Economists ask: where is Osborne's Plan B?

Signatories of a letter to the <em>Observer</em> include several academics who backed the scheme las

A group of leading economists has called for George Osborne to change course on his deficit reduction strategy, saying that it is "stalling".

A letter to the Observer signed by 47 academics and economists said:

Recent economic figures have shown that the government urgently needs to adopt a Plan B for the economy. As economists and academics, we know the breakneck deficit-reduction plan, based largely on spending cuts, is self-defeating even on its own terms. It will probably not manage to close the deficit in the planned time frame and the government's strategy is likely to result in a lot more pain and a lot less gain.

We believe a more effective strategy for sustainable growth would be achieved:

- through a green new deal and a focus on targeted industrial policy.

- by clamping down on tax avoidance and evasion, as well as by raising taxes on those best able to pay

- through real financial reform, job creation, "unsqueezing" the incomes of the majority, the empowerment of workers and a better work-life balance.

These are the foundation of a real alternative and it is time the government adopted it.

Damagingly, several people have signed who were signatories of a letter to the Sunday Times last year which supported the Conservatives' approach. This indicates worry across the board about the slow rate of growth. Britain's economy grew by a sluggish 0.5 per cent in the first three months of this year but inflation rose by more than expected to 4.5 per cent.

The former chief economist at the Cabinet Office Jonathan Portes has also called for a change of course. Now director of the National Institute of Economic and Social Research, he said: "You do not gain credibility by sticking to a strategy that is not working." Sadly, Osborne does not appear to see it that way.

Samira Shackle is a freelance journalist, who tweets @samirashackle. She was formerly a staff writer for the New Statesman.

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This is no time for a coup against a successful Labour leader

Don't blame Jeremy Corbyn for the Labour Party's crisis.

"The people who are sovereign in our party are the members," said John McDonnell this morning. As the coup against Jeremy Corbyn gains pace, the Shadow Chancellor has been talking a lot of sense. "It is time for people to come together to work in the interest of the country," he told Peston on Sunday, while emphasising that people will quickly lose trust in politics altogether if this internal squabbling continues. 

The Tory party is in complete disarray. Just days ago, the first Tory leader in 23 years to win a majority for his party was forced to resign from Government after just over a year in charge. We have some form of caretaker Government. Those who led the Brexit campaign now have no idea what to do. 

It is disappointing that a handful of Labour parliamentarians have decided to join in with the disintegration of British politics.

The Labour Party had the opportunity to keep its head while all about it lost theirs. It could have positioned itself as a credible alternative to a broken Government and a Tory party in chaos. Instead we have been left with a pathetic attempt to overturn the democratic will of the membership. 

But this has been coming for some time. In my opinion it has very little to do with the ramifications of the referendum result. Jeremy Corbyn was asked to do two things throughout the campaign: first, get Labour voters to side with Remain, and second, get young people to do the same.

Nearly seven in ten Labour supporters backed Remain. Young voters supported Remain by a 4:1 margin. This is about much more than an allegedly half-hearted referendum performance.

The Parliamentary Labour Party has failed to come to terms with Jeremy Corbyn’s emphatic victory. In September of last year he was elected with 59.5 per cent of the vote, some 170,000 ahead of his closest rival. It is a fact worth repeating. If another Labour leadership election were to be called I would expect Jeremy Corbyn to win by a similar margin.

In the recent local elections Jeremy managed to increase Labour’s share of the national vote on the 2015 general election. They said he would lose every by-election. He has won them emphatically. Time and time again Jeremy has exceeded expectation while also having to deal with an embittered wing within his own party.

This is no time for a leadership coup. I am dumbfounded by the attempt to remove Jeremy. The only thing that will come out of this attempted coup is another leadership election that Jeremy will win. Those opposed to him will then find themselves back at square one. Such moves only hurt Labour’s electoral chances. Labour could be offering an ambitious plan to the country concerning our current relationship with Europe, if opponents of Jeremy Corbyn hadn't decided to drop a nuke on the party.

This is a crisis Jeremy should take no responsibility for. The "bitterites" will try and they will fail. Corbyn may face a crisis of confidence. But it's the handful of rebel Labour MPs that have forced the party into a crisis of existence.

Liam Young is a commentator for the IndependentNew Statesman, Mirror and others.