The Financial Times Has Some Tough Love Advice For David Cameron

David Cameron is learning that the confidence fairy is not going to rescue the UK's struggling economy. Martin Wolf suggests that he should have listened earlier to those who told him about the "paradox of thrift". If the government has decided to run a budget surplus then some other sector of the economy must run a deficit. The corporate sector is running a surplus by investing less on building future growth than its retained earnings. Perhaps the government needs to take some temporary measures to encourage business investment as long as it insists on reducing its deficit.