UK public sector net debt was at 96.4% of GDP as of the end of August 2025 and the level of debt at its highest since the early 1960s. These problems are not unique to the UK and many time writer for the Croydon Constitutionalists, Josh L. Ascough released a new book ‘A Theoretical Proposal for Fiscal Discipline and Debt Management‘ that addresses this issue seen across the western world. We speak with Josh.
“government or specific politician is looking to obtain a political legacy by creating a large infrastructure project; I think a certain HS2 project comes to most people’s minds”
Can you give our readers a brief overview of the book?
A Theoretical Proposal for Fiscal Discipline and Debt Management examines the risks of unconstrained debt spending by governments by examining the inevitable trade-offs and what is referred to as GAP (Government Agency Problems) that occur when governments have, in practice, no limit to their debt spending. Some of these are over-investment of government projects, where loose access to debt financing can encourage governments to maintain investment in projects whose costs have risen beyond their initial evaluation and assumed benefits, and legacy, where a government or specific politician is looking to obtain a political legacy by creating a large infrastructure project; I think a certain HS2 project comes to most people’s minds when they hear these two. And finally, the book ends with proposal a fiscal rule to limit the level of debt spending.
Your book proposes a 1.25 Rule, without giving away too much, what are the basics of the rule?
The 1.25 is a fiscal ratio that targets a maximum level of debt spending in relation to the nominal tax revenue the government receives and works in a similar fashion to the debt-to-equity finance in corporate finance models. For a simple example if we suppose the government revenue is 500 billion, then according to the ratio the government would have a maximum of 625 billion it could spend via debt. This would create the incentive for governments to effectively and efficiently allocate public resources into areas that will have long-term benefits with high long-term payoffs while still maintaining enough debt spending for initial investments into public works and as a reserve for crisis.
“create the incentive for governments to effectively and efficiently allocate public resources into areas that will have long-term benefits with high long-term payoffs”
This is your second book, your first being ‘Inflation and Monetary Policy: Understanding the Origins and Costs’. What were a couple of key points from that book?
A major point was that when working on a novel approach to the Environmental Kuznets Curve; which measures the relationship between income per capita and environmental degradation, and typically shows that as countries become richer, they reach a certain point where they’re able to afford more environmentally friendly and sustainable policies and sources of energy. However the problem is the curve uses nominal income rather than being adjusted for inflation, and so the work I did showed that when adjusted for inflation, many countries are in what I called a treadmill state, whereby inflation continues to erode the purchasing power of income per capita, leading to a continuing loop of environmental policies being unaffordable; so those who argue for more environmental protection policies should first look to stabilise and reduce inflation.
Another key point would be Nominal Gross Domestic Product (NGDP) targeting which ties to my second book, as I suggest combining the 1.25 rule as a fiscal policy with NGDP targeting as a monetary policy. In the first book however NGDP targeting is suggested as an alternative to inflation targeting and as a second-best solution to a truly free banking system, as it is able to emulate the monetary equilibrium that the free banking area naturally provided, but as a proxy, and would be able to respond to supply and demand shocks more appropriately than inflation targeting.
“those who argue for more environmental protection policies should first look to stabilise and reduce inflation”
How can people get these books, and more generally get in touch? (you don’t have to answer the get in touch part unless want)
People can find these books on Amazon for relatively cheap prices, the first is £12.99 and the newest book is £7.99. I keep prices down for my work as the money from them isn’t as important to me as getting the research and the final work out into the public.
A Theoretical Proposal for Fiscal Discipline and Debt Management – https://www.amazon.co.uk/Theoretical-Proposal-Fiscal-Discipline-Management/dp/B0FWRLPV3R/ref=sr_1_1
Inflation and Monetary Policy: Understanding the Origins and Costs – https://www.amazon.co.uk/Inflation-Monetary-Policy-Understanding-Origins/dp/B0F91P73RV/ref=sr_1_2
You can read more from Josh on our site at https://croydonconstitutionalists.uk/category/josh-l-ascough/