Nicole Gelinas is a contributing editor to the Manhattan Institute’s City Journal. Follow Nicole on Twitter.
George Osborne wants to help young Britons – by using them to keep bailing out the pre-2008 economy.
For more than three years, Chancellor George Osborne has insisted that his austerity goal is to reduce the size of the British state – and to unleash private-sector prosperity. The centrepiece of his Budget 2013 speech on Wednesday – his “Help to Buy” scheme for would-be house-purchasers – could help to smash those goals.
If Help to Buy works as advertised, it will lure yet another generation of Britons into unsustainable debt. Help to Buy will make Britons dependent, too on yet another expensive government entitlement programme. And even people savvy enough to avoid this new debt trap will suffer.
Rather than admit that the Coalition’s policy of tax hikes and front-line service cuts hasn’t worked, Osborne has devised a big distraction. Citing stringent bank-lending standards that “have put home ownership beyond the great majority who cannot turn to their parents for a contribution,” he proposed in the speech to “put that right – and put it right in a dramatic way.”