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Budgets are always exciting events in British politics (if you like that sort of thing). As well as setting the taxation and spending priorities for the year ahead, they are also political tests for the chancellor and government of the day. Does a budget hey make political capital and win favour with the right voters? Does it hold up to sustained scrutiny from the media and MPs? Or does it wither away after the first glance from the opposition?
The political stakes in Philip Hammond’s fiscal statement this week are pretty high, given the precarious state of the Conservative government. Especially so given that the Labour opposition, whose alternative economic strategy has become increasingly credible, will be arguing that its radical proposals are what voters want. John McDonnell, the shadow chancellor, argues in an opinion piece that the Conservative strategy has failed — particularly on taxation and investment — and it should U-turn in favour of something more akin to his thinking.
The difficultly for Mr McDonnell is that his economics are so far removed from Mr Hammond’s, they exist in different ecosystems. One is a bone-dry Thatcherite free marketer, the other a socialist in the tradition of Tony Benn. Whereas Mr Hammond wants to keep spending under tight control, Mr McDonnell wants to ramp up borrowing now to recoup it later. Although Labour will try to gain as much political capital from the Tory budget as possible, the fundamental disagreements are so great that there is no way the pair could agree on much.
For an alternative Conservative take on budget, see this opinion piece from the FT Weekend by Rupert Harrison, a former aide to George Osborne.
What you’ve been saying
More tiny hutches around the M25 won’t solve the crisis— letter from Felicity Hawksley:
“I’m a realist: while a good number of our lawmakers remain buy-to-let landlords and the majority remain homeowners — and while the power lies in the hands of homeowners I doubt this will change. But over time, the number of people shut out of the market will be greater than those allowed in. As parents live longer, home equity will go to fund care. Less will be inherited. And so the balance will tip. If nothing changes, those relying on home ownership as a sure thing will be in for a shock.”
Comment from Dr. Marcel DeBury on Zimbabwe: a ‘slow motion coup’:
“While not unique in Africa, Mugabe stands out in his shrewd hijacking of Zimbabwe’s “liberation movement” (and his former-hero status therein) to build himself a personality-cult and an immense illicit fortune centered around his sustained campaign of alienation & dis-possession of Zimbabwe’s White citizens and demonisation of imagined imperialist powers to divert his impoverished-people’s attention from his disastrous governance.”
Three stages of an immigrant’s assimilation— letter from Amit Raychaudhuri:
“In my 40-odd years of residence in the US, I have noticed a somewhat similar phenomenon in the Indian immigrant’s response and assimilation to his adoptive country in three discrete, if sometimes overlapping, phases. The first stage, usually lasting five to 10 years or longer, is characterised by uncritical, wholesale acceptance and boundless admiration for America and everything American accompanied by a commensurate distaste for India and rejection of all things Indian.”
US trade problems begin at home not abroad If the White House wants a fix, it should compare its mistakes with China’s strategy
After Brexit, the UK’s old-fashioned economy will lose its clout The great irony of leaving the EU is that Britain will be forced to be more European
China must reveal the true level of its GDP growth Plans to abandon long-term targets will show the real state of the country’s economy
Ignore the experts when you name your child I will never get back the hours I have spent spelling out Pilita — but I don’t care
FT View: Rescuing Zimbabwe from the legacy of Robert Mugabe International donors must use their new leverage to stop the mood from souring
FT View: The painful grind to a stronger eurozone A tighter banking union is more likely than fiscal centralisation
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