Borrowing is going up, whoever wins the election. Both the Conservatives and Labour want to borrow lots of cash to invest in infrastructure – more houses, roads and railways.
But while the upward direction of travel is shared, Labour is clearly aiming for the bigger ramping up. Something like an extra £55bn a year versus £15-20bn under Tory plans. Clearly, your judgment of those plans should depend on how well you think the different parties would spend the money, but the scale of extra borrowing fits stereotypes of leftwing parties being less fiscally restrained than their conservative rivals.
But are those stereotypes fair? Not across the Atlantic, where Republican Donald Trump has blown the budget with massive tax cuts. He’s been accused of abandoning traditional Republican prudence. But new analysis suggests that on this one issue Trump is in fact normal. Republican administrations since the last war have, if anything, been more likely to expand government debt than Democrat ones despite all the posturing about the need for balanced budgets. Switching from a Republican to a Democratic presidency is associated with an annual reduction in debt of 1.8% on average.
The authors suggest this is because Democrats worry that if debt is high it will undermine public services in future. Maybe, but it’s also true that leftwing parties are under more pressure to show they’re responsible with the public finances. That might explain why Republican administrations have repeatedly got away with implementing tax cuts they couldn’t afford. The lesson? In politics as in life, let’s judge people on what they do, not what they say.
• Read more from Torsten Bell’s Top of the Charts at resolutionfoundation.org
