The second shift is the succession of crises—both economic and, increasingly, ecologically driven—that have spurred unprecedented levels of state intervention. In adopting this approach, the incoming prime minister and her chancellor are, like Minford, happy to tolerate escalating debt levels. This was before the sharp increase in energy costs, which Truss’s price cap will only partly offset. Rising rates are all the more problematic for some as energy crisis borrowing adds to already high pandemic debt piles. Sri Lanka is already in the grip of a major crisis, as the update from Ahilan Kadirgamar in this issue of International Socialism explains.

Source: The Guardian September 21, 2022 21:42 UTC