Shut your eyes and it’s as if the last 30 years never happened. David Cameron and George Osborne are taking us straight back to the 1980s. If the leaks of the past few days are correct, Wednesday’s budget is going to cut the top rate of tax for the richest 1%, while the minimum wage is reduced in real terms and public sector pay is hacked back in the poorest regions.

The class priorities really couldn’t be clearer. Just as in 1979 and 1988, a Tory chancellor is prepared to court serious unpopularity to attend to the core interests of the party’s most privileged supporters, while cuts in real pay, benefits, tax credits and unemployment drive down living standards for the majority.

It’s a combination that reflects the classic conservative fallacy: economic incentives only work by increasing rewards at the top end and by reducing them at the bottom. But the difference this time round is that the Tories are cutting a popular tax on the rich with Liberal Democrat cover.

Of course, Osborne and Nick Clegg insist that by cracking down on tax avoidance, the wealthy will end up paying more. But if the 50% tax doesn’t bring in significant revenue, then it can’t be the disincentive to enterprise Conservatives claim – while more serious tax collection might be.

In reality, if it hadn’t been having any impact, the Tories wouldn’t be gagging to get rid of it. Meanwhile, to add to the budget’s retro feel, the government has been gripped by a new asset-stripping frenzy. The health service, schools, postal service, police and now roads are all up for sale, outsourcing and corporate cherry-picking.

The solution to every problem turns out, like a broken record, to be privatisation. Nothing, it seems, has been learned from the failure of an economic model that brought us to the brink of breakdown. For the urbane ideologues now running the show, this crisis has become a ready-made opportunity to shrink the state, shock-doctrine style, and hand over yet more ready-made markets to corporate monopolies.

Roads and other infrastructure projects are the latest candidates to “leverage” private investment the state can’t afford: except that the existing £53bn worth of such private finance initiative schemes are expected to cost the state £20bn-£25bn more than if it had funded them directly.

Crucially, none of what Osborne announces on Wednesday is going to kick-start an economy that is at best flatlining, stifled by cuts, starved of investment and consumer demand, and at risk of further debilitating shocks. And the evidence of the past 30 years is clear enough: any idea that cuts in corporation taxes or the top rate of income tax are going to deliver an investment revival without the prospect of renewed growth is trickle-down fantasy.

Escape from economic stagnation would instead need a serious boost to public investment and consumer demand, mobilisation of the state-dominated banks to drive recovery, and intervention to rebuild an economy hollowed out by City-first deindustrialisation and deregulation.

Not much chance of that from a government committed to austerity and a small state. But behind the coalition curtain are glimmers of recognition that the private sector won’t pick up the slack from the state or rebalance the economy away from a bloated financial sector.

Even Cameron is demanding an industrial policy – though clearly not the kind Vince Cable spelled out in his leaked letter last month. That included not only a call for more public intervention to build up new industries, but for state-controlled RBS to be turned into a public investment bank to support “sectors of strategic importance”.

Cable was slapped down by Cameron and Osborne, and even Labour’s Ed Balls balks at the prospect. But the point is unanswerable. Central to the corporate-driven ideology that dominates this government and public debate is a myth: that the risk-taking, entrepreneurial private sector drives technological innovation and industrial advance, while attempts by state bureaucracies to “pick winners” are a recipe for disaster.

That myth is exploded by Sussex University economist Mariana Mazzucato in her book The Entrepreneurial State. Even in the US, heartland of “free enterprise”, the public sector has taken the risk to invest in one cutting edge sector after another: from aviation, nuclear energy and computers to the internet, biotechnology and nanotechnology.

The private sector has come in later – and usually reaped the reward. So the algorithms that underpinned Google’s success were funded by the public sector. The technology in the Apple iPhone was invented in the public sector. In both the US and Britain it was the state, not big pharma, that funded most groundbreaking “new molecular entity” drugs, with the private sector then developing slight variations. And in Finland, it was the public sector that funded the early development of Nokia – and made a return on its investment.

The lessons should be clear. States such as Germany, South Korea and China are now spending far higher proportions of national income on research and development into green technologies. Even some Tory ministers understand that only state intervention can drive the new motors of growth – but dare not say so publicly.

That’s hardly surprising. But the government’s economic strategy isn’t working. If Britain is going to rebuild a broken economy, its political class is going to have to learn to turn its back on three decades of clapped-out myths and bankrupt ideology.

Happy 20th birthday, email! Next week – on 11 March, if you’re planning a party – it will be precisely two decades since the first email with an attachment was sent, rescuing email from its academic niche and sending it out into the big wide world, like the young Orca Willy, liberated from the amusement park hell and set free to make backflips in the sea (until it’s time for the sequel).

Maybe you are thinking, Why write this celebratory column now when it would surely make more sense to do it next week? Ah, but we live in an internet age now, in which news is supposed to break at least a week before the event itself happens. Get with the programme, grandad!

So congratulations, email; in one more year you can legally get drunk in the US and then send late-night misguided missives to your ex-lovers on your own medium, and then suffer meta remorse.

But as one matures, one’s parents cease to treat one like a child. This at times shocking development (“Wait, you expect me to do my own washing when I stay at yours for Christmas? MY OWN WASHING?”) often manifests itself in them not praising absolutely every little thing you do. Once a simple finger painting was viewed as proof that you were “very advanced, developmentally – should we put her down early for an MA at the Courtauld, do you think?” Now it’s: “Horizontal stripes? On your hips, honey? Are you sure?”

So it has proven for poor little email. On Monday, Nathaniel Borenstein, the frequently dubbed “father of email”, said at a conference that, actually, he is disappointed in his child prodigy. Something about its cumbersome code, which makes his kid look bit of a chubster, or it clutters up the internet, which is basically the same thing in parenting terms. This code, according to Daddy Dearest Borenstein, was supposed to have changed as email evolved but instead has remained locked in the internet and this has caused Borenstein paroxysms of guilt.

Well, Mr Borenstein, suffer no more. If you think a pesky code is the worst retort to the initial optimism we all had about the internet, you clearly have never been on dailymail.co.uk. My God, in the eyes of some of us, or possibly just one of us, the internet is nothing but one hot, bubbling sea of disappointment and human failure. So to slake Mr Borenstein’s nights of insomnia, here are the worst things about the internet, all of which make a pudgy code look like a downright blessing:

1. Twitter feuds

Just edging past retweeting of compliments, detailing your lunch in your Facebook status update, the concept of quantifying your friends as if they were currency and getting LinkedIn requests from the jerk who used to bully you at school, Twitter feuds are the worst of the detritus trailed by social media. Hearing about other people’s petty quarrels is dull enough; having to watch them conducted on Twitter between the likes of Miley Cyrus and her ex-boyfriend makes one doubt Darwinism: “I can’t change you’re [sic] mind … Maybe YOU’RE the one pretending you’re fine,” scribes the Achy-Breaky fille. Oh, Dorothy Parker – whither thou now?

2. The black hole of dailymail.co.uk’s righthand column

Look, I’m a journalist, ergo I’m very much on Team Journalism. Yay! So, fine, let the Daily Mail exist in all its fetid form. But not even an empty box of Krispy Kremes can cause as much self-loathing and act as a testament to the addictive nature of the product within as the righthand column of celebrity photos on the Daily Mail’s home page. I look at that website more times a day than I go to the loo (forgive me, merciful God!) and I didn’t even realise there were other stories on it besides those photos until about a month ago. What does Imogen Thomas wear to the gym? Why can someone called Lauren Goodger not stop eating? And how does Ice-T’s wife maintain those curves? These are questions I have never asked myself and yet I seek their answers as soon as I am on the Daily Mail’s website and the hours slip away. But what I lose in time, I gain in knowledge. Um, right.

3. Bankruptcy

Wait a minute, I’ll get to you as soon as I’ve bought this dress on theoutnet.com. And then done my Ocado order. Oh! And I meant to order those things off Amazon yonks ago! Here’s the thing about spending money on the internet: it doesn’t feel like you’re spending money, and don’t even get me started on the devilish taunt of websites asking if you want them to “save your payment details.” Damn you, netaporter.com! So if Borenstein really wants to improve an internet algorithm (oh yeah – I saw The Social Network), when you buy something over the internet, you should physically have to insert the money into the screen, one note at a time. It’s the only thing standing between me, bankruptcy and death caused by drowning in my own flat beneath a sea of netaporter.com shopping bags.

 Firms quit work experience scheme

Firms and charities are to be invited to bid for a payment-by-results scheme to try to get “Neet” teenagers into work or training, in a project launched by Deputy Prime Minister Nick Clegg.

The £126m scheme is aimed at 55,000 teenagers in England with poor qualifications who are currently not in education, employment or training.

Mr Clegg says it will help youngsters “into the world of work”.

But Labour says the project is “too small and much too late”.

Chris Keates, leader of the Nasuwt teachers’ union, accused Mr Clegg of being responsible for an increase in Neets by scrapping the Education Maintenance Allowance.

‘Ticking time bomb’Mr Clegg described the problem of rising youth unemployment as a “ticking time bomb”.

“Sitting at home with nothing to do when you’re so young can knock the stuffing out of you for years,” he said.

“We urgently need to step up efforts to ensure some of our most troubled teenagers have the skills, confidence and opportunities to succeed.

“Many of them will have complex problems: truancy, teenage pregnancy, a lack of GCSEs and health problems.”

Mr Clegg said to see teenagers who have left school with no qualifications “slumped on the sofa in front of the telly is not only tragic for them… but it stores up huge problems for the future if we don’t help them now”.

He said it was also about getting “crucial early years in a child’s life at school right” to “save on so much heartache later”.

“If you start early it then allows children to start their school career with a sense of enthusiasm for learning,” he said.

The scheme, part of the Youth Contract announced in the autumn, will invite bids for contracts worth up to £2,200 for each teenager who can be sustained in work, education or training for 12 months.

The target group will be 16- to 17-year-olds without any GCSEs at C grade or above.

The aim is for long-term savings from an early intervention.

Almost one in five young people aged between 16 and 24 are classified as Neet – with the most recent figure standing at 1,163,000.

This response from the government is aimed at teenagers at the lower end of this age range who are already at risk of “disengagement” from the world of work.

The organisations that win these contracts will have a free hand to decide their approach – with the emphasis on rewarding a successful outcome.

Payments will be staggered, so that the full amount will be paid only to contractors when young people have remained in work or training for a year.

The funding will reflect the highest level of Neet youngsters in this age group – with £14m available in the West Midlands, where 11.5% of 16- to 17-year-olds are in this category.

The project has been challenged by the ATL teachers’ union, which accused the government of damaging the chances of teenagers “by dismantling the careers and advice service and abolishing the education maintenance allowance”.

 ”We have deep misgivings that getting charities and businesses to provide support for unemployed youngsters outside the education system will undermine the likelihood of success,” said ATL officer Adrian Prandle.

The government’s health reforms run a high risk of reducing levels of safety and patient care while leading to overspending, internal NHS reports have warned.

The potential for conflict between NHS organisations in the new system and upheaval during the transition is high, according to risk assessments drawn up by the four English NHS regions. There is also a high chance the reforms will fail to achieve hoped-for management improvements and budget cuts, they say.

Some of the anticipated problems are rated at the highest risk category, “significant”, and many others are considered “high risk”, even after mitigation measures designed to tackle the issues raised, and despite all actions taken after previous risk reports last autumn.

The warnings – dated January and not due to be updated for three months – will be in place when the controversial health and social care bill becomes law, provided the government succeeds in getting it passed before Easter.

The reports are by the four NHS super-regions in England, created last year by merging 10 regional bodies together into London, the south of England, the Midlands and east, and the north of England. They emerge at a tricky time for ministers as they are likely to reflect the concerns raised by a national risk register, drawn up by civil servants at the Department of Health last year, which the health secretary, Andrew Lansley, is fighting a legal battle to avoid publishing. Pressure on Lansley will be further raised next week when Labour has called an opposition day debate on the issue.

Andy Burnham, the shadow health secretary, highlighted the “devastating” finding in London that officials are still warning of “preventable harm to children” because of the risk of losing key staff, and poor information sharing between the newly created organisations.

“You know something is seriously amiss when NHS London has identified a risk of ‘preventable harm to children’ but has been unable to reduce it,” said Burnham. “That should surely be a sign that it’s time to listen to the view of health professionals that it’s safer to abandon the reorganisation than press on.

“What these devastating documents reveal is that, even though risks to patient safety have been identified, the NHS has not been able to mitigate them. The reason for this is simple: the government gave the NHS mission impossible when it asked it to save a massive £20bn whilst simultaneously dismantling it.”

Burnham added: “David Cameron is putting political pride before patient safety. People won’t forgive him if he digs in and damages the NHS. He needs to listen to the sensible members of his own cabinet and drop the bill.”

There was a further blow to the government after a surge in support for an e-petition on the government’s website that urged ministers to drop the health bill. The petition passed the 100,000 signatures threshold – the point where motions are considered eligible for debate in the Commons.

Health officials stressed the regional risk reports were intended to identify and manage threats in the hope they did not become actual problems. Unlike the national risk register, which was a one-off, the regional risk reports are regularly updated, and the latest versions contain new and upgraded risks, as well as some which have been reduced, occasionally enough to be removed altogether.

A Department of Health spokesman said: “Departmental risk registers are management tools that play a key role in the formation of government policy – they are separate and independent to [strategic health authority] risk registers.

“We have never previously published our risk registers as we consider them to be internal management documents. We believe that their publication would risk seriously damaging the quality of advice given to ministers and any subsequent decision-making.”

The spokesman defended the bill, adding: “Our modernisation plans are essential if we are to put the NHS on a sustainable footing for the future, hand power to doctors and nurses, give patients more choice, and reduce needless bureaucracy.”

The reports are the most up to date assessments of risks to the organisations, staff, budgets and patients in the English regions. Each risk is rated on a scale of one to five for both the likelihood of it happening and the impact of the possible problem, with those scores multiplied to produce a final risk rating of up to 25.

According to the report for the north of England, risks rated 15 or higher are considered “significant” and coded in red; those from 8 to 12 are judged “high” or amber risk. In the north of England officials warn the risk of achieving “productivity gains at the expense of quality”, defined as “safety, clinical effectiveness and patient experience”, rates as 12 – a possible event with major impact – even after the mitigation actions so far chosen are taken.

The same report warns of a similarly high risk of “organisational and system instability” damaging management and governance, and uncertainty caused by the changes that could reduce the capacity and capability of staff and organisations.

Lower rated problems – still considered high risks – cover a wide range, again after existing mitigation, including a “loss of grip on current performance”, that “safety is compromised by lack of clarity on accountability, poor morale, and loss of knowledge”, that the benefits of the reforms are not achieved, and there is a loss of public confidence in the NHS.

In the Midlands and east of England, officials are most concerned that a combination of targets to reduce spending, and the management changes, will cause upheaval during the transition, and similarly warn of worse quality and safety, conflict between organisations, neglect of primary care, overspending, and failure to meet key targets such as limiting the number of patients who wait more than 18 weeks for treatment.

Moderate risks in the region include loss of key personnel, staff working in “silos” and so not co-operating as they need to, a rising risk of fraud, lack of clarity about structures for commissioning treatment for patients, staff distracted or overloaded by the upheaval leading to worse service and higher sickness levels among health service staff themselves, confused and unclear accountability leading to “organisational and system failures”, culture clashes, “mission critical” staff leaving, lack of leadership skills among key staff, and loss of confidence among clinical staff leading to the reforms failing.

Unlike other regions, however, risk assessments in the Midlands and east of England are made only before mitigation actions, as officials say it is too early to judge their likely success.In the south of England, three moderate risks were alerted: that there would be worse safety and patient care, conflict in the system, and that there would be no management improvement or financial savings. In London two new risks were added to the register between September and January, and one removed; five more risks were upgraded as being higher, and three downgraded – though two of those three improved areas still rated relatively high for their overall risk. Among those considered greater problems than three months previously were a lack of clarity caused by the transition to a new system, possibly causing confused accountability; staff losing focus on patients because they were distracted by management changes; loss of “key talent”; and failure to cut costs.

As well as the threat to children’s services, others among the highest-rated risks include future problems for maternity services and “specific failures or deteriorations in the financial position of one or more NHS organisations, with the resulting loss of operating credibility”.