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Amendment of the Law

Part of the debate – in the House of Commons at 9:03 pm on 24th March 2014.

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Photo of Kwasi Kwarteng Kwasi Kwarteng Conservative, Spelthorne 9:03 pm, 24th March 2014

That is absolutely right. The right hon. Gentleman’s principal fault was that he thought he had abolished the business cycle—no more boom and bust. He essentially believed—and it is incredible to think he did believe this—that he had discovered perpetual motion and that the laws of economics and of economic gravity had been suspended or abolished. That was the problem we were in: we were borrowing money even when the economy was growing. In 2004 I recall the economy grew at 3%, yet we ran a deficit of 3%. There is no Keynesian in the world who would suggest it was a good policy to borrow 3% of GDP when the economy was growing, yet the previous Government persisted in doing that.