The Guardian view on Labour’s fiscal policy: mayhem, muddle, but the right call in the end | Editorial

George Osborne's fiscal charter is a silly game. John McDonnell is right to vote against it. But it's a shame he couldn't resist a little game-playing of his own before he made the decision

As ridiculous as John McDonnell's economic policy may appear in the wake of his about-turn on George Osborne's fiscal charter, and it certainly looks pretty shambolic, it is important to acknowledge just how ridiculous is the proposal that the shadow chancellor is wrestling with. Mr Osborne wishes to enshrine a wrong-headed symbol in statute, for no purpose beyond creating havoc on the Labour benches. He promises surpluses for ever using the law, but nobody will be going to jail when they don't arrive.

Even if the economy hummed to the point where the government was in the black, does anybody seriously imagine that Conservative MPs would sit passively for years on end when tax rates were higher than they needed to be? Does anybody dispute the arithmetic which demonstrates that a 2% GDP deficit will eventually result in a perfectly manageable public debt ratio of 40% GDP, just so long as nominal national income can be persuaded to grow at around 5% annually, as it generally did before Mr Osborne was in charge? Does anybody contest, either, that there are productivity-boosting investments which it is worth a government borrowing for, or indeed that the great lesson of the last few years is that it is important for the economic authorities to retain discretion to deal with nasty unknown unknowns?

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