Economists defend Corbyn economics
The letter, signed by 40 economists up and down the UK and published on The Guardian, stated that the UK economy is currently being run on an extremist basis and Corbyn’s policies are not extremely left on the political spectrum.
Corbyn’s proposals, which include using of quantitative easing to boost infrastructure and for a version of right to buy in the private sector, have come under fire across the mortgage industry. For example earlier in the month Robert Sinclair, chief executive of the Association of Mortgage Intermediaries, said on the right to buy suggestion: “A policy of this type, should Labour ever get close to being elected to power, could damage the property market in a way that the Financial Policy Committee is currently very keen to avoid.
“Sudden shocks and precipice events are outside the current economic policy framework.”
The Labour leadership will be decided by 10 September, with Corbyn being the clear favourite in the contest.
The letter read: “Cutting government investment in the name of prudence is wrong because it prevents growth, innovation and productivity increases, which are all much needed by our economy, and so over time increases the debt due to lower tax receipts.
“Despite the barrage of media coverage to the contrary, it is the current government’s policy and its objectives which are extreme.
“The attempt to produce a balanced public sector budget primarily through cuts to spending failed in the previous parliament. Increasing child poverty and cutting support for the most vulnerable is unjustifiable.”
The move was reminiscent of the 100 business chiefs who wrote to The Telegraph in April before the election saying Labour threatened Britain’s economy.
The letter clarified that the 40 signees are not all Corbyn supporters – “but we hope to clarify just where the “extremism” lies in the current economic debate”.