Gordon Brown’s queer idea of financial stimulus

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The fact is that since the reversal of the VAT cut at the turn of the year there is no fiscal stimulus in the economy.

Indeed plans already in place to impose a 50p income tax band, to restrict tax reliefs on pension contributions and later to raise the level of National Insurance contributions all amount to fiscal tightening.

Readers may differ on whether these various moves are desirable but there could be no one who thinks they amount to a fiscal stimulus.

Of course running a budget deficit amounts to a stimulus because it puts additional demand into the economy — but somehow I don't think that was what Gordon Brown had in mind.