UK ‘would be sick man of Europe’ with Corbyn as PM

JErEMy Corbyn would turn Britain into ‘the sick man of Europe’ again if he won the keys to 10 Downing Street, experts warned last night.

research group Capital Economics said a socialist Labour government posed a major threat to the UK.

The think-tank estimated that the economy would be 2.5 per cent smaller after five years of a Corbyn-led government than it would be under the Tories.

That would cost the country £50billion in lost output in one parliament – or £2,000 per household.

Vicky redwood, a global economist at Capital Economics, said: ‘The effects would build up over time. It is perfectly plausible that before too long, the UK would once more become the sick man of Europe.

‘Forget Brexit. The biggest thing to happen to the UK economy over the next couple of years could be the advent of a Labour government, and a particularly left-wing one at that.

‘In an extreme scenario, with Labour implementing a full-scale assault on the free market and private property rights,

‘Full-scale assault on the free market’

investment would plummet and the downward pressure on sterling could result in exchange controls.’

Warning of higher borrowing costs for the Government, households and businesses, she added: ‘There is a big question mark over whether Labour would actually stick to its borrowing plans. The faintest whiff that Labour was not sticking to its plans and government bond investors might immediately take fright.’

Labour plans to nationalise vast swathes of the economy if it wins power, including the water, energy and postal sectors and telecommunications, bus and rail firms.

Mr Corbyn and his Marxist shadow chancellor John McDonnell also want to raise corporation tax from the current level of 19 per cent to 26 per cent. The Tories plan to cut it to 17 per cent.

Proposed changes to income tax mean some workers would pay a marginal rate of as much as 67.5p on every £1 they earned between £100,000 and £123,000.

Britain was dubbed ‘the sick man of Europe’ in the 1970s as industrial strife and soaring inflation under Labour leaders Harold Wilson and Jim Callaghan brought the country to its knees.