independent which Oxford University macroeconomist Professor Simon Wren-Lewis has rubbished in his Mainly Macro blog.
This Writer’s only criticism is that Prof Wren-Lewis headlines his article with a claim that it is a sign of “Labour’s growing macroeconomic illiteracy” – when it is far more likely to be a sign that Chuka should cross the floor and join the Conservatives he most closely resembles.
Chuka wrote: “To be running a deficit in 2007, after 15 years of economic growth, was still a mistake. My party’s failure to acknowledge that mistake compromised our ability to rebuild trust in 2010 and in 2015. If a government can’t run a surplus in the 15th year of an economic expansion, when can it run one?”
This is the Tory line in a nutshell – and nonsense. Mainly Macro‘s response: “What Umunna is saying here is much the same as George Osborne’s proposed rule: in normal times when the economy is growing run surpluses. But Osborne is saying that in the context of the current debt to GDP ratio of 80% of GDP. Umunna is implying that policy still made sense back in 2007 when the debt to GDP ratio was below 40%, the output gap was thought to be small and no one was expecting a global financial crisis.
“I cannot remember anyone before 2008 suggesting Labour’s debt limit should fall over time. Yet Umunna says the mistake was so serious it helped lose Labour two elections.”
In other words: What a load of rubbish.
“I would love to know who the economists are that gave Umunna the advice that led to this article,” writes Prof Wren Lewis. Who says anybody did?
To prevent claims that he is over-exaggerating a couple of sentences from a larger article, the Professor again quotes Chuka: “Reducing the deficit is a progressive endeavour – we seek to balance the books because it is the right thing to do.” This claim – that it is “the right thing to do” is straight out of the Tory phrasebook.
The response: “Would he give the same advice to UK businesses: refrain from borrowing and focus on paying back your debt? Somehow I think not. The Conservatives have a kind of excuse for deficit fetishism – it is a useful device for shrinking the state. That excuse should not apply to senior Labour figures.”
This Blog can see little future for Labour if a politician with so much sympathy for Conservative policies – and so little understanding of economics – remains on Labour’s front bench. Chuka has had his day.
It’s time he chucked it in.
Follow me on Twitter: @MidWalesMike
Join the Vox Political Facebook page.
If you have enjoyed this article, don’t forget to share it using the buttons at the bottom of this page. Politics is about everybody – so let’s try to get everybody involved!
Vox Political needs your help!
If you want to support this site
(but don’t want to give your money to advertisers)
you can make a one-off donation here:
Buy Vox Political books so we can continue
fighting for the facts.
Health Warning: Government! is now available
in either print or eBook format here:
The first collection, Strong Words and Hard Times,
is still available in either print or eBook format here:
And he’s not the only “red” Tory either, I feel that many of those sitting on the Labour benches would feel more at home on the Tory side of the house.
Another blair baby untill he shown the door
By continuing to bang on about the deficit he’s conveniently helping stop any related conversations from going elsewhere, like jailing bankers, for example. I understand his office staff are supplied by Big 4 accountants Price-Waterhouse Cooper, who I believe have many of the major banks as clients. Hmmmm… the thought does cross my mind perhaps the PWC staff supplied more than a mop and a bucket this week 🙂
Now, that makes a lot of sense!
Jeremy Corbyn for Labour Leader!
Another Tory plant. These people definitely need to be weeded out sooner rather then later.
If you have to save your money during the good times – assuming even this is correct considering we issue our own currency without anything to back it up – and bail the economy out with those savings in the hard times, when do we have a desperately needed increase in spending on the NHS and schools? Because for sure they’ll be at the back of the queue in a recession.