Budget Resolutions and Economic Situation

I share the hon. Gentleman's analysis. Indeed, we share a common analysis of the problems at Leeds United, but we had better not go there. It is interesting to see that we share that economic analysis as well. As Joseph Stiglitz explained last month—this picks up perfectly on the hon. Gentleman's intervention—we need""investments in technology, education and infrastructure . . . In short, more such spending will stimulate the economy and create jobs in the short run and promote growth and debt reduction in the long run."" So the most prestigious economist in the world argues against cuts and advises us instead to invest in modernising the economy as the best thing that we can do for growth and to pay off the deficit. Making those investments would give us a chance to build a new economy, and in turn a new Britain, which the economic crisis has underlined is necessary. It would allow us to move away from the dangerous financialisation of our deeply unbalanced economy and away from the neo-liberal economics that have left such deep social scars over the past 30 years—the scars of greater inequality, a sense of vulnerability, and in the workplace a race to the bottom in terms of conditions and wages. Instead, Government investment to modernise the economy, especially in housing and transport, where investment has fallen most, and with a focus on developing a low-carbon economy and on providing the education that is needed for a high-skilled economy, would boost the economy in the short term, as well as improving long-term growth and prosperity. That brings me to today's proposals by the Chancellor and how we should judge the Budget. On first hearing, I would say that there has been some recognition of the need to increase investment and of the role of Government to ensure that. I did not join in the applause of many of my hon. Friends when my right hon. Friend said that we would be selling the banks back at a profit. I think that we should retain some of these banks under Government control, so that they become national investment banks. I especially welcome the green investment bank, and I hope that it is given sufficient funds to invest directly in creating the modern, green economy that we need. A recent report by the Green New Deal group explained how a £10 billion green investment would re-skill 1.5 million people, bringing 120,000 people back into the work force and increasing, very importantly, the earnings of those on low incomes by a total of more than £15 billion. It explains that such investment would save the Government billions of pounds in reduced benefits and increased taxes alone. On the wider Budget, there are some questions to consider. Is the level of investment announced in the Budget enough? Is it being implemented in the correct way? Is it going to the right sectors to create the kind of high-skilled, highly paid jobs that Britain needs? I would argue that judgments cannot be formed in the immediate aftermath of a Budget, and echo the response of the Chinese premier, Zhou Enlai, who, in the 1960s, was asked by the French ambassador what he thought was the impact of the French revolution of 1790. Zhou Enlai thought for a while and said, "It's too early to say." When the dust settles over the next few weeks, today's Budget will be judged on whether it will provide the Government investment needed to get the economy back on track. However, one thing is already clear. The plans of the Opposition for cuts not investment—for slash-and-burn economics—certainly offer no way forward. Like many in this House, I remember the devastation caused by such policies in the 1980s. They would hit ordinary people, hit our services, and drag the economy backwards. We must ensure that we do not return to that failed economic model. If this Budget is the beginning of a break with new Labour's love affair with neo-liberalism, I welcome it, but there is a long, hard road before us.