Monday, 16 February 2009

CPI, RPI, AEI and GDP all add up to the same thing

The Conservatives (or Conservativehome) have published a useful detailed paper setting out the options for an incoming Cameron government for rescuing the British economy from Brown's monumentally destructive blundering. It's worth careful reading.

The paper's author has estimated that Brown's spending is £219bn a year higher in real terms than the budget that Labour inherited in 1997. I suspect he's used the CPI. I did the same exercise using the Treasury's GDP deflator a few weeks ago and came up with £185bn a year higher. No doubt if the exercise were done using the Average Earnings Index or the RPI with or without X a slightly different figure will result.

Whichever figure you choose to use, it adds up to the same thing; eleven years of pointless profligacy that have achieved the square root of nothing.

2 comments:

Newmania said...

I have printed that off to chew over , to be honest its a bit confusing. I have nevere really understood what the limits to indebtedness were

Newmania said...

I have printed that off to chew over , to be honest its a bit confusing. I have nevere really understood what the limits to indebtedness were