Not the 1970s

By R.A. | WASHINGTON

MY COLLEAGUE Buttonwood discusses the latest turns in the debate over economic policy in Britain. Some (including The Economist) argue that while structural reform of the economy is critical, both the Bank of England and the government should do more to support growth. Others (including the government) reckon that austerity is the only thing standing between Britain and a debt crisis, and that falling deficits will soon raise confidence and deliver growth. Readers will not be surprised to learn that I agree with the house view, though I sense that Buttonwood is uncomfortable with aspects of it.

What I found particularly interesting about his post, however, was his framing of the current debate, as a replay of the economic battles of the 1970s. Now that may well be the way the debate reads to many in Britain. But if that's the argument people believe they are having, that is a bad sign for the quality of policymaking to come. Because it is very much not the 1970s. Consider two charts: