The Guardian view on George Osborne’s new economic strategy: it needs to be made explicit and debated | Editorial
George Osborne's visit to China this week is an event of genuine significance. But what is principally significant is not the sight of a chancellor of the exchequer auditioning for the post of prime minister, interesting though that is. What matters much more is that Mr Osborne seems to be using the visit to set out - though without quite admitting it - the essential economic statecraft strategy of the current Conservative government. That strategy, given added immediacy by the higher-than-expected borrowing figures announced today, is to make Britain increasingly dependent upon inward investment by rich, often authoritarian, nations in order to help finance UK economic growth while maintaining a low-tax regime at home.
There are broad echoes of the Gordon Brown era in this. Mr Brown had to face the conundrum of how to supply the Scandinavian levels of public spending the public would like to see while maintaining the American levels of taxation that the public appears willing to pay. His stealthy strategy was to give the UK financial sector its head in return for taxation which he would direct into extra spending on the NHS, the working poor and the elderly. It was a more socially ambitious plan than anything Mr Osborne has admitted to, but both men took as read the political unpopularity that would follow the use of higher direct taxation to finance public goods. Like Mr Osborne, Mr Brown never quite levelled with the public about what he was doing. The strategy was never put to the electorate in a general election. As now, the strategy only became apparent in retrospect, through the chancellor's actions.
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