BRITAIN could run a £45 billion deficit and have more jobs and higher wages than today, Labour MP Michael Meacher said yesterday.

Mr Meacher will today launch “What the main parties are not telling you,” his new book that blows a hole through the economic arguments for austerity.

The book’s Budget day release is designed to debunk Chancellor George Osborne’s argument that we need more cuts to wipe out Britain’s £95bn deficit.

But speaking to the Star yesterday, Mr Meacher argued: “I think we shouldn’t be seeking to reduce the structural deficit to zero.

“Apart from Germany, who are fanatical about it under Angela Merkel, no other country seeks to do that.

“As long as the deficit is around 3 per cent of GDP — which is about £45bn for us — the more important thing is growth.”

Mr Meacher accepted the claim may be controversial with many who have swallowed the cuts consensus, including within Labour.

He pointed out though that five years of austerity have delivered low wages and left unemployment at almost two million, while inequality has reached Edwardian levels.

“It’s an ideological aim,” he said. “It’s not to do with macro economics, it’s to do with shrinking the state. To keep contracting the economy by reducing expenditure in order to eliminate the deficit is madness if it is leading to a huge fall in wages."

“That’s not the way to run and economy or a state.”

Ha-Joon Chang, author of Penguin’s Economics: A User’s Guide, is among a dozen economists who have contributed essays to the book.
- The public launch is tonight, 6.30pm, the Wilson Room, Portcullis House, Parliament.