We are still managing our way laboriously through one major financial crisis and its economic consequences, but many argue that a new one is about to erupt. They assert that the coming financial storm, caused by excessive government borrowing and the emergence of “big government”, will result in threats to the solvency of the state and/or much higher inflation. Others assert that the biggest mistake we could make would be to shut down prematurely the only effective weapon we have to manage the current crisis and combat market failure, namely the balance sheet of the state, including that of the central bank. Is there any way to determine who is right?

Robert Skidelsky’s cogent perspectives in the Financial Times last week (“Economists clash on shifting sands”, June 11) emphasised that this debate, between New Classical Economists and New Keynesians, does not lend itself to dogged assertion with bogus scientific credentials. In fact, economic thinking through the ages has continuously addressed the same topics, such as wealth creation and distribution, property ownership, and the role of markets and government, but it waxes and wanes with circumstance and the political context of the time. Today, you do not have to be a socialist to believe in the stabilising force of the state in the economy, and you do not have to be a proponent of laisser faire to fear the financial consequences of unrestrained big government. But you have to have perspective.