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There's no three-day week and the lights have yet to go out. But in every other way yesterday's pre-budget report (PBR) was a throwback to the 1970s. For a start, we had a chancellor admitting that the country was in an awful - but unexpected - jam. What's more, we had a good old-fashioned remedy for the crisis, oodles more public borrowing to finance a VAT holiday, accelerated public spending and a package of help for small businesses.
Finally, there was a vague echo of old Labour class-war rhetoric, with the commitment to raise the top rate of tax to 45% on those earning more than £150,000. This is less of a risk than it once would have been for the government. Ministers sense, almost certainly correctly, that the public blames City fat cats earning more than £150K a year for the country's current predicament and want them to suffer financially for their reckless speculation.
In truth, Alistair Darling could probably have put it up to 50% without much resistance from a chastened City.
But if the decision to abandon the commitment not to raise the top rate of tax - one of the bedrock beliefs of New Labour - was no gamble, the rest of the PBR most certainly was.
The prime minister and his chancellor are betting the farm on the 2.5 percentage point cut in VAT prompting a splurge in spending that will limit both the depth and the duration of a recession neither of them saw coming.
"I am confident the slowdown will be shallower and shorter than would have been the case," Darling said yesterday. Yes, just as he was confident in the March budget that the economy would grow by 2.5% next year and that borrowing would be £38bn. The new estimates are for a 1% drop in national output and £118bn of red ink splattered over the public finances.
The thinking behind the cut in VAT is simple. Prices will come down for a temporary period and that will entice consumers back into the shops.
Will the public respond? Jonathan Loynes at Capital Economics notes that Marks & Spencer and Debenhams were forced to cut prices by 20%-25% last week to drum up business, so it is questionable whether a 2.5-point cut in VAT - even assuming it is passed on by retailers - is going to make that much of a difference. Consumers may have a bit of a spree in the next six weeks before tightening belts in the new year.
Should that happen, the government will have a struggling economy and the biggest overdraft in Britain's history. It would go down to crushing defeat at the next election - although looking at the tax increases and public spending constraint inevitable in the next parliament it might be a good one to lose.
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