Today, we learned that Britain’s national debt is growing at a faster pace than any country in the world, except Botswana. Yet instead of taking control, Reeves wants to borrow and spend even more. She cadged £24.3billion in April alone and is set to tap the bond markets for a staggering £140billion in total this financial year. Soon, UK debt will smash through the £3trillion barrier. We’re on the edge of the abyss. Any sensible government would scramble to balance the books. Not this one. Labour refuses to stop spending.
Former IMF chief economist Ken Rogoff is urgently warning that unless Reeves gets a grip, Britain will go cap in hand to the International Monetary Fund all over again, just as Labour did in the 1970s. He said Britain faces a “more than 50-50 chance” of a debt crisis by 2030. The humiliation would be unbearable. Even the Bank of England is warning Reeves to change course. She won’t.
Governor Andrew Bailey has said Britain risks a “vicious cycle” of rising borrowing costs that could end in disaster. We already pay £100billion a year to service the interest on our debts. As the Iran war drives up inflation, that could climb dramatically.
If Burnham wins the Makerfield by-election on June 18, he’ll go hell for leather to replace Keir Starmer as PM. But then what? The King of the North only has one plan, and it’s the same one Rachel Reeves had. Borrow more, tax more and spend more, until the IMF steps in. It didn’t work for her, and it certainly won’t work for him. Because there’s no money left. There never is under Labour.
Britain can’t keep borrowing. The bond markets won’t allow it. And if Labour pushes taxes even higher, the IMF says growth could dry up altogether. The economy has already taken about as much fiscal punishment as it can stand. If Burnham can’t borrow and can’t tax more, then he can’t spend more either. And since that’s the only thing he wants to do, he won’t be able to do anything. He’ll be doomed even before he begins.
Of course, that’s his fault. He should have come up with a strategy, but hasn’t. But he won’t be happy at Reeves for spending all the money before he had a chance to spend it all himself. Burnham and Reeves will sink together, and it’ll serve them right. Unfortunately, these two financial incompetents will drag the rest of us down with them.
