William Nordhaus and Paul Romer honoured over two of most ‘basic and pressing’ issuesTwo American economists at the forefront of work on climate change and the role of governments in boosting growth have been jointly awarded the prestigious Nobel Memorial prize for economics.The Royal Swedish Academy of Sciences said William Nordhaus and Paul Romer were being honoured for their research into two of the most “basic and pressing” economic issues of the age.Related: Nobel prize in economics goes to Nordhaus and Romer for climate change and growth - live Continue reading...

More bosses rein in hiring and investment plans amid concerns of no deal – DeloitteBritish businesses are the most anxious they have been about Brexit since the 2016 referendum, with more bosses reining in hiring and investment plans, a study has found.The accountancy group Deloitte has warned that worries over the long-term impact of Brexit are mounting. This is pushing down optimism over future prospects as firms fear their trading relations with customers in the European Union could be disrupted next year.Related: Macron makes overtures to UK car firms as Brexit talks enter critical week Continue reading...

Findings about the impact of a course of heavy-duty cuts on life expectancy make grim readingThe quack doctors rolled into town just as the global economy had come off the critical list. It was 2009 and the message from the austerity medicine show was simple: the only way back to full health was a course of heavy-duty cuts.Expert opinion was divided. There were other diagnoses available. There were economists who said austerity was the equivalent of going back to the days of blood-letting – but they lost the argument. The prescription, though it varied a bit from country to country, was pretty much the same across the developed world: get those budget deficits down.Under Greece's bailout, health spending fell from 9.8% of GDP in 2008 to 8.1% in 2014 Continue reading...

In Bali this week, the mood of the world’s gathered finance ministers will be darker than a year agoThe alarms bells have already started to sound. And this week it is expected to be announced formally that the global economy is running out of steam.As finance ministers, central bankers, academics and other delegates prepare to travel to Bali for the annual meeting of the International Monetary Fund (IMF), optimism about the future is at a low ebb. Continue reading...

There is no exit model that improves economic growth, and this disastrous project has stopped us tackling real social illsI know that Theresa May is beleaguered on all sides – not least her own – but did she realise what she was saying when she “warned” the Conservative conference that divisions over Brexit “could stop the UK leaving entirely”?Since stopping the UK leaving entirely is just what we Remainers wish to achieve, one can but marvel at the prime minister’s pronouncement. I am tempted to add “long live the divisions”, but the truth is that the sooner this Brexit fantasy is put to rest, the better.To bring public services up to scratch, there needs to be a general increase in the willingness to cough up Continue reading...

Tory delegates breathed a sigh of relief at Theresa May’s conference speech, but the chancellor has a rather different attitude to the country’s purse stringsTory cheers during Theresa May’s conference speech when she declared the end of austerity were an audible cry for freedom. The party faithful who attended last week’s annual bash in Birmingham wanted to break the chains of spending cuts that could deny them victory whenever the next general election comes along.The pain inflicted on much of the population since 2010 has energised voters, prompting many of them to join the Labour party, which staged a dramatic resurgence in 2017 and denied the Tories an outright victory. Another election, especially against a backdrop of even more severe cuts, could spell the end of even that slim majority. Continue reading...

We have great plans to build a country with opportunities for allI want the Conservatives to be a party for the whole country. I believe that the principles that guide us – security for families and the country, freedom under the rule of law and opportunity for everyone – can unite our people and help build a better future for our country.That responsibility also rests on our shoulders because of what has happened to Labour over the past few years. Millions of people who have supported Labour all their lives are appalled by what has happened to a once-great party under the leadership of Jeremy Corbyn. Antisemitism has grown, the party’s response to threats to our country’s security has become equivocal, and moderate Labour MPs have become targets for deselection and harassment. These are all alien to Labour’s best traditions. Continue reading...

We’re told the world is turning middle class, but those at the bottom have little to cheerHalf the world is now middle class. So ran the headlines reporting a Brookings Institution analysis of global poverty, according to which 3.8 billion people can now be defined as “middle class” or “rich”. We have, Brookings suggested, reached a “global tipping point”.Economic development, in China and India in particular, has helped pull millions out of poverty, a shift reflected in these figures. What is striking about the report, though, is as much what it obscures as what it reveals. The four categories in the Brookings analysis are: poor, vulnerable, middle class and rich. Notice what’s missing? The working class. Continue reading...

Increase in non-farm payrolls of 134,000 in September is smaller than expectedUS figures have shown the lowest jobless rate since the year of the first moon landings, keeping the world’s largest economy on course for further interest rate rises.Eagerly awaited figures for jobs and wages showed less inflationary pressure in the world’s biggest economy than had been feared, but still pointed to more hikes by the Federal Reserve. Continue reading...

Asian shares fall again as countries that borrowed heavily in dollars could be hit by further US interest rate riseMounting concern about the inflationary impact of falling US unemployment has sent tremors through global financial markets amid fears that the long post-financial crisis rally in asset prices is nearing its end.The effective interest rate on 10-year benchmark US bonds reached their highest level for seven years after the latest snapshot of the American labour market showed fewer workers claiming jobless benefits.Related: Soaring US dollar threatens trouble for emerging markets Continue reading...

Fifth of UK men who left education at earliest stage are in vulnerable sectors, says IFSMale workers with few qualifications will be the hardest hit by fresh barriers to trade erected after Britain leaves the European Union, according to one of the UK’s leading thinktanks.The Institute for Fiscal Studies said men in manufacturing jobs who had left school with GCSE qualifications or below were the most exposed to curbs on the flow of goods after Brexit. Continue reading...

Readers react with some scepticism to the prime minister’s claims to the Tory conferenceSo “austerity is over” (Back me on Brexit and I will end decade of austerity, pledges May, 4 October). Who is Theresa May kidding? For millions of adults and children living at or below the poverty line because of the savage cuts of the past few years, for those on NHS waiting lists that daily grow longer, for those in substandard housing or who cannot even get on the housing ladder, it will be a permanent legacy of Tory government callousness and indifference to their plight, while rich donors and multinationals get away with tax dodging on a truly stupendous scale.My county council (like many others), having cut £145m over recent years, cutting services to the elderly, underfunding schools, closing waste tips for two days a week, failing with pothole repairs, is now having to look at another £145m of cuts over the next few years, as the government grant reduces to zero. Ceasing altogether to provide housing support to vulnerable groups, leading potentially to more homelessness and NHS demand, and slashing support to troubled children and families are just two of the cuts being considered, with inevitable consequences. Continue reading...

People are crying out for economic justice and cultural security. Whoever grasps this will control the immediate political futurePolitical parties are governed by ideology. That ideology works when it offers the best explanation of reality to the party’s activists, members and voters. But when reality shifts – when the experience of people is no longer legitimated or explained by the politics they are offered – then that party and that ideology are in mortal danger.At the close of this autumn’s party conference season, it is clear we are in the middle of a significant reframing of our political reality. The shift is probably equal to, if not greater than, the 1945 moment that founded welfare states across Europe or the Thatcher revolution in 1979, which began the dismantling of them in the name of free-market economics. Continue reading...

PM’s announcement doesn’t reflect current Treasury policy as departments still face cutsTheresa May announced an end to austerity in her Conservative party conference speech this week. However, the statement raised questions about how the Tories’ cornerstone economic policy can be unwound.Did Theresa May give a timeframe for ending austerity this week? Continue reading...

So easy to say, so difficult to do. May’s scant offerings will barely touch the damage that’s been wreaked on this countryPut out more flags! Ring the bells and light the beacons, the austerity war against the people is over! The prime minister said: “The British people need to know the end is in sight. And our message to them must be: we get it.”But “getting it” doesn’t mean doing it: announcing it may be all that matters. Consider how easily her promised £20bn a year for the NHS has taken the ongoing crisis in hospitals and GP surgeries off the front pages, without a penny spent and winter approaching. Paul Johnson of the Institute for Fiscal Studies said today that, on top of this, £20bn extra by the end of the parliament would only stop further cuts, with the funds consumed by rising numbers of older people. That’s a sobering thought – such a large sum just to stand still.Related: The Guardian view on Theresa May’s speech: getting by on borrowed time | EditorialRelated: Nissan becomes latest manufacturer to warn against hard Brexit Continue reading...

CEO says bank already more cautious about lending, especially in retail and construction sectorsThe chief executive of the bailed-out Royal Bank of Scotland has warned a no-deal Brexit could tip the UK into a recession.Ross McEwan said a “bad Brexit” could result in negative growth in Britain and that RBS had become more cautious about lending to some sectors, including retail.Retailers that have gone bust 2017-18 Continue reading...

Strong economy and hawkish monetary policy pushback greenback ever higher – and other currencies are sufferingThe US dollar continued to soar in value over Wednesday night, signalling the likelihood of more interest rate rises and spelling trouble for developing countries that have borrowed heavily in the greenback.With impressive service sector data published on Wednesday and strong jobs figures in the non-farm payrolls expected on Friday, the dollar hit an 11-month high against the yen and drove US treasury yields to their highest since mid-2011. The pound slipped below $1.30.Related: World economy at risk of another financial crash, says IMFRelated: Argentina, Turkey, Mexico ... fear of contagion haunts emerging markets Continue reading...

‘Flexible hours’ was draw for only 28% taking gig economy contracts, finds labour studyAlmost half of people on zero-hours contracts want more regular work and greater levels of job security, according to a study that challenges the idea that workers want such terms for the flexibility they offer.According to the report from three labour market economists, to be presented at an international conference in Austria this week, 44% of workers in a survey of 20,000 people on zero-hours contracts said they would like more working hours.Related: Deliveroo couriers win six-figure payout in employment rights case Continue reading...

PM makes several policy pledges in effort to show Brexit has not blown her off course

Economy minister Tria says Italy plans to cut budget deficit starting in 2020, earlier than previously said, after clash with EU

Debt is above 2008 level and failure to reform banking system could trigger crisisThe world economy is at risk of another financial meltdown, following the failure of governments and regulators to push through all the reforms needed to protect the system from reckless behaviour, the International Monetary Fund has warned.With global debt levels well above those at the time of the last crash in 2008, the risk remains that unregulated parts of the financial system could trigger a global panic, the Washington-based lender of last resort said.Related: Gordon Brown is wrong to say British banking is still a free-for-all | Alex Bailin Continue reading...

Giant’s minimum wage rise is down to a looming labour shortage and more stick from politicians, from Trump and Sanders to CorbynAmazon is a trillion-dollar company run by the world’s richest man. It has come from nowhere to be an online behemoth in less than one-quarter of a century. Yet even the biggest company, this behemoth of behemoths, is vulnerable to concerted political pressure and has to live with the basic laws of demand and supply.That, put simply, is the explanation for Amazon’s announcement of seriously big increases in minimum wages for its workers in the US and Britain. On the other side of the Atlantic, no worker will be earning less than $15 (£11.50) an hour – double the federal minimum. Here, the minimum has been raised by 28% for workers in London and 18% for those in the rest of the UK.Related: Jeff Bezos: where the $106bn man belongs on the all-time rich list Continue reading...

Loan for enclave still affected by bad debts from 2008 financial crisis equates to £7,500 per residentLeaders of the medieval enclave of San Marino are preparing to ask the International Monetary Fund for a €250m (£222m) loan to bolster its banks, still weighed down by bad debts 10 years after the global financial crisis.The microstate, which is landlocked within central Italy, has struggled to recover from the effects of the 2008 crisis, which not only exposed the secret bank accounts that helped to generate a hefty amount of its wealth over the years but also embroiled its largest bank – Cassa di Risparmio della Repubblica di San Marino (CRSM) – in a money-laundering scandal. Continue reading...

ONS pegs value of cooking, cleaning and childcare at £1.24tn – almost £19,000 per personUnpaid household work, such as looking after children, doing laundry and cooking, is worth £1.24tn per year – more than the value of the UK’s retail and manufacturing output combined, according to official figures.The Office for National Statistics (ONS) released data for 2015 and 2016 on Tuesday estimating the value of the unpaid work undertaken by households, which also included caring for adults at home and driving to work. It said the value had grown every year from 2005 to 2016. Continue reading...

Matteo Salvini claims Jean-Claude Juncker’s comments drove up Rome’s cost of borrowingThe Italian deputy prime minister, Matteo Salvini, has threatened to sue Jean-Claude Juncker for damages, accusing the EU president of pushing up Rome’s cost of borrowing by likening Italy to Greece.Salvini, who is also Italy’s interior minister and leader of the far-right League party, was speaking after Juncker’s comments helped send the yield on Italian benchmark bonds to a four-and-a-half year high of 3.4%, while shares in Italian banks plunged.Related: European markets fall after Italy's deficit-widening budget plansRelated: Pro-refugee Italian mayor arrested for 'aiding illegal migration' Continue reading...

Company says it has ‘listened to its critics’ as it increases US rate to $15 and UK to £9.50Amazon has raised its minimum wage for British and American workers, in a major milestone for campaigners pushing for pay increases to tackle rising levels of poverty and inequality.The company, which has become almost a byword for low-paid and low-quality work in recent years, said it would increase its US minimum wage to $15 (£11.57) an hour for more than 350,000 workers. In the UK 40,000 permanent and temporary staff will get an increase to £10.50 an hour in London and £9.50 across the rest of the country. Continue reading...

Tory policies have concentrated power and wealth in a few hands. No wonder the party’s supporters now look to LabourBelieve the pundits, and the remedy for the Conservatives is simple. They need a new leader. Some new faces around the cabinet table.Some flashy new policies. And, everyone agrees, they need to stop flicking V-signs at business. But nothing too radical. An oil change, a spray job, and they’ll be motoring again.Political wisdom is often little more than sonorous simple-mindedness, and this is a prime example. Judging by Philip Hammond’s speech to the Tory faithful on Monday, the chancellor doesn’t buy it, either. Humming through his lines was an anxiety about the threat posed by Jeremy Corbyn. Whatever their press releases say, cabinet ministers are stumbling through the Tory conference in Birmingham worried that Labour’s arguments about Britain’s broken economy are hitting home. And with good reason.Related: Welfare spending for UK's poorest shrinks by £37bnRelated: Is Theresa May’s plan for a festival of Brexit just an appalling sop to the DUP? | Andrew Adonis Continue reading...

11th-hour agreement ends months of dispute between the US and its closest neighboursThe US, Canada and Mexico have reached a deal to revamp the North American Free Trade Agreement (Nafta), ending months of bitter dispute between the world’s largest economy and its closest neighbours.Donald Trump declared the United States-Mexico-Canada Agreement (USMCA) – the new name for the world’s second-biggest economic bloc behind the European Union – a “wonderful new trade deal”, which came through an 11th-hour agreement late on Sunday.Related: Markets rally as Trump hails 'biggest ever' trade deal with Canada and Mexico - as it happenedRelated: Trump professes love for Kim and hate for Kavanaugh torment in freewheeling speech Continue reading...

Keith Flett, Derrick Joad and Stan Zetie reflect on what Brexit could mean for the left. Plus George Osborn says the video games industry expressed its concerns about BrexitLarry Elliott highlights the minority case on the left for leaving the EU (The left case for leave is gaining strength as it becomes clear that this Europe is not for turning, 1 October). It is one I agree with in principle. The EU is a neoliberal institution, and while it may be possible to reform it, this seems to have dropped off the agenda of those on the left who argue for remaining in the EU. It would be highly likely to prove a serious obstacle to any progressive advance in the UK.That said, I voted remain because there is also a tactical argument to be had about when would be a good time to leave. At the moment we are most likely to be heading for a rightwing Brexit, stirring up racism and attacks on the conditions of those at work. It is true that the crisis in rightwing politics this is causing – witness this week’s Tory conference – could bring a general election and a victory for the left. If so, those who backed “lexit” – a leftwing exit from the EU – will be shown to have had a strong, if little heard, case.

Conservatives need to show themselves ‘worthy of the privilege’ of governing post-Brexit Britain, chancellor saysThe government’s growing concern at the challenge posed by Labour has been highlighted by Philip Hammond as the chancellor admitted that Jeremy Corbyn was asking questions the Conservatives needed to answer.Hammond joined other cabinet colleagues in warning that Labour’s policies would endanger the economy but said his own party needed to show itself “worthy of the privilege of governing post-Brexit Britain”.Related: Conservative conference: Hammond pledges digital services tax on web giants - Politics live Continue reading...

Christine Lagarde drops hint that fund will cut global growth forecast next weekThe head of the International Monetary Fund has sounded the alarm over the global economy, warning of an economic slowdown triggered by rising trade protectionism and soaring levels of debt.Christine Lagarde used a speech in Washington on Monday to drop the broadest possible hint that the IMF would cut its global growth forecast when it unveils its latest health check on the world economy next week.Related: How the IMF can manage the global economy better Continue reading...

Number of employees at large firms fell for second successive month in SeptemberBritain’s biggest manufacturers are cutting jobs and becoming increasingly reluctant to hire amid growing uncertainty over Brexit, according to a survey.The report from the IHS Markit and Chartered Institute of Procurement and Supply purchasing managers’ index found the number of employees working at large firms fell for a second successive month in September. Continue reading...

As a wealthy, warm country, the US would benefit from implementing a carbon tax to slow global warming

Only one-third of companies expecting to increase their investments, says reportBritish manufacturers are pulling back sharply on investment plans due to mounting uncertainty over Brexit and growing fears of a global trade war, a report has warned.Just one-third of companies said they planned to increase their investment in plant and machinery – a record low in the fifth annual survey carried out by the EEF manufacturers’ body and Santander Bank. Investment by small companies was particularly squeezed, with three-quarters saying they were having to mothball spending plans in the coming two years. Continue reading...

It’s easy to see why Corbyn and McDonnell are reluctant to put a remain option on a new ballotPolitics was once a simple affair. On one side were the lefties, unhappy with the status quo and agitating for something different. On the other side were the conservatives, suspicious of change. When it comes to Brexit, though, the natural order of things has been reversed. The right has come up with all sorts of visions – most of them dystopian – of Britain’s future outside the European Union. The left, for the most part, has spent its time praying for the vote in June 2016 to be reversed.It’s a bit more complicated than that. There are those on the left who understand that there was a reason people who had never voted before came out in their millions to vote for leave, and who say that something must be done for communities hollowed out by the failed policies of the past four decades. They even have a soundbite: tough on Brexit, tough on the causes of Brexit.The Left Case Against the EU by Costas Lapavitsas; PolityThe Left Case for Brexit by Philip Whyman; Civitas Continue reading...

Institution must strengthen its credibility as a responsive and effective leader – and listen to its membersImagine a world in which the annual meetings of the International Monetary Fund were more client-driven. Ahead of the gathering – this year’s will take place in Indonesia in October – the IMF would solicit from its 189 member countries three key policy issues on which to focus, not only in official discussions but also in the numerous seminars that are held in parallel. The result would be an agenda that responded better to the continued anxiety that a growing number of policymakers – and populations – are feeling.For much of the decade since the global financial crisis erupted, countries worldwide have been subject to what London Business School’s Hélène Rey and others have called “the global factor”: a set of external influences that countries cannot manage or control but that play an important role in determining key domestic variables. This has generated economic and financial volatility that has complicated internal policy management, fuelled political polarisation, and exacerbated social divisions.Related: Are US stock market highs justified, or is there a bubble? | Robert ShillerThe IMF should assume a larger role in providing analysis and lead more effectively discussion in pivotal areas Continue reading...

A brave chancellor would ditch his fiscal rules next month and spend on welfare and schoolsAs Philip Hammond puts the finishing touches to his conference speech he may want to consider a total rewrite. Boring Phil needs to talk to the nation, not his party. It is time for the most senior one-nation Tory (Theresa May is a pretender to this crown) to be a bit more statesmanlike and think about people beyond the audience.That doesn’t look likely though. His announcement last week of an autumn budget (on 29 October), suggested he plans to stick to offering a “balanced approach” to debt “while supporting vital public services, and building a stronger, more prosperous economy”.Inaction would be the coward's way out. It would be much more statesmanlike to ditch his fiscal rules Continue reading...

It was billed as the finest such centre in Europe, but Salford’s once-buzzing ‘precinct’ is now home to charity shops, pawnbrokers and a few tenacious independent tradersA visit to the constituency of Rebecca Long-Bailey, the shadow business secretary, shows that Salford is one of those places around Britain where the high street is suffering the “slow and agonising death” she referred to in her conference speech.A couple of miles from Manchester city centre, a concrete high-rise looms over what is known locally as the “precinct”. A daubed red arrow points to “Salford Shopping City”, a 1960s-built complex that is home to a particularly depressing collection of charity shops, pawnshops and payday lenders.Related: Can Labour’s five-point plan rescue Britain’s high streets? Continue reading...

Proposals for 2019 put the country on a potential collision course with the EUFears that Italy is on a collision course with the EU over its spending plans triggered sharp falls in European markets after the new government in Rome unveiled a deficit-widening budget.The coalition of the Five Star Movement and the League announced 2019 budget plans late on Thursday that would push the deficit – the gap between income from taxes and expenditure – to three times the size of the spending gap under the previous administration.Related: Italy's budget drama – all you need to know Continue reading...

Readers offer their views on how to make the economy work for everyone as Aditya Chakrabortty’s Alternatives column comes to a closeThe close of Aditya Chakrabortty’s Alternatives column (26 September) is an opportunity to spread alternatives for economic justice and sustainability across the mainstream of the Guardian. The business environment we trade in tends to assume that companies are investor-owned, and operating against that default incurs cost and risk. It takes confidence, even courage, to grow alternatives. Similarly, media reporting on alternatives takes effort, reaching outside of the bubble of the stock market ticker tape and corporate PR.One example, the community shares model for co-ops, with over 100,000 member investors, has been a game-changer. Community energy, village shops, community-owned pubs and new online platform co-ops are reinventing capital markets on a local, human scale. The same is true for every other part of the economy, from housing and work to trade and innovation. In each case, there are extraordinary stories of people coming together, stories of setbacks and scandals of the neglect of communities by powerful institutions. Continue reading...

All polyamory participants talk as if they are living in a social vacuum, unaffected by the wider social order, writes Sydney PeirisIn your article (‘There’s so much joy in being poly’, G2, 25 September) one person declares: “What I love about polyamory is that I’m my own person and no one owns me. I don’t own any of you, either. We’re all free.” It seems to me this represents the vision of the human in capitalist culture: the unfettered, autonomous, rational, economic man. All polyamory participants talk about their feelings as if they are living in a social vacuum, unaffected by the wider social order in which they live. Kathleen Lynch, the Irish educationist, argues that our education system too enshrines the rational autonomous subject. Instead she advocates education for nurturing affective relationships and the recognition that we are profoundly dependent and interdependent on others for much of life. Relationships, whether monogamy or poly, are vitiated by the values currently celebrated in capitalist culture: narcissism and hedonism.

The eurozone’s third biggest economy is heading for a clash with Brussels over deficit planThe financial markets are het up about events in Rome for three reasons. First, Italy is the third biggest economy in the eurozone after Germany and France. Second, its banking system is fragile after two decades in which the economy has posted precious little growth. And third, it has a new populist government – a coalition of the League and the Five Star Movement – with a radical agenda that includes raising pensions and introducing a basic income.Related: Italy agrees high public spending reforms in potential clash with EU Continue reading...

Quarterly spending fall of 0.7% is fourth dip in a row, leading to fears of reduced growthUK companies cut their investments in Britain in the second quarter of 2018 amid mounting uncertainty over Brexit, marking the fourth consecutive quarter of weak spending by firms, according to government figures.The Office for National Statistics said spending on projects and assets including transport equipment, machinery, buildings and intellectual property fell by 0.7% over the three months to the end of June to £47.5bn. Continue reading...

Wanted: 75 youngsters from all walks of life to freshen up economic advice – must have grade 6 GCSE mathsWhitehall is preparing to hire its first intake of apprentice economists to boost diversity at the heart of government, shaking up a profession often accused of failing to spot the financial crisis coming a decade ago.An Oxbridge-educated maths genius might be the stereotypical candidate for a role advising ministers on economics in Whitehall, but the civil service wants to find 75 young people from all walks of life to take the positions instead.Related: Who gets on to the civil service fast stream?Related: The civil service has known of its gender pay gap for years. So what’s changed? | Jane Dudman Continue reading...

While local council budgets plummet, centralised government gains ever more powerTake back control. After two bloodstained years in British politics, it remains the one Brexit slogan with a modicum of potency. It drips with self-righteous empowerment. It depicts remainers as shiftily in thrall to Brussels, while shielding Brexiters from the charge of mere xenophobia. It is also utterly cynical.In a recent series of interviews for this paper, John Harris travelled the country, going “anywhere but Westminster”. It showed yet again that the poor are always with us, a familiar tale of those “left behind”, their misery aggravated by austerity. Theirs is a local Britain savaged over the past decade by massive cuts in spending on services.Related: In Corby, life without local services is set to become a grim realityRelated: Yes, there is an alternative. These people have shown how to ‘take back control’ | Aditya Chakrabortty Continue reading...

Debt-saddled coalition government sets 2019 budget deficit at 2.4% of GDPThe Italian government agreed to a 2019 budget deficit target at 2.4% of GDP on Thursday night in a move that was celebrated by leaders but could bring the heavily indebted country into conflict with the European Union.The economy minister Giovanni Tria succumbed to pressure from the government’s two deputy prime ministers – Luigi Di Maio, the leader of the anti-establishment Five Star Movement (M5S), and Matteo Salvini, who heads up the far-right League – to increase the target in order to pay for election campaign promises such as a universal basic income, flat tax and pension reforms.Related: Markets digest Fed rate hike as Argentina gets $57bn IMF bailout - business live Continue reading...

Readers reflect on policies laid out by the leader of the opposition and the shadow chancellor John McDonnell at the party’s conference in LiverpoolI am no fan of Jeremy Corbyn. He has been an ineffective leader of the opposition in parliament, failing to take advantage of a hopelessly inept PM and many political open goals. However, I am fed up with the grudging critique of many of your commentators.Martin Kettle asserts that “Labour has now been radically transformed into a party in the leader’s own far-left political image” (Can Labour solve the Brexit question? Now it’s imaginable, 27 September). What Corbyn’s Labour is proposing would have been seen as mainstream social democracy in the 1960s and 70s: a refashioning of a mixed economy of public and private ownership which is still in existence in parts of Europe. Continue reading...

My father, David Coates, who has died aged 71, was a political economist, incisive critic of capitalism, and author.He was also a politics lecturer, professor of government and, from 1999, Worrell professor of Anglo-American studies at Wake Forest University, North Carolina. His academic work ranged widely: from the British labour movement and social change in postwar Britain to the possibilities of “third way” leftwing politics. Continue reading...

Investors take stock after mixed messages from the US Federal Reserve, as Argentina secures the biggest ever loan in the history of the International Monetary Fund

Two former members of Bank of England’s rate-setting committee give views on UK growth