So the recession is over. Really?

Flaunting the idea in today’s circumstances that the recession is now past must be one of the silliest pre-election claims we’re likely to see in the next 9 months.   It omits all the wider context, comparisons with other countries, any sign of general consensus, and above all it omits any detailed examination of the evidence.   Osborne should not be crowing, he shouldn’t even be ruefully pleased, he should be deeply apologetic to the British people for mistake after mistake after mistake in his handling of the economy.   The charge sheet against him reads as follows:

1  Immediately on getting office he abruptly terminated Alastair Darling’s successful policy of stimulating the economy which was bringing down the deficit fast and instead consigned the economy to deep torpor through his ill-fated austerity measures.   If Darling had remained Chancellor, the deficit would have been cleared within 3 years; instead it has taken Osborne over 6 years.

2  Osborne himself unilaterally dug an even bigger hole in Britain’s recession by imposing a big increase in VAT, making deep cuts in infrastructure spending, and making outlandish claims that were it not for his austerity policies Britain would be in the same category as Greece, which damaged business confidence.

3  Taking 6 years to regain the level of annual economic output which was reached 6 years ago is not grounds for satisfaction, it is a cause for humiliation when the US, Germany and France all took less than half as long.

4  Even worse, British economic output per head is still 4% below its pre-crash level, and it will still take another 3-4 years to regain that level.   That means that under Osborne’s policies a whole decade of growth in output per head has been lost.   Indeed Osborne has managed to bring about the lowest level of productivity compared with any other G7 country except Italy.

5  This ‘recovery’ is the shakiest for a century and has no foundations which will make it last.   The big indicator here is that private business isn’t investing.   The FTSE-100 companies are sitting on colossal cash stockpiles of £600-700bn, equal to half Britain’s entire annual income, and not planning for an expansive future.   It really does speak volumes when the capitalists themselves, Osborne’s allies, are so unimpressed by his ‘recovery’ that they resort to an investment strike.

6  Then of course there is the key point that the stockmarket and financial sector may be chalking up a nice recovery for the top 1%, but that’s not how it feels for 90% of the population.   This is probably as good as it’s going to get for Osborne, and it’s not going to change now before the election.   Osborne does still have to answer the question: if his stewardship of the economy has gone so well, how is it that Labour is still 5% ahead in the polls?

3 thoughts on “So the recession is over. Really?

  1. with carney in the bank fiddling the figures ossie outside fiddling the figures rtu ids fidling the figures has how many walked away from claiming has they been sanctioned or 365 day rule were only their national insurance stamp is paid whilst many are doing their salvation army bit stacking shelves hiden away from the real figures yes fiddling it seems runs riffe through this government jeff3

  2. Police Take Up a Collection

    A lobbyist on his way home from Parliament after a Parliamentary Inquiry into Trading Practices by Britain’s leading Bank Executives is stuck in traffic. Several of the former Bank Executives and CEO’s have agreed to return their extravagant Pensions.

    Noticing a police officer, he winds down his window and asks: “What’s the hold up Officer?” The policeman replies: “The Chief Executive of the U.K.’s largest Bank has become so depressed he’s stopped his motorcade and is threatening to douse himself with petrol and set himself on fire because of the shame of what he has done.”

    “Myself and all the other motorcade police officers are taking up a collection because we feel sorry for him.”

    The lobbyist asks: “How much have you got so far?”

    The Officer replies: “About 40 gallons, but a lot of officers are still siphoning.”

    Uncredited.

  3. I’m still seething about the BBC’s headline piece about the recovery and I’m normally very protective of the Beeb.

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