Who Should Pay for the UK Blockade in the Face of the COVID-19 Pandemic?

Abstract

This chapter examines what lessons can be learned from three previous crises that created public debt mountains of similar magnitude to the pandemic: the First World War, Second World War, and Credit Crunch. In all three cases the Treasury pressed for drastic spending cuts, to maintain confidence in sterling and the City. However, in the one case where the Treasury’s advice was rejected, there was a substantially stronger recovery. The Treasury has similarly lobbied for austerity measures to deal with the COVID-19 government debt, again raising the spectre of slow growth and mass unemployment.