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Ben Chu: The Tories' silly dance in the streets of Rome

Posted by Eagle Eye
  • Thursday, 29 October 2009 at 03:12 pm
Of late the Tories have been trumpeting the fact that Italy's economy is now "bigger" than Britain's, in order to embarrass Gordon Brown. George Osborne cited it in a speech earlier this week. And David Cameron did so in yesterday's PMQs. But the fact that they're making such a big thing of this statistic simply demonstrates their own economic confusion.

This "second sorpasso" has occurred not because the Italian economy is in better shape than Britain's, but because the value of the pound has fallen dramatically against the euro in the past year.

Would the Tories support British entry to the eurozone if it made our economic output figures look healthier in cash terms? Of course they wouldn't. Would they prefer a strong pound, despite the pain this would inflict on our exporters? One sincerely hopes not.

And another thing. The Tories complain that Britain's level of public debt, which is projected to hit 79 per cent of GDP in 2013-14, threatens to push us into national bankruptcy. But according to the OECD Italy's public debt levels are projected to hit 120 per cent by the end of next year, making them, according to the Tories' analysis, already bankrupt. So let's get this straight. Osborne and Cameron are holding up a bankrupt country as something for Britain to aspire to. Does anyone else find this alarming?




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