Keynesianism that is, or the management of the economy through fiscal policy. Allow us, for a moment, to pretend, and assume that we've found ourselves miraculously in agreement with all and every of Keynes' tenets. We will even agree that borrowing £175 billion in the coming year is a good idea (and that no, it doesn't matter what we spend it on) because we really could do with some fiscal stimulus.
So, where does this leave us? Well, we're saying that we need this fiscal stimulus because there are unused resources in the economy and that growth is going to be below trend. Right, but as the IFS points out, this gives us something of a problem. For if we are below trend now it's fairly easy to show that in recent years we were above trend. As indeed the IFS points out.
Now remember that we have drunk the Keynesian Kool Aid in its entirety. Just as we believe in fiscal stimulus when growth is below trend, we also believe in fiscal contraction when growth is above it. And can anyone see that happening in recent years?
Such a contraction would have meant raising more in taxes than was being spent by government. Instead of public borrowing, we would have had debt repayment. And can anyone really believe that was going to happen? When you've Polly Toynbee screaming that we can and must abolish child poverty for only a few billion more? When every policy panhandler is pronouncing on how this or that evil of the world can be solved for just a little more taxpayers' cash and anyway, isn't this what a Labour government is for?
Well, quite. The failure of the system is thus a political one at the very least. Whether it works as an economic system is for others to determine but if it's politically impossible to have fiscal contraction when the theory says that there must be fiscal contraction then it's not all that useful a theory, is it?