Michael Meacher MP

It is difficult to exaggerate the magnitude of Britain’s current economic disaster.   The latest figures issued yesterday showing a 0.7% contraction in the second quarter are nothing less than momentous.   The UK economy is now 4.5% below its pre-crash peak in March 2008.   This is stunning for 3 reasons.   First it indicates that in the last 4 years the economy has shrunk by over £70bn, an amount equal to three-quarters of the total UK deficit.   Second, it is far worse than Germany, the US and even Russia, all of which have now grown since their pre-crash peak, and worse even than Spain and Japan.   Only Italy and Ireland have done worse than Britain in the EU.   Third, and most seriously of all, it shows the weakest recover by far of any of the 5 deep recessions that have plagued Britain over the last century.   At this point in the cycle, compared with  just over 4 years from the start of the downturn, even the Great Depression of 1930-34 had given way to 2% growth – in today’s terms an increase in the size of the economy of some £60bn as opposed to the current fall of £75bn. (more…)