Not just a sense that the Budget growth predictions could be right but that they could be exceeded.

That would mean sustained growth on a level not seen since the dotcom bubble or the Lawson boom – to pluck two ominous precedents from history.

There is a belief that the financial sector could bounce back stronger than expected, that UK plc has the right sectors to make something extraordinary of the growth opportunities round the corner.

I’m getting positively light-headed.

The PM on tour:

I can’t get across enough how much this crisis has made all sorts of certainties about how Britain’s economy is run, well, completely uncertain.

It’s not just the fact that the Sir Fred Goodwin memorial 50p tax rate is basically not actively opposed by George Osborne. A policy of this kind has been politically unthinkable for a decade-and-a-half.

Now, following months of remuneration rage, pension pot-pique, and banker-baiting, nearly 60 per cent of the nation backs tax rises on the richest 350,000 earners.

So what is the game plan for UK plc now that the bonus-addled bankers, and even Sir Michael Caine, are to be taxed off the island? I thought our whole business model was in servicing the world’s super-rich and promoting banking as “the goose that lays the golden egg”.

Well, last week’s budget was more than a calamitous set of numbers, it was surely the failure of an entire economic mindset.

As I’ve said before, the carnage inflicted the public finances are of an order associated with a world war, and I cannot imagine a better subject for parliamentarians to investigate than how we have got into this mess.

As many of the commenters on this blog have also suggested, there are profound questions about the shape of our future economy. The government had a stab last week.

Roger Bootle, the celebrity economist who predicted the death of inflation, has just put out a paper examining where the economy goes from here.

“It would be misleading to talk about when things ‘get back to normal’. After all, what is normal?

“The economy surely cannot return to how it was before. The economy over the next ten years will look significantly different to the economy of the last ten years,” he says.

He expects a decade where consumer spending growth underperforms growth in the economy. So hello Nescafe society, and goodbye £3 lattes.

And talking of froth, have a look at this article by Stephen Green, the chairman of HSBC. Britain’s senior banker has a devastating line in there about Britain’s economy, I’ll blog about it later.

In the meantime, do you have any idea how to reshape Britain’s economy? I’m thing of holding a Dragon’s Den-style pitch for Britain’s New Business Plan…

The total interest payments of £43bn will be more than non-investment spending in the defence budget, and seem to remain at around 3 per cent of GDP for the foreseeable future.

Now Gordon Brown used to refer to that proportion of additional spending devoted to debt interest and social security as “the costs of failure”. The then-chancellor said at the time of the spending review in 2000 that:

“Our promise was to reduce the costs of failure – the bills for unemployment and debt interest – in order to reallocate money to the key public services.

“In the two decades from 1979 until 1997, rising debt interest and unemployment and social security accounted for 42 per cent of all extra public spending and that meant that 42 pence in every additional pound spent was not available to the key public services.

“In the coming three years, unemployment, social security and debt interest payments will account for not 42 per cent but now only 17 per cent of extra public spending.”

Well, between 2009 and 2011, according to table C9 on page 238 of the budget, the “cost of failure” in terms of interest costs (called central government gross debt interest) is 52 per cent.

If you add in social security costs of £6.2bn, then that failure cost reaches 72 per cent. Now the Treasury will argue that the timeframe is arbitrary, and that social security costs should not be considered a failure.

But maybe it just goes to show that the boomtime claims of the then-chancellor warranted a little more scrutiny.

Massive deficits in the coming three years of half a trillion pounds. BUT even those rely on a remarkable boom in 2011. Look at the chart below to get an idea of the likely size of the deficit in comparison to those since the Second World War (click to see a larger version):

Source: IFS, updated by Channel 4 News to include projections from today’s budget.

National debt is set to peak at 79 per cent of GDP. Only last year the budget assumed a “ceiling” of 40 per cent on national debt that had been kept to for a decade. That is totally obliterated in a year.

Page 38 of the Red Book says current spending will grow by an average of 0.7 per cent a year between
2011-12 and 2013-14 in real terms. So far under the Labour the growth rate has been 3.2 per cent.

That means that the chancellor is planning public spending growth lower than in the Thatcher era.

So what happens if the Great Boom of 2011 doesn’t happen? Do the public finances unravel? Or is that the problem of George Osborne?

I’d love to know what’s going on in George Osborne’s head. On the one hand he could hope to be a shoo-in for Number 11 in the next 11 months. But the chancellor has effectively tied his hands for most of a likely Conservative first term.

We are working on a physical representation of what a trillion pounds looks like. But just for guidance, go to YouTube (see below).

Why do we want to know? Because the chancellor, if he dares mention it, will today unveil what we’re all in for – and it’s got an awful lot of zeroes.

Interestingly, our indebtedness is not the worst in Europe, and is actually not the worst we’ve ever endured. It’s quite a lot smaller than the debt we ran up during the second world war – and somehow we recovered from that.

But today’s grim unemployment figures, 2.1 million, are a reminder that all this stuff is very far from notional. And the people responsible – beyond the political classes who set up the “light-touch regulation” which all parties favoured – number no more than a few thousand in terms of those who managed the institutions in which it all went on.

On this grim day, not one faces prosecution and not one is in jail.

But really this is a budget about recent history, about the calamitous carnage wrought by the credit crunch on Britain’s public finances. It could be called the hangover budget.

Firstly, despite the wobbles of the IMF, we will get the first indication of the direct bill for the bailout of our banking system. Not the £200bn IMF estimate, now withdrawn, more like £50-60bn. But an incredible admission nonetheless.

Since November’s PBR the UK government has signed its biggest contract since lend-lease in 1941. That was signed with the US to help fight a war. The point about today’s numbers is that they will show a fiscal impact on Britain in keeping with a major war.

So the “prudent provision” for losses on bank support is the first number I will be looking for. It may well be the largest single measure in any budget.

Secondly, watch out for another cut to the planned growth in total public spending. The PBR pencilled in real-terms growth of 1.1 per cent per year between 2011 and 2016. If the spin on efficiency savings is right, that number will fall well below 1 per cent.

That means a lower average growth in public spending planned by a likely outgoing Labour government than the average of the Thatcher era between 1979 and 1990.

And I’ll also be looking out for one of Gordon Brown’s favourite measures of public finance failure. When he was Chancellor he often boasted that whereas he devoted 17p in the pound of extra public spending to the “costs of economic failure” – that’s debt interest and social security, the Conservatives had averaged 42 pence. I strongly suspect that this budget will see those costs exceed the 42p milestone.

Stand back from it and will we get a reshaped business plan for UK plc? Or is this a government that can only hope to jump-start the City, and get house prices up?

At a time when the Treasury printers are running out of red ink, it’s a little contrarian, I realise, but if there’s only one lesson to learn from the credit crunch, it is this: when the political classes are in total consensus it’s best to assume they are wrong until irrefutable proof appears.

Let’s be clear. There is not going to be a stimulus tomorrow, instead some “targeted help” funded by cuts elsewhere. In fact, as things stand, Britain, uniquely in the G20, is going into a year of discretionary fiscal contraction, say the OECD and IMF.

In other words various taxes, (think VAT, fuel duty, stamp duty, national insurance, and some income taxes on high earners), are actually currently planned to go up in the middle of a stinking and historic recession. Public spending growth was already planned to be curbed greatly.

This is entirely because of the undoubtedly dire state of the public finances, specifically deficits of over 10 per cent in the coming years.

But talking to the likes of Sushil Wadhwani it strikes me that the idea of a grand US-style stimulus package has far from disappeared. Rather it’s been parked, for an opportune moment.

The former Bank of England interest rate-setter says that history shows it “irresponsible” to rule out a stimulus. In a credit crisis, it’s precisely monetary policy that may stop working. History shows you would want to keep the fiscal stimulus option primed.

The Treasury is playing “wait and see” with the Bank of England’s experiments in creating money.

As Bank of England newbie Paul Fisher today suggested: “This hasn’t been done in the UK before, so no one knows exactly how successful it will be.”

Clearly the opposition fears a pre-election Keynesian splurge in the autumn or in a year’s time. But if the green shoots continue to be trampled on, and the world economy does not fire up, the Treasury may well need to stock up on even more red ink, whoever is chancellor of the exchequer at the time.

ORIGINAL POST: The IMF has hugely upgraded its projection for the likely total costs of the bank bailout.

In today’s Global Financial Stability Report the costs of financial stabilisation are put at a whopping 13.4 per cent of GDP, or £200bn. This brings the IMF in to line with the estimates from the experts in our special investigation last month.

It is an absolutely massive number, arising principally from the toxic asset insurance scheme.

And on the eve of a budget when we are told the kitty is empty for further stimulus to the economy, it raises all sorts of questions about how much money is being diverted to the financial sector.

Certainly the single biggest budget decision made since November’s mini-budget may or may not score in the number crunching: a likely loss of tens of billions from the government insurance scheme for the toxic assets of RBS and Lloyds – the Asset Protection Scheme.

At the Treasury, ministers privately describe that move as the largest contract signed by the UK government since the lend-lease arrangements with the US government in the Second World War. The IMF has estimated the likely cost at 8 per cent of GDP or £130bn. Last month we attempted some estimates, which ranged from £100bn to £250bn.

The Treasury is floating the idea that it will cost £60bn. This is hugely significant: the first official confirmation that we are likely to see a massive loss worth around double the defence budget.

Still, it seems apparent to me that the Treasury views the IMF figure as feasible, though perhaps a tad high.

Of course theoretically, the government could make a profit from the insurance premiums they have been paid (mainly in the form of bank shares). But it’s worth noting that the lend-lease debt to the US was only repaid in full in December 2006.

So will the grandchildren of the credit boom generation still be repaying the great 2009 bank bailout in 2077? Hopefully not.

- UPDATE: IMF has upgraded its estimate to £200bn.

Channel 4 is not responsible for the content of external websites.