Philip Pearson

Offering hope where the closure of the Vestas plant left despair, Energy and Climate Secretary Ed Miliband announced at Congress on Wednesday 16 September that the world’s biggest wind turbine blades will be made in Britain – with new Government support.

Presumably spending from Budgets the Tories would cut, he announced Government grants for three offshore wind energy companies. Newcastle-based Clipper wind gets £4.4 million to develop their first prototype 70m blade, the largest wind turbines in the world. Artemis Intelligent Power has £1 million to transfer their existing technology from automotive to wind energy. And Siemens Wind Power UK benefits from £1.1 million to develop the next generation power convertors for their larger offshore turbine.

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Richard Exell

Today’s labour market statistics show unemployment reaching 2.47 million – two and a half million next month seems inevitable, with the figure climbing about 35,000 each month.

Unemployment has now risen for 14 consecutive months. The figures for men and for 18 – 24 year olds have not fallen since December 2007, women’s unemployment is the highest it has been since April 1994.

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Nigel Stanley

Simon Jenkins has this in the Guardian today:

A good Keynesian would respond to a call for cuts by saying that, whatever we do, we should maintain demand. That means maintaining cash benefits to the old and poor, who spend rather than save. But that merely increases the need to find other ways to reverse the steep rise in public spending over the past decade.

No, no, no. A good Keynesian knows that public spending is a job-intensive way of maintaining demand. I know Adam has already done this,  but I prefer this Simon Jenkins:

What the economy needs is not rescued banks but raw spending power. It needs people to pour into shops and showrooms, estate agents and restaurants, hotels and DIY stores. Even were banks lending it would be no substitute for spending to recharge the economy. Only spending power, from the bottom up, will eventually refloat the banking system, not public subsidy. Government can do this by employing people on public projects and services.

Could they by any chance be related?

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Nigel Stanley

The TaxPayers’ Alliance seem to be changing their tune on pensions tax relief. When Alastair Darling announced that he was going to limit relief for those earning more than £150,000 a year, they weren’t very happy:

In one of the more mean-minded moves in his Budget, Alistair Darling has decided to claw back tax relief on pension contributions for higher-earners (those with an income over £150,000 pa) from 2011.

But now they seem to concede there is a problem, as they say that the “problem” of tax relief has been “addressed”  and “solved”.

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Adam Lent

The Taxpayers’ Alliance has accused me of being “frankly ridiculous” for my criticism of their four day week proposal for public sector workers.  Leaving aside the fact that this is a bit like being denounced as posh by the Tory front bench, I note that Matthew Sinclair hasn’t actually addressed my key point (made in more detail in a further post) that making cuts of this sort will only damage the economy and further drive up the deficit. 

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Tim Page

After a few days in which the Westminster Village and what used to be called Fleet Street have conspired to convince us that spending cuts is the only meaningful topic of political discussion, I am pleased that the OECD has brought us back to reality today.

The Organisation for Economic Co-operation and Development represents the 30 richest countries in the world. Politically, it is instinctively free market. It is, however, trade union and business friendly, in the sense that it has a common sense, social partnership approach to its work, so unions and employers can and do meet with it and seek to influence its policies.

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Adam Lent

Thanks to Duncan for pointing out in a typically learned post that today’s fall in gilt yields proves my point that bonds behave in complex ways.  This undermines Osborne’s simple-minded belief that bonds only respond to news on public debt.  More power to the “crazy people” (read Duncan’s blog for an explanation).

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Tim Page

In his latest post, Adam makes some very worthwhile observations about the damage of spending cuts to the economy. And in spite of positioning himself as perhaps the most enthusiastic exponent of cuts among today’s crop of politicians, they don’t seem to be doing George Osborne’s fortunes much good either.

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Adam Lent

Politics seems to be on a collision course with economics at the moment.  With the right-wing press screaming for cuts and the polls showing a majority of voters agreeing, the main parties are now positioning themselves as cutters.

This is not democracy at its best.  The arguments against any major and urgent cuts programme are extremely strong but they are now being crowded out by a debate that is shaped by the desire to win the political rather than the economic battles ahead.

I won’t go into too much detail but it seems to me there are three main arguments against cuts.

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• Top earners cost taxpayers £22bn in pension tax relief
  Nigel has a guest post up on Left Foot Forward about how tax relief on pensions works, and the case for introducing minimum tax rates.

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