It’s v fashionable here on Twitter to scoff at @borisjohnson’s allusions to FDR and his New Deal. Yet the reality is the government is set to borrow more this year than FDR did in ANY year of the 1930s, or any year of the financial crisis, for that matter

The main difference, of course, is that much of FDR’s spending was on public investment whereas the vast majority of our extra spending in 2020 will be on other stuff: furlough scheme, benefits, NHS etc. Just look at how that stuff compares with the £5bn the PM re-announced today

But the economy is, frankly, in a v different place than in the 1930s. Back then US & UK were warfare states where a major chunk of public spending/investment was on the military. Today, esp in UK, it’s on health/welfare. We have less destitution as a result. Comparisons v tricky

Thus far, vast majority of govt spending has been on econ life support. Phase 1 of fiscal story.
Phase 2 comes next: we hear from @rishisunak abt his stimulus plans: extra measures to restart the economy. More akin to FDR.
Phase 3 comes later: what do we do abt all this debt?

And @borisjohnson dropped an interesting hint about phase 3 in his speech today.
Investment, he says, will deliver extra productivity. This is a nice idea. And who knows, it could work. But (see chart) we've been waiting, vainly, for a productivity leap for well over a decade now

Worth noting, btw, that while @BorisJohnson’s capital investment plans will push up govt investment to the highest level since the late 1970s, it’ll still be a lot lower than in the post-war decades.
Another reflection of UK’s shift from warfare to welfare state…