GE19 will be remembered as the “spend, spend, spend” General Election, with every party offering to outbid the others in retail offerings to the electorate. 

Labour clearly top the bidding. They say they would boost annual revenue spending (on public-sector wages and supplies) by £80 billion by 2024 – that’s a 10%increase on current Tory plans. In addition, Labour want to increase capital investment (roads, schools, Trident) by £55bn a year, effectively doubling current levels.

READ MORE: Labour and Tories clash in trillions spending claim dossier row

At the weekend, they also announced another (one-off) £58bn to compensate women shortchanged by the Tory-LibDem coalition government when it summarily raised the state retirement age. That promise equates to an average individual cash handout of £15,380 for each of the 3.7 million WASPI women affected. That £58bn – if spent immediately – would add circa 2.7% to GDP, instantly injecting life into our high street retailers.

However, the fascinating thing about GE19 is that the Tories have also abandoned the fiscal prudence (aka “austerity”) they have pursued as an ideological mantra since the days of Mrs T. Chancellor Sajid Javid was barely a month inside Number 11 before he managed to blow the entire £27bn Budget reserve carefully squirrelled away by his starchy predecessor, Philip Hammond. Result: in October, UK government borrowing rose to its highest level in five years.

The Tories are happily criticising Labour’s election spending proposals but Javid himself has already committed to Tory Budget plans equalling 42% of GDP, which takes us back to the levels last seen before Mrs Thatcher. In hard numbers, whoever enters Downing Street on Friday December 13,annual public spending will be more than five GDP points higher.

Why this volte-face from the fiscal cannons of neoliberalism upheld by Thatcherites and New Labour alike for the past 40 years? Is this opportunism or do they really mean it?

Neoliberal austerity had deep roots. In the immediate post-war period, strong unions in the US and UK had raised wages, squeezed profits and provided the political pressure to increase taxes to expand welfare and educational provision. But US and UK capitalism were suffering competition from lower wage economies in Europe and Japan. To recover competitiveness, the neoliberal agenda was born. The unions were smashed, taxes reduced, and the state downsized.

In America, neoliberalism at least had the benefit of creating the conditions for a massive increase in manufacturing investment and new technologies. But in the UK, City finance capital took advantage of Thatcherite deregulation to act like pirates. Instead of a manufacturing boom, industry was sold off cheaply to foreign owners while Britain’s finance capitalists made pots of money in non-productive asset and property speculation.

Result: real incomes stagnated as did productivity. The reckoning came when these bogus asset speculations blew up in 2008.

To save the bankers’ skins, Labour and Tory governments arranged a bailout paid for by another round of austerity.

The rise of Jeremy Corbyn, plus the imminent threat of Scottish secession, has shaken Tory confidence that they can continue with their policy of saving the banks at the expense of the people. Meanwhile, to their right, Nigel Farage and the Brexit movement have mobilised populist discontent with the establishment. Enter Toff Boris with a cunning plan to save the City and the elites. BoJo is prepared to see off the challenge from both left and alt-right by using appeals to English nationalism plus short-term spending increases to rebuild the Tory electoral base. Yet if he succeeds, the new libertarian Tories in BoJo’s Cabinet will not return to business as usual. Instead, they will implement their lifetime Thatcherite goal of turning Britain into a deregulated, low tax, low wage, American aircraft carrier anchored off Europe.

READ MORE: McDonnell says Labour manifesto oil levy ‘not a tax on Aberdeen’

Be warned: yesterday’s Tory manifesto was largely window dressing. It promised a freeze on income tax, national insurance and VAT. But if the post-Brexit economy sees slower growth (very likely), stealth taxes will rise sharply. Care for the elderly got short shrift in the manifesto and there is no more cash for local authorities. These Tory Budget numbers are back-of-the-fag-packet stuff and will come apart in months, if BoJo gets elected.

Is a Corbyn victory the answer? No progressive can favour Boris over Jeremy. But Labour’s election spending plans are only “radical” relative to the previous Tory austerity. Despite criticism from the independent but conservative Institute for Fiscal Studies, Labour’s spending blueprint is hardly revolutionary compared to other industrial nations. Many countries already have greater relative state spending than Labour plans to achieve. They include Germany, Netherlands, Norway, Sweden, Denmark, Finland and France. Actually, Denmark, Finland and France have public spending of more than 50% of GDP.

Labour intend to raise corporation tax back to 28% to fund spending increases. Given that companies have used tax cuts to buy back their own shares rather than invest, that is sensible. Germany outperforms the UK industrially despite higher taxes precisely because the money is channelled to infrastructure investment, not speculation.

But there’s an even better example – China. The rush by Trump’s America to ditch neoliberal austerity is primarily a reaction to China’s rise to global economic power on the back of Beijing’s state intervention and long-term planning, which has made it the second biggest economy on the planet.

Alas, Labour’s investment plans are small beer in comparison to China’s. British annual fixed investment in machinery, property and infrastructure runs at around 16% of GDP (and falling due to Brexit uncertainties). In France the investment ration is 23%, Norway and Japan 24%, Sweden 25%, South Korea 31%, and China a staggering 42% (using OECD 2015 numbers).

If a Corbyn government succeeds in its wildest spending plans, it runs to circa £55bn extra per annum, in the first parliament. That adds a piffling 2.6 percentage points of GDP. It would still leave UK investment trailing its European competitors, never mind China or South Korea. Corbyn and John McDonnell are proposing a modest (by global standards) shift from consumption to investment, not a socialist revolution.

Which is why Scots electors – especially the young and the progressive – should not be deflected from voting SNP on the grounds that Labour are promising a radical alternative. In fact, a strong SNP group at Westminster is vital to keeping Labour tacking to the left when the City tries to sabotage it.

We await the SNP’s 2019 manifesto this week. However, given the party leadership’s fidelity to Andrew Wilson’s fiscally conservative Growth Report, we can assume certain things about the budget policy of a soon-to-be independent Scotland.

Andrew proposes keeping annual borrowing below 3% of GDP and total accumulated debt to only 50% of annual output. These limits are ludicrously tight, given the UK General Election debate and the need to repair the ravages of a decade of extreme public austerity.

If there is a lesson in the GE19 debate it is that being fiscally timid in the face of and economic and social emergency just leaves open the door open to voter disillusion or the rise of alt-right demagogues.

Conclusion: when we get to the 2021 Holyrood election or the independence referendum, being fiscally feart will not win votes.