It’s the economy.....
Good article by Peter Kellner in the
Guardian last week suggesting that the essential narratives for the next
General Election were now in place. The Coalition parties can now say that
they have weathered the terrible economic conditions bequeathed by New Labour
and at long last the economy is growing and all the other benefits –
higher incomes, lower unemployment and so on - are set to return. The Labour
party, on the other hand, will say that the recession was longer and more
painful than it needed to be, and that the recovery is not affecting real
lives of real people, but is a statistical nicety. Choose your narrative and
decide who to vote for. I think it is easier to deride the Labour analysis. They can quite
rightly complain that things are not getting better for 90% of the country
just because a few economic indicators are finally rising. However, it seems
unlikely that by the time of the next election – assuming continued (if
desultory) growth – at least many of those benefits have not been
delivered. We would expect unemployment to be falling and incomes to be
rising. There is no doubt that the recession started under Labour’s
watch and the Coalition will be seen to have succeeded in its main ambition.
If Labour persists with that narrative I would expect them to lose quite
heavily. The flaw in the Government’s claim is rather more subtle. I
think this is the start of a very slow recovery, but it is not the recovery
we have been promised. It is in fact a very New Labour recovery, and very
much what Labour would have given us had they won the last election. The
Coalition was aiming for a ‘re-balanced’
economy, one that was less dependent on the banking and finance sectors, less
dominated by London and the South East, one which was led by manufacturing
and exports. What we have is a service sector, South
East led recovery whose first real manifestation is a housing bubble. This is
not a rebalancing of the economy but more of the same economic model which
failed so abysmally five years ago. In my view signs of recovery can only be welcomed. It has been a
desperate few years for most people, and any relief will be welcome. But it
is not the recovery the government wants or is looking for and it is not the
sort of recovery which will lead to sustainable growth over the longer term. Anyone remember Boom and Bust? |
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Blog #4 |
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Blog #5 |
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Blog #6 |
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Blog #7 |
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Blog #8 |
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Blog #9 |
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Blog #10 |
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Comments |
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Pete Birks |
“You write:
"What we have is a service sector, South East led recovery whose first
real manifestation is a housing bubble. This is not a rebalancing of the economy
but more of the same economic model which failed so abysmally five years ago." |
John Dodds |
“Boom and Bust.
Didn't Gordon Brown abolish that?” |
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you would like to comment on any of these Blog pieces please email me on: bjc@briancreese.co.uk