Truss’s Economic Plan Isn’t the Disaster Everyone Says It Is
The debate over the UK’s budget proposal could use fewer adjectives and more numbers.
Her economic plan is no reason to panic.
Photographer: ADRIAN DENNIS/AFPI know an unpopular economic policy when I see one. And the consensus among economists about the tax cuts and deregulations announced last week by UK Prime Minister Liz Truss is almost universally negative. Larry Summers noted: “I think Britain will be remembered for having pursued the worst macroeconomic policies of any major country in a long time.” Willem Buiter described it as “totally, totally nuts.” Paul Krugman is skeptical. As Jason Furman summed it up: “I’ve rarely seen an economic policy that is as uniformly panned by economic experts and financial markets.”
The contrarian in me rebels against such harsh assessments — even as I remain unconvinced that Truss’s plan will materially boost the rate of economic growth in the UK. Allow me to explain why I am not in a state of panic.