Economists back Alistair Darling over cuts delay

More than 60 leading economists backed Chancellor Alistair Darling today over his decision to delay spending cuts until next year.









In two letters to the Financial Times, they said it could be "positively dangerous" to begin cuts - as the Tories are planning - and would risk tipping the economy back into recession.



The letters are a direct riposte to a letter sent to The Sunday Times by a group of 20 leading economists urging more rapid action to tackle Britain's £178 billion deficit.



One letter organised by Lord Skidelsky, a cross-bench peer and biographer of the economist John Maynard Keynes, accused the authors of The Sunday Times letter of trying to "frighten" the public over the scale of the deficit.



"How do the letter's signatories imagine foreign creditors will react if implementing fierce spending cuts tips the economy back into recession?" they ask.



"For the good of the British public - and for fiscal sustainability - the first priority must be to restore robust economic growth."



The other, organised by Lord Layard, emeritus professor of economics at the London School of Economics, commends Mr Darling's "sensible" plan for reducing the deficit.



"While unemployment is still high, it would be dangerous to reduce the Government's contribution to aggregate demand beyond the cuts already planned for 2010-11," they said.



"History is littered with examples of premature withdrawal of the government stimulus, from the US in 1937 to Japan in 1997. With people's livelihoods at stake, a responsible government should avoid reckless actions."



The signatories to the letters include two Nobel laureates - Joseph Stiglitz and Robert Solow - and five former members of the Bank of England's monetary policy committee, including former deputy governors Sir Andrew Large and Rachel Lomax.



A spokesman for Mr Darling said that the letters belied shadow chancellor George Osborne's claim that there was a consensus among economists on the need for early action to tackle the deficit.



"Once again George Osborne has jumped on the wrong bandwagon. His judgment is wrong and his approach would risk derailing the recovery," the spokesman said.



"It's obvious to most people that government support is still needed until recovery is secured. It's a view shared by most other governments around the world of all political colours."

Start your day with The Independent, sign up for daily news emails
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksA special investigation by Andy McSmith
2015 General Election
May2015

Poll of Polls

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Tradewind Recruitment: Geography Teacher

£90 - £140 per day: Tradewind Recruitment: We are currently looking for a Geog...

Tradewind Recruitment: Phase Co-ordinator for Foundation and Key Stage 1

Negotiable: Tradewind Recruitment: Phase Co-ordinator for Foundation and Key S...

Tradewind Recruitment: SEN Teacher

Negotiable: Tradewind Recruitment: SEN Teacher We have a fantastic special n...

Tradewind Recruitment: History Teacher

Negotiable: Tradewind Recruitment: My client is an 11-18 all ability co-educat...

Day In a Page

Isis hostage crisis: The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power

Isis hostage crisis

The prisoner swap has only one purpose for the militants - recognition its Islamic State exists and that foreign nations acknowledge its power, says Robert Fisk
Missing salvage expert who found $50m of sunken treasure before disappearing, tracked down at last

The runaway buccaneers and the ship full of gold

Salvage expert Tommy Thompson found sunken treasure worth millions. Then he vanished... until now
Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Homeless Veterans appeal: ‘If you’re hard on the world you are hard on yourself’

Maverick artist Grayson Perry backs our campaign
Assisted Dying Bill: I want to be able to decide about my own death - I want to have control of my life

Assisted Dying Bill: 'I want control of my life'

This week the Assisted Dying Bill is debated in the Lords. Virginia Ironside, who has already made plans for her own self-deliverance, argues that it's time we allowed people a humane, compassionate death
Move over, kale - cabbage is the new rising star

Cabbage is king again

Sophie Morris banishes thoughts of soggy school dinners and turns over a new leaf
11 best winter skin treats

Give your moisturiser a helping hand: 11 best winter skin treats

Get an extra boost of nourishment from one of these hard-working products
Paul Scholes column: The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him

Paul Scholes column

The more Jose Mourinho attempts to influence match officials, the more they are likely to ignore him
Frank Warren column: No cigar, but pots of money: here come the Cubans

Frank Warren's Ringside

No cigar, but pots of money: here come the Cubans
Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Larry David, Steve Coogan and other comedians share stories of depression in new documentary

Comedians share stories of depression

The director of the new documentary, Kevin Pollak, tells Jessica Barrett how he got them to talk
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
English Heritage adds 14 post-war office buildings to its protected lists

14 office buildings added to protected lists

Christopher Beanland explores the underrated appeal of these palaces of pen-pushing
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee