Adam Smith Institute

A new report from Global Vision suggests that while Germany is in shape for economic recovery, Britain isn't – quite a turn-around from a decade ago. While Germany and most of Continental Europe have adopted at least a measure of economic common sense in the last ten years, Britain seems to be taxing and spending itself into oblivion.

OECD figures show that general government outlays accounted for 41.2 percent of the market-price measure of GDP in Britain in 1997 compared with 48.3 percent in Germany. Since then, the share of government outlays in UK GDP has risen by 3.4 percent to 44.6 percent, while Germany has cut it by 4.4 percent to 44.3 percent.

Economists David B Smith and Dr Eugen Mihaita of the University of Derby say that even the limited reforms of 2003, when Germany was facing crisis, have helped. But the real reason why Germany's prospects are rising and Britain's are falling is down to a decade of Gordon Brown. He inherited low taxes, low spending, a deregulated economy, and has spent the past decade letting them all slip away.

Who's part of 'Old Europe' now?

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