If we are to believe Alistair Darling, public expenditure is going to save the UK economy.
Last week, he presented his revised budget plans, and he didn't hold back. By the time of the next election, the government should be spending at least £630 billion. When Labour elected back in 1997 (what I prefer to call year zero), public expenditure was just £290 billion. That is a hefty 110 percent increase.
I know that that inflation will have influenced these figures. However, I thought Brown has sorted out that problem within a week of becoming Chancellor when he made the Bank of England independent.
So did public expenditure really double, or did the UK economy suffer from a prolonged period of hidden inflation?