Corbyn's economics guru urges Starmer to borrow and spend more

Mr Stiglitz calls on Labor to be more radical after 'under-promising'; ahead of general election Photo: Jason Alden

The Nobel laureate in economics, who advised Jeremy Corbyn, calls on Sir Keir Starmer to increase government borrowing and increase investment.

Joseph Stiglitz, left-wing economics guru calls on Labor be more radical after «insufficient promises» ahead of the general election.

The World Bank's former chief economist told The Telegraph: “I think Labor needs a more aggressive public investment program. This is the same problem we have in the United States with insufficient investment in infrastructure.»

This comes after the Labor Party abandoned its $28 billion green investment commitment earlier this year pounds, blaming high interest rates and suggesting «maxing out your credit card.»

Instead, Sir Keir's opposition unveiled revised plans to spend less than £5 billion a year on environmental projects during his first parliamentary term if elected, multiple polls have shown.

This led to a warning from Mr Stiglitz, who has also previously advised former US presidents Bill Clinton and Barack Obama, that the UK risks being “left behind” if it fails to reach net zero.

p>

He said: «Biden said he was going to spend about $350 billion (£277 billion) transition to a green economy. Current estimates exceed $1 trillion. This is the competitive environment that Britain must recognize that it faces.

“If Britain does not commit to a green economy, it will make life more expensive and leave the UK behind.”

The number of people forced to leave work due to ill health has risen by 600,000 to a record 2.8 million, largely due to a rise in mental health problems.

Mr Stiglitz said: «What have the Conservatives done?» into the National Health Service over the last 14 years has really contributed to this problem.

“If you have any health problems and you don't get treatment, when they are serious enough, it is very difficult to work. . Ironically, the lack of work is caused by insufficient investment in health care.»

People who find it difficult to access treatment begin to worry about their health and the impact on their income, which becomes a «vicious circle.»

Mr Stiglitz added: «Then you have mental health problems and that makes it very difficult to return to the workplace.»

The government is trying to stem the rise in benefits by tightening the criteria for people who say they are too mentally unwell to work.

Work and Pensions Secretary Mel Stride recently warned that the “culture of mental health” has gone too far, while Prime Minister Rishi Sunak spoke of the dangers of “over-medicalization” of routine care.

But Mr Stiglitz said it was «cruel» to «deny the reality» of problems such as depression and anxiety.

Mr Stiglitz, who won the Nobel Prize in economics in 2001, also criticized neoliberalism, which usually used to describe policies that deregulate markets, lower trade barriers, and reduce the size of government.

He said: “Markets are very good at creating crises and problems, but they often fail to solve the problems they create.” .

“The way our market system operates puts a lot of pressure on a lot of people and is a source of problems that undermine productivity.

“If you have an economic system in which the rungs of the ladder are far apart, if you If you're anywhere other than the bottom, you're more concerned about not falling down those stairs. It actually impairs your ability to move up the corporate ladder.”

People at risk of poverty are so focused on survival that it discourages innovation and risk-taking, he said.

Mr Stiglitz also called for higher taxes on billionaires such as Elon Musk, saying the Tesla tycoon was not a “self-made man.”

He said: “ Tesla received half a billion dollars from the US government at a critical time. Elon Musk has forgotten about this and thinks that he is a self-made man. Without this money he wouldn't be where he is. Now he is trying his best to forget about it.”