The UK Labor Party's new leader Jeremy Corbyn has, rather unsurprisingly, is making controversial headlines already. His appointment of John McDonnell - an outspoken opponent to the independence of central banks - as shadow chancellor has been met with derision in the British press. Initially described as a "nutjob" by The Telegraph, McDonnell's 'plan' to close the deficit is simple - instead of cutting spending, he will dramatically raise taxes on businesses and the rich. The Telegraph then watered-down their perspective, we think, slamming McDonnell's policy as "cloud cuckoo land economics."
Jeremy Corbyn, the new leader of the U.K. Labour Party, named an opponent of Bank of England independence as the party’s Treasury spokesman, in the latest signal of the main opposition’s new political direction.
While it wasn’t part of Corbyn’s election program, McDonnell is also a critic of the Bank of England. In 2012, he set out his own vision for Labour’s first 110 days in power.
“In the first week of a Labour government, democratic control of the major economic decisions would be restored by ending the Bank of England’s control over interest rates,” McDonnell wrote. He went on to propose “bringing the nationalized and subsidized banks under direct control to force them to lend and invest their resources to modernize our economy and put people back to work.”
McDonnell told Sky News television Monday that “my new policies and Jeremy’s have been roundly endorsed by the leadership election, so what I’m going to try and do now is try and convince our colleagues in Parliament of the need for change.”
Britain’s “economy would be safe in our hands but also be more prosperous,” he said.
But. as The Telegraph's Jeremy Warner exclaims (admittedly not the most 'fair and balanced' newspaper on the matter) not everyone agrees on this "prosperous"...
I know that Corbynomics should be treated with the due consideration afforded to it by the BBC, and as a voice of reason I should confine my comments to dutifully pointing out some of its flaws, but I can’t. Indeed, the whole thing is such a joke that I don’t know why I’m writing about it at all. What’s proposed is beyond parody.
You’ll be relieved to know, however, that Mr McDonnell is not a deficit denier. In fact, he believes “deficit denial is a non-starter for anyone to have any economic credibility with the electorate”.
But instead of closing the deficit by cutting spending, he proposes to do it by raising taxes, targeted at the rich and business. In pursuit of this goal he’s discovered an astonishing £93bn of tax “subsidies” to business which he proposes to abolish. Simples.
At a stroke, the deficit is made to vanish. I’m kicking myself for not thinking of this. All along it was staring us in the face, but somehow or other, we all came to miss it.
As I say, it’s scarcely worth attempting to counter this kind of cloud cuckoo land economics, for it is an agenda that will never be implemented. What Mr McDonnell proposes goes way beyond what Francois Hollande tried to do in France. There is no chance of any of this ever reaching the statute books.
Politically, however, there are profound implications. Even acknowledging tribal loyalties, which continue to run deep in British politics, it’s hard to believe the natural constituency for nonsense like this - and obviously there is one - is more than 20pc of the vote.
People like Corbyn will inspire the violent overthrow of capitalism for what they think will be the betterment of man. They are idiots and dangerous ones at that for you cannot eradicate human nature. Yet they will try.
Which was promptly retracted
or in "cloud Cuckoo land"
For those not of a British persuasion it appears being "from cloud cuckoo land" is less egregious than "being a nutjob" - though either way, we suspect a man running the nation's money that is described thus may not end well.