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  • There's been a huge row over Labour's tax and spending plans

  • this week.

  • The Conservatives say they'll blow a £1.2tn hole

  • in the nation's finances, creating a tax bombshell.

  • Labour dismisses this as nonsense.

  • It says higher tax will pay for day-to-day spending

  • on things like more nurses and doctors,

  • and it will only borrow for higher capital spending.

  • Some £55bn a year for transport, broadband, green energy,

  • hospitals and schools.

  • That's a lot more, more than doubling current public sector

  • investment plans.

  • It's also a lot higher than the Conservatives' promise.

  • Labour plans would raise government investment back

  • to levels last seen in the 1970s.

  • That's over 4 per cent of national income,

  • raising some big questions about whether Britain

  • can finance its borrowing, and whether it'll be well spent.

  • We sought to find out how investors

  • and British government debt might react.

  • The Chancellor, Sajid Javid, says they'll run scared.

  • He was talking about Labour creating an economic crisis

  • within months.

  • But on the financing question, the government bond market

  • doesn't appear terrified.

  • The UK government can borrow for 10 years

  • at a cost of only 0.75 per cent, a little up from a month ago

  • but still extremely low.

  • We also talked to many people in the markets.

  • The main view was that investors would be willing to finance

  • Labour or the Tory plans very cheaply.

  • For example, Mark Dowding, chief investment officer

  • at BlueBay Asset Management, summed up the view saying,

  • there was a once in a generation opportunity

  • for a big fiscal expansion.

  • But you shouldn't think that because bond investors are

  • prepared to fund big spending, they think it's a good idea.

  • Many we spoke to thought pushing so much money out of the door

  • so quickly would lead to waste and bad investments.

  • The bond market isn't full of vigilantes at the moment,

  • ready to push politicians around.

  • They're happy to finance Labour's plans,

  • even if they think the proposals won't work.

  • And there's a simple reason why.

  • They believe even if the plans are nuts,

  • they'll still be repaid, with at least some interest.

There's been a huge row over Labour's tax and spending plans


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傑里米-科爾賓的支出計劃會讓英國破產嗎?| 報道 (Will Jeremy Corbyn's spending plans bankrupt Britain? | FT)

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    林宜悉 發佈於 2021 年 01 月 14 日