I am not much impressed with Roger Bootle’s drearily conventional arguments for what the UK economy needs.
“I have banged on before about decisions on key projects which have large public sector involvement but which may also hold the key to major private sector spending, e.g. over London’s airport capacity.”
Preposterous Keynesian fallacy at work. It presupposes that money allocated to some project via the political process is more likely to create a ‘multiplier’ than market driven uses of that money… and it assumes that the money taken by the state by force would not have been invested in something more worthwhile in aggregate if the decisions were left to its original owners before it was confiscated by the state.
But of course as it is easier to see something like an airport rather than the myriad of other uses the money would have gone to had it not been forced into that project, so somehow the big flashy ‘infrastructure’ protect is claimed to have driven knock-on investment and is therefore an obvious Good Thing. As Bastiat put it “That which is seen versus that which is not seen”.
Ain’t necessarily so and given the record of government decision making versus the more diffused decision making of markets, usually ain’t so.