Saturday, February 20, 2010

At last: British economists take an interest in the economy

We finally have a debate about economic policy in Britain. Unlike in the US, where academic economists maintain blogs and engage in lively, even too lively, debate about the policy responses to the crisis, British economists have remained strangely silent.

The silence has been broken by an exchange of open letters, one arguing the need for a early action on the deficit to establish credibility and reduce the costs of long-term debt service, the other insisting that growth is the priority, and that cuts in spending would risk plunging the economy back into recession.

Strangely enough, the two positions are only different in terms of presentation and emphasis. Neither suggests ignoring the deficit, neither suggests slashing spending to deal with it. In the end, this exchange remains, like the economics debate in the UK in general, fairly anaemic. Odd, if you consider what a mess we're in. Maybe we've all given up?