The final table at the 2009 World Series of Poker. Photo: Getty Images
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Las Vegas: the last honest place on earth

Poker is pure social Darwinism – a revelation of character as well as capacity. And where better to play it than Las Vegas, a city that is brutally upfront about its desire to separate you from your money?

I once knew a girl who had grown up in a small town on the North Island of New Zealand. The town was populated by descendants of Scottish Protestants, who had established a place of sober, hard-working respectability. On Friday and Saturday nights, the young people would go to a barn outside the town limits, where there would be music and dancing and the young men would get drunk and fight each other. None of this spilled over back into the town: no one would say anything about the bruises on the butcher boy’s face; and if a couple had found an intimacy at a dance, that wouldn’t alter the formality of their relations during the rest of the week.

This is how Protestant countries work. Civic spaces are designed for polite, hard-working respectability, and young people let off steam and the sinners do their sinning in self-contained places outside town limits. The US is a very Protestant country, and Las Vegas is its barn.
Actually it’s two barns, a couple of miles away from each other. The original one, Fremont Street, Downtown, is a ramshackle place. Apart from the slickly remodelled Golden Nugget, the one-time Glitter Gulch is a couple of shabby blocks of casinos and bars and souvenir shops covered by a canopy and blasted at night with music and air-conditioning and lights (“The Fabulous Fremont Street Experience!”), surrounded by slums and bail bondsmen storefronts. The other, the Strip, is the gaudy place of postcards and movies and the “Welcome to Las Vegas” sign, where high-rise casino-resorts stretch out along Las Vegas Boulevard.
 
It all began with a 1930s gambling roadhouse. The Club Pair-O-Dice was built up in the 1940s and 1950s with oil and Mafia money, and properly established itself after the Cuban Revolution of 1959 shut down America’s playground. The mountains behind, and the intolerable heat, remind any summer visitor who is foolish enough to stray too far from air-conditioning that this is a place in the middle of the desert without any reason to be, except for cupidity, profit, pleasure and need.
 
In July, I’d driven in from LA in the company of two old friends. We followed Interstate 15 through the Mojave Desert shimmer of heat, truck stops and Joshua trees and the occasional sun-blasted forsaken town. Both of my companions are Londoners who have been living in Los Angeles for about 15 years. One has made it big in Hollywood as a writer and producer of network television shows. The other is a professor of the history of science at California State University.
 
The Money and I had planned this trip some months ago. The Professor had joined us at short notice, leaving his wife and two small children behind. The Professor’s wife had been unresisting, maybe even encouraging. Because this is America, it is understood that men need to get together, to drive through the desert, that men need to drink cocktails and argue about politics in the Bellagio bar. But I wasn’t here to let off steam. I’d come to Vegas for a meeting of the board of the UK Poker Federation, and to take part in the World Series of Poker (WSOP).
 
The WSOP began in 1970 as a publicity stunt, as so many things in Vegas do. The Downtown casino owner Benny Binion invited the six best players in the world – most of them Texan – to compete against each other in cash games in several variants of poker, after which they voted on who had played the best. Most voted for themselves but after the second-place votes were tallied, Johnny Moss was declared the champion. The following year, seven players returned for a freeze-out tournament, in which players put up $5,000, received the same number of chips and the player who had all the chips at the end was the winner. This was again Johnny Moss.
 
The game that was played was Texas Hold ’em (“the Cadillac of poker games”). Each player is dealt two hole cards, followed by a round 
of betting, after which the “flop” of three communal cards is dealt, followed by a fourth card, the “turn”, and then the final communal card, the “river”, with a round of betting after the reveal of each communal card. The player makes the best five-card hand available out of any combination of his or her hidden hole cards and the five communal cards of the “board”. It’s a game of discipline and nerve and courage, which has become by far the most commonly played variant of poker. As the cliché goes, the tournament version is “hours and hours of boredom punctuated by moments of sheer terror”.
 
In the World Series of 1972, eight players took part, this time putting up $10,000 as the entry fee. The winner was “Amarillo Slim” Preston, who had a genius for self-publicity that exceeded even Benny Binion’s; and with this, the Main Event, the Big One, took off in the American imagination.
The modern era of poker began in 2003 when the appropriately named Chris Moneymaker, an accountant from Tennessee, qualified for the Main Event on the internet site PokerStars for a $39 investment and beat 838 other competitors for the first prize of $2.5m. When I first played the Main Event, in 2006, there were 8,773 entrants, many thousands of whom were online qualifiers.
 
The lobbies and bars and streets of Vegas were filled with tribes of online players wearing their website-branded caps and T-shirts and hoodies. (We’re now in the postmodern era, ever since the US government, in one of its typical reflexes of puritanism and economic protectionism, shut down online poker in America in April last year.)
 
The WSOP events are no longer at Binion’s Horseshoe Casino. The casino chain Harrah’s (now Caesars Entertainment) bought the Horseshoe in 2004 just for the World Series brand and moved the event from Fremont Street to just off the Strip, in the Rio Casino’s convention centre. This was all part of Downtown’s dwindling. There is no economic or legal connection between the city of Las Vegas and the Strip, which is incorporated into Clark County rather than the city. Strip casinos are superbly well-engineered machines for separating people from their money. None of those proceeds goes to the city.
 
Five years ago, Las Vegas was the fastest-growing city in the United States, with an unemployment rate of 4.7 per cent. The unemployment rate now is above 12 per cent. The crime rate is high, and getting higher. This year, the projected figures are for 130 killings and 16,500 cases of violent crime, which is two and a half times the national average.
 
The biggest police anti-crime initiative that I saw when I was there in July was the clampdown on pedlars selling bottles of drinking water without a licence. They are a common street sight, almost as common as the Mexican families flicking cards advertising erotic services on Las Vegas Boulevard, and the tourists traipsing along the Strip in the desert heat are grateful. But as the Las Vegas Review-Journal reported of one family group that had been warned off by a security guard outside Planet Hollywood, “Dolores Smith, 20, acknowledges that the water she and her cousins are selling for $1 is un-fair to licensed businesses that overcharge.” This is an interesting and very Vegas usage of the word “unfair”.
 
The journalist Marc Cooper published a very good book about the city nearly ten years ago that was called The Last Honest Place in America. Its thesis was that Las Vegas is brutal but self-evident: it’s all about money. Anyone can wander into the high-end casino-resorts, and people do, streams and streams of them, looking for bars and nightclubs and adrenalin adventure, drinking luminous cocktails from giant glasses, girls in tiny skirts and high heels, boys trying to act like high rollers, the prostitutes waiting in the casino bars, with the looks they send out that manage to be both candid and modest, You’re a discerning and attractive gentleman. You and I maybe could . . . ? and the disabled people rolling slowly through the aisles between slot machines in wheelchairs and mobility scooters – because, as the recession deepens, the proportion of disabled people in Vegas has risen noticeably: Mammon has finally found its Lourdes. And, if you’ve got a dollar in your pocket, you’re entitled to play. But Cooper’s book was published when Vegas was indisputably the gambling capital of the world. It’s lost some of its swagger recently. It has become more expensive. Profits from the casinos of Macau now exceed those of Las Vegas, which need to protect their income stream from the likes of Dolores Smith.
Nonetheless, I still love Vegas, its calculated gaudiness, its relentlessness, the haven it has made for smokers and gamblers and pleasure-seekers. In other contexts, I might find it decadent rather than magnificent that a resort in the desert has more championship golf courses than anywhere else in the world. The water comes from the Hoover Dam and, I’m sure, is also diverted from helplessly thirsty towns in southern California. As the journalist and president of the International Federation of Poker, Anthony Holden, says, “I love its nerve and its boldness and that every year something new happens.”
 
The conversations with cab drivers here are better than any you’ll find anywhere else, such as when the ex-marine explained to me the difference between gay and straight couples travelling in the back of his cab: “They want to give each other blow jobs? The straight couples ask you first. The gays just do it.”
 
And I love that you can play poker here all of the time, with many hundreds of games to choose from at any moment in the day. Every cash table, it seems, has at least one of the following: a cocky young man wearing enormous headphones, an implacable white-haired gentleman, an American Oriental who’s a dangerous opponent and a ferocious old lady with dyed red hair who bets aggressively, and whose ancient hands are covered with heavy jewellery and raised veins.
 
This is what I was here to do. In a fog of jet lag, I set about trying to raise my stake for the Main Event. I spent my days and nights in Vegas, as the Money and the Professor sampled cocktails and swimming pools and Vegas steaks, playing poker tournaments.
The Money, who has a slightly inflated opinion of my poker capacities because I managed to make it into the prize money in the 2007 Main Event, backed me in a couple of smaller WSOP tournaments. Staking arrangements are common in poker, with the player, as the phrase goes, selling off pieces of him or herself.
 
I had a meal with the Money and the Professor after I was knocked out of my first WSOP tournament this year after about six hours of play. Glumly, I apologised for the failure of his $1,500 investment and reported back on my exit hand (ace-ten, both diamonds, on an ace-king-jack flop with two diamonds: the subsequent two cards didn’t bring me my flush or my straight and I had to make the long walk out 
of the tournament room). We were eating at a very fancy steak joint at the Bellagio where, somewhat giddy with the food and the wine and Vegas, the Money ordered the best grappa in the house to finish off the meal. The waiter mildly observed, “That’s a dangerous thing to say in a place like this,” and fetched the order. 
 
I never did see the bill. They wished me luck on getting to the Main Event. All the top poker players in the world play the Main Event. Even some of the worst do, along with many visiting celebrities. Shane Warne and Teddy Sheringham play the Main Event. Even Jason Alexander (“George” from Seinfeld) plays the Main Event. I was having trouble accommodating myself to the likelihood that I might not be part of it.
 
Several days later, I was back at the Rio playing WSOP event number 59, a $1,000 buy-in. After the first 20 minutes or so, I was, as they say, in the zone. I knew where I was in pots; I knew which players I could bluff, which would find it unable to steer away from confrontations. It was clear who the good players at the table were and, therefore, which other players I needed to target, whose chips were up for grabs. I felt like I’d done five years before, the last time I’d played the Main Event, when I was at the top of my game and my form – when I proved, at least to myself, that I could function, even thrive, at this level and in this company.
 
Poker is a revelation of character, as well as capacity. As Al Alvarez reminds us, it is “social Darwinism in its purest, most brutal form: the weak go under and the fittest survive through calculation, insight, self-control, deception, plus an unwavering determination never to give a sucker an even break”. I was feeling so in control that I even had space in my heart to feel sorry for the gentleman at the other end of the table.
 
He was thickset with a kindly face and a white goatee that matched the colour of his dapper little cap. He was shaking, unmanned by nerves. 
I never found out how he had ended up in this tournament; maybe he was a wealthy tourist who had entered it on a whim, but he had neither the stomach for it nor the skill. Any time he forced himself to play a hand, the agony of the event was written on his face and body. He gave his chips away, some to me, some to the clever, taciturn Australian on my right, and when he had lost them all, when his tournament life was over, the relief of it returned him to some kind of version of himself.
 
There were over 4,500 entrants to this event. It would last for four days, with a first prize of $654,000. I wasn’t dreaming of this yet, nor even really of surviving long enough to get past 90 per cent of the field and into the money. At this stage the plan was to accumulate chips, with the thought of having enough to put me in some kind of decent position going into day two. I felt confident; I was on top of things.
 
And then my composure failed me. A new player arrived at our table, a glowering young man wearing enormous headphones and a baseball cap who sat down with towers of chips in front of him. I raised in middle position with pocket tens. He reraised in the dealer position. The flop came down jack high. I checked, he bet, I raised, and he reraised, putting me all in for the rest of my chips. I looked at him. He glowered back at me. I had put him on ace-king. Possibly he had a big pocket pair, higher than my tens. He might have had ace-jack. Or, he was playing position. The later you act in a betting round, the stronger your hand becomes. When you’re the last to act, you have leverage. If you have mountains of chips, you have greater leverage. 
 
I suspected I was winning. I asked for time. My instincts told me to call. I folded.
 
Poker is perhaps unique in that you are betting on an event that has already happened: the deck of cards has been shuffled and dealt; as more cards are revealed, more information is available. In playing a game of incomplete information, part of the agony is when you never find out the answer to the question that has been posed. I suspected that I had the better hand against the heavy-set aggressive kid, but I would never know. Even if I were to have asked him, dragged him out from under his headphones, he would probably have lied. Crucially, poker is also a test of the processing power of the brain and the emotional discipline of the player in response to new information and fresh stimuli. I was still beating myself up over the previous hand when I overplayed the subsequent one, committed all my chips in a toing and froing of action with the Aussie; and when it was over, I had two pairs, he had three jacks and I was out of the tournament. I had felt where I was, I had known where I was, but I was still off-balance from the earlier skirmish, and committed a kind of suicide. It takes only a moment to switch from being on top of things to taking the shameful walk away to the exit door. It happens all the time. I didn’t like that it was happening to me.
 
The day before, while I was playing a tour­nament at Caesars Palace, television screens were showing the final table of the Big One for One Drop. This was the inaugural run of a dizzying, $1m buy-in tournament, the winner receiving over $18m, by far the richest prize in sport, with 11 per cent of the entry money, suitably for Vegas, going to a water charity, the One Drop Foundation. (This year’s Main Event will have a first prize of “only” $8.5m.) The Big One was set up by the founder of Cirque du Soleil, Guy Laliberté, who is a high-stakes cash player as well as a circus magnate. The 2012 Main Event had 6,598 runners, of whom I was not going to be one. With its entry fee still at the 1972 level of $10,000, it’s no longer known as the Big One. Laliberté’s event had 48 entrants, including Laliberté. It was rumoured that he had paid the buy-in for 15 other players. Nonetheless, the event attracted, or enticed, all the best players in the world, along with a few deep-pocketed businessmen. It is probably the closest poker now comes to a true world championship.
 
The British player Sam Trickett came second (with over $10m to console him) to the American Antonio Esfandiari, but he deserved to win. Fearless, poised, always aggressive, always putting the question to his opponents (and we should remember here the origin of the phrase “putting the question”, which was a euphem­ism for interrogation under torture), he played poker of the very highest standard, under extreme emotional duress, for 12-hour days. He made audacious bluffs (some got through, others didn’t), he lost chips, he gathered them again. I lost my composure in under eight hours; he maintained his throughout three days.
 
I can point to the luck that let me down in the various tournaments I played in Vegas. In my exit hand from the $1,500 event, I was only a slight underdog on the flop (approximately 44 per cent to 56 per cent). In one $240 event at Caesars Palace, when we were getting close to the money (with a first prize of $61,000), I was all in, committing all my chips before the flop, with ace-king of spades against my outplayed opponent’s king-nine of clubs. The chances of my winning the hand were slightly more than 72 per cent. My opponent made his flush on the flop.
 
But all poker players, at whatever level, are used to bad beat stories. Like dreams, the only reason you put up with other people telling you theirs is that it then gives you the right to bore them with yours.
 
One of the effects of all this is to remind me how tough it is to be a poker player. Not just the world-class types like Trickett, but any of the ones who can call themselves professionals. In my week in Vegas, I played five tournaments, with entry fees of $1,500, $1,000, $350, $240, and $200. My prize winnings were $732, of which I donated $20 for dealer tips. Add to the buy-in costs the expenses of living and travel that the pros need to find. And the runs of bad luck that they have to deal with. In the poker world, it’s called “variance”. I tried to explain this to the Money before the grappa finished us off. His intelligently Vegas response was to reach into his pocket for his billfold. As Jason Alexander tweeted after his Main Event elimination: “The poker agony is over. Going home. But thrilled for the chance. Next year!” 
 
David Flusfeder is the author of “A Film by Spencer Ludwig” (Fourth Estate, £11.99)

This article first appeared in the 20 August 2012 issue of the New Statesman, Back To Reality

MILES COLE
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The new Brexit economics

George Osborne’s austerity plan – now abandoned by the Tories – was the most costly macroeconomic policy mistake since the 1930s.

George Osborne is no longer chancellor, sacked by the post-Brexit Prime Minister, Theresa May. Philip Hammond, the new Chancellor, has yet to announce detailed plans but he has indicated that the real economy rather than the deficit is his priority. The senior Conservatives Sajid Javid and Stephen Crabb have advocated substantial increases in public-sector infrastructure investment, noting how cheap it is for the government to borrow. The argument that Osborne and the Conservatives had been making since 2010 – that the priority for macroeconomic policy had to be to reduce the government’s budget deficit – seems to have been brushed aside.

Is there a good economic reason why Brexit in particular should require abandoning austerity economics? I would argue that the Tory obsession with the budget deficit has had very little to do with economics for the past four or five years. Instead, it has been a political ruse with two intentions: to help win elections and to reduce the size of the state. That Britain’s macroeconomic policy was dictated by politics rather than economics was a precursor for the Brexit vote. However, austerity had already begun to reach its political sell-by date, and Brexit marks its end.

To understand why austerity today is opposed by nearly all economists, and to grasp the partial nature of any Conservative rethink, it is important to know why it began and how it evolved. By 2010 the biggest recession since the Second World War had led to rapid increases in government budget deficits around the world. It is inevitable that deficits (the difference between government spending and tax receipts) increase in a recession, because taxes fall as incomes fall, but government spending rises further because benefit payments increase with rising unemployment. We experienced record deficits in 2010 simply because the recession was unusually severe.

In 2009 governments had raised spending and cut taxes in an effort to moderate the recession. This was done because the macroeconomic stabilisation tool of choice, nominal short-term interest rates, had become impotent once these rates hit their lower bound near zero. Keynes described the same situation in the 1930s as a liquidity trap, but most economists today use a more straightforward description: the problem of the zero lower bound (ZLB). Cutting rates below this lower bound might not stimulate demand because people could avoid them by holding cash. The textbook response to the problem is to use fiscal policy to stimulate the economy, which involves raising spending and cutting taxes. Most studies suggest that the recession would have been even worse without this expansionary fiscal policy in 2009.

Fiscal stimulus changed to fiscal contraction, more popularly known as austerity, in most of the major economies in 2010, but the reasons for this change varied from country to country. George Osborne used three different arguments to justify substantial spending cuts and tax increases before and after the coalition government was formed. The first was that unconventional monetary policy (quantitative easing, or QE) could replace the role of lower interest rates in stimulating the economy. As QE was completely untested, this was wishful thinking: the Bank of England was bound to act cautiously, because it had no idea what impact QE would have. The second was that a fiscal policy contraction would in fact expand the economy because it would inspire consumer and business confidence. This idea, disputed by most economists at the time, has now lost all credibility.

***

The third reason for trying to cut the deficit was that the financial markets would not buy government debt without it. At first, this rationale seemed to be confirmed by events as the eurozone crisis developed, and so it became the main justification for the policy. However, by 2012 it was becoming clear to many economists that the debt crisis in Ireland, Portugal and Spain was peculiar to the eurozone, and in particular to the failure of the European Central Bank (ECB) to act as a lender of last resort, buying government debt when the market failed to.

In September 2012 the ECB changed its policy and the eurozone crisis beyond Greece came to an end. This was the main reason why renewed problems in Greece last year did not lead to any contagion in the markets. Yet it is not something that the ECB will admit, because it places responsibility for the crisis at its door.

By 2012 two other things had also become clear to economists. First, governments outside the eurozone were having no problems selling their debt, as interest rates on this reached record lows. There was an obvious reason why this should be so: with central banks buying large quantities of government debt as a result of QE, there was absolutely no chance that governments would default. Nor have I ever seen any evidence that there was any likelihood of a UK debt funding crisis in 2010, beyond the irrelevant warnings of those “close to the markets”. Second, the austerity policy had done considerable harm. In macroeconomic terms the recovery from recession had been derailed. With the help of analysis from the Office for Budget Responsibility, I calculated that the GDP lost as a result of austerity implied an average cost for each UK household of at least £4,000.

Following these events, the number of academic economists who supported austerity became very small (they had always been a minority). How much of the UK deficit was cyclical or structural was irrelevant: at the ZLB, fiscal policy should stimulate, and the deficit should be dealt with once the recession was over.

Yet you would not know this from the public debate. Osborne continued to insist that deficit reduction be a priority, and his belief seemed to have become hard-wired into nearly all media discussion. So perverse was this for standard macroeconomics that I christened it “mediamacro”: the reduction of macroeconomics to the logic of household finance. Even parts of the Labour Party seemed to be succumbing to a mediamacro view, until the fiscal credibility rule introduced in March by the shadow chancellor, John McDonnell. (This included an explicit knockout from the deficit target if interest rates hit the ZLB, allowing fiscal policy to focus on recovering from recession.)

It is obvious why a focus on the deficit was politically attractive for Osborne. After 2010 the coalition government adopted the mantra that the deficit had been caused by the previous Labour government’s profligacy, even though it was almost entirely a consequence of the recession. The Tories were “clearing up the mess Labour left”, and so austerity could be blamed on their predecessors. Labour foolishly decided not to challenge this myth, and so it became what could be termed a “politicised truth”. It allowed the media to say that Osborne was more competent at running the economy than his predecessors. Much of the public, hearing only mediamacro, agreed.

An obsession with cutting the deficit was attractive to the Tories, as it helped them to appear competent. It also enabled them to achieve their ideological goal of shrinking the state. I have described this elsewhere as “deficit deceit”: using manufactured fear about the deficit to achieve otherwise unpopular reductions in public spending.

The UK recovery from the 2008/2009 recession was the weakest on record. Although employment showed strong growth from 2013, this may have owed much to an unprecedented decline in real wages and stagnant productivity growth. By the main metrics by which economists judge the success of an economy, the period of the coalition government looked very poor. Many economists tried to point this out during the 2015 election but they were largely ignored. When a survey of macroeconomists showed that most thought austerity had been harmful, the broadcast media found letters from business leaders supporting the Conservative position more newsworthy.

***

In my view, mediamacro and its focus on the deficit played an important role in winning the Conservatives the 2015 general election. I believe Osborne thought so, too, and so he ­decided to try to repeat his success. Although the level of government debt was close to being stabilised, he decided to embark on a further period of fiscal consolidation so that he could achieve a budget surplus.

Osborne’s austerity plans after 2015 were different from what happened in 2010 for a number of reasons. First, while 2010 austerity also occurred in the US and the eurozone, 2015 austerity was largely a UK affair. Second, by 2015 the Bank of England had decided that interest rates could go lower than their current level if need be. We are therefore no longer at the ZLB and, in theory, the impact of fiscal consolidation on demand could be offset by reducing interest rates, as long as no adverse shocks hit the economy. The argument against fiscal consolidation was rather that it increased the vulnerability of the economy if a negative shock occurred. As we have seen, Brexit is just this kind of shock.

In this respect, abandoning Osborne’s surplus target makes sense. However, there were many other strong arguments against going for surplus. The strongest of these was the case for additional public-sector investment at a time when interest rates were extremely low. Osborne loved appearing in the media wearing a hard hat and talked the talk on investment, but in reality his fiscal plans involved a steadily decreasing share of public investment in GDP. Labour’s fiscal rules, like those of the coalition government, have targeted the deficit excluding public investment, precisely so that investment could increase when the circumstances were right. In 2015 the circumstances were as right as they can be. The Organisation for Economic Co-operation and Development, the International Monetary Fund and pretty well every economist agreed.

Brexit only reinforces this argument. Yet Brexit will also almost certainly worsen the deficit. This is why the recent acceptance by the Tories that public-sector investment should rise is significant. They may have ­decided that they have got all they could hope to achieve from deficit deceit, and that now is the time to focus on the real needs of the economy, given the short- and medium-term drag on growth caused by Brexit.

It is also worth noting that although the Conservatives have, in effect, disowned Osborne’s 2015 austerity, they still insist their 2010 policy was correct. This partial change of heart is little comfort to those of us who have been arguing against austerity for the past six years. In 2015 the Conservatives persuaded voters that electing Ed Miliband as prime minister and Ed Balls as chancellor was taking a big risk with the economy. What it would have meant, in fact, is that we would already be getting the public investment the Conservatives are now calling for, and we would have avoided both the uncertainty before the EU referendum and Brexit itself.

Many economists before the 2015 election said the same thing, but they made no impact on mediamacro. The number of economists who supported Osborne’s new fiscal charter was vanishingly small but it seemed to matter not one bit. This suggests that if a leading political party wants to ignore mainstream economics and academic economists in favour of simplistic ideas, it can get away with doing so.

As I wrote in March, the failure of debate made me very concerned about the outcome of the EU referendum. Economists were as united as they ever are that Brexit would involve significant economic costs, and the scale of these costs is probably greater than the average loss due to austerity, simply because they are repeated year after year. Yet our warnings were easily deflected with the slogan “Project Fear”, borrowed from the SNP’s nickname for the No campaign in the 2014 Scottish referendum.

It remains unclear whether economists’ warnings were ignored because they were never heard fully or because they were not trusted, but in either case economics as a profession needs to think seriously about what it can do to make itself more relevant. We do not want economics in the UK to change from being called the dismal science to becoming the “I told you so” science.

Some things will not change following the Brexit vote. Mediamacro will go on obsessing about the deficit, and the Conservatives will go on wanting to cut many parts of government expenditure so that they can cut taxes. But the signs are that deficit deceit, creating an imperative that budget deficits must be cut as a pretext for reducing the size of the state, has come to an end in the UK. It will go down in history as probably the most costly macroeconomic policy mistake since the 1930s, causing a great deal of misery to many people’s lives.

Simon Wren-Lewis is a professor of economic policy at the Blavatnik School of Government, University of Oxford. He blogs at: mainlymacro.blogspot.com

 Simon Wren-Lewis is is Professor of Economic Policy in the Blavatnik School of Government at Oxford University, and a fellow of Merton College. He blogs at mainlymacro.

This article first appeared in the 21 July 2016 issue of the New Statesman, The English Revolt