David Cameron's deficit reduction: kickstarting the UK's lost decade?

According to today's letter from the UK's foremost economists to the Financial Times, you would certainly think so:

The Treasury has committed itself to more than halving the budget deficit by 2013-14, with most of the consolidation taking place when recovery is firmly established[...] for the good of the British people – and for fiscal sustainability – the first priority must be to restore robust economic growth

protesting the UK Conservatives call to halve the deficit right now.

For those who missed it, one of the main reasons for Japan's "second" lost decade of economic growth (after the bursting of the post-war bubble in 1991), was the Hashimoto government assuming the recovery was back on track in 1997 and increasing taxes to reduce the budget deficit. Simply put, the tax hike depressed consumption and the fragile recovery dipped back into negative or zero growth which continues this day... Let's hope the Cameron government is not just a Hashimoto government in Savile Row suits.

After 20 years, Japan, as the 2nd-largest economic power in the world, has transformed itself into a low-growth economy by necessity. Lessons for the next UK conservative government? Don't head down exactly the same - technically laudable albeit premature - path to long-term low-growth.