UK economy: two cheers for the government

‘We are building an economy fit for the future,’ the UK Chancellor of the Exchequer, George Osborne, announced today.

The reason for his satisfaction? The figures for GDP in quarter 1 show we have avoided a triple dip recession: to my heartfelt relief, GDP grew in the quarter and the unrelenting decline seems to have been stemmed. For now.

But how much was the growth? Just 0.3%. If that’s a harbinger of the economy of the future, there isn’t a lot to look forward to. 

On the other hand, looking back isn’t particularly heartening, either, at least for the administration.

The British ConDem government, the so-called coalition between Conservatives who run the show and the Liberal Democrats who rattle along behind, like cans attached to the back of a newlywed couple’s car, doesn’t play the blame game. Of course. No-one does. 

It merely points out that it inherited a miserable economic position from its Labour predecessors.

That’s not blame. That’s recognition of the fact that Labour was in power before them and applied its economic policies. So it’s obviously their fault. Not blame, just a statement of fact.

What they’ve never explained, at least not to my satisfaction, is how the presence of a Labour government in Britain caused so much damage to the economies of the United States, Italy, Ireland, Spain and, indeed, most of the rest of the world. It had always seemed to me that there might have been some kind of global economic crisis, of which Britain, even under Labour, was more a victim than a perpetrator. But, hey, I may just be naïve.

Just for the sake of argument, though, let’s say that what happened back in 2008 really was the worst financial crisis since 1929. Wouldn’t you say that to get us back out of recession after just five quarters, and then take growth to 7% as part of five consecutive quarters of growth, was quite impressive?

Alistair Darling: a comparison that doesn't flatter Osborne

Well, so would I. Quite an achievement by Osborne’s predecessor, Labour Chancellor Alistair Darling. 

Particularly if ten ConDem quarters later, as the graph shows, we’ve had only five quarters of growth. One was impressive at 0.9%, but the rest were pretty anaemic. And the latest, as we were saying, was just 0.3%.

An economy fit for the future? Osborne’s not really very ambitious, is he? Or maybe he prefers to keep us looking forwards rather than back. Because he’s way behind the performance achieved under Labour just before he took office. 

No mileage for Osborne in drawing attention to that comparison...

The government: no easy ride for the bone idle

It’s seemed to me for a long time that to be successful in government you have to be a skilful politician, to get elected in the first place, and a good statesman to make something of office once you get there.

Nicolas Sarkozy showed great political skill seeing off his rivals for the presidential nomination in 2007, and then thrashing his opponent (though admittedly she was pretty weak). Once in power, though, he proved so sadly mediocre a statesman that even his superior political talents couldn’t secure him a return to the Elysée.

Back on this side of the Channel, our previous Prime Minister, Gordon Brown was a fine statesman. Assisted by an able Chancellor of the Exchequer, Alistair Darling, he returned the country to growth in early 2010 after the 2008-2009 recession. Today, that looks little short of miraculous. But his indecisiveness and short temper made him a lousy politician (most notably when he indulged in some choice comments about a voter without realising that he was wearing a live mike). Result: he quickly turned a lead in the polls into a deficit he couldn’t overturn before the last election.

But the people who really take the prize are the present lot, above all the Prime Minister, David Cameron, and his Chancellor, George Osborne. They seem inept at both politics and statesmanship.

They failed to win a majority against the hapless Brown, partly because they initially started off telling the electorate just how much the programme of austerity they were planning was going to hurt. So, while I took delight in the damage it was doing to their poll standing, I couldn’t help feeling a tinge of rueful admiration for their honesty. On the other hand, they may have chosen this line because they were expecting everyone to blame Labour – you know, ‘look at the terrible things Labour’s legacy is going to make us have to do to you.’ 

In fact, and unsurprisingly, quite a few voters simply wondered why they’d vote for a party that had nothing better on offer.

When they realised that they were losing votes, Cameron and Osborne switched tack and started talking of the sunlit uplands that awaited us all when they cleared the deficit and reduced the national debt. They stressed the happy ending rather than the painful road they were going to take us down to get there. 

In a sense, that was actually more honest than the previous position, because it revealed them to be just as mendacious as any other politicians.

It wasn’t enough to win them outright victory, but it gave them the opportunity to get their backsides onto cabinet seats in the present tawdry coalition with the Liberal Democrats. The latter, by the way, have consigned themselves to oblivion for a generation for having made this government possible.

In power, Cameron and Osborne have revealed just how lamentable they are as statesmen. The country’s back in recession. Debts have barely dropped. And as unemployment climbs to record levels, the worst of the cuts are still to come.

Meanwhile, their competence as politicians continues unchanged. For instance, when the Unite union threatened a strike by fuel tanker drivers, they saw a great stick with which to beat the opposition: Unite is a major contributor to Labour. So Ministers whipped up a panic about shortages and even urged people to stockpile fuel at home. There were queues at petrol stations around the country, and a woman was badly burned after the petrol she had had the presence of mind to store in her kitchen exploded.

Together with a budget that increased taxes on the poorest and reduced them on the top 1% of incomes, this kind of behaviour led to their turning a narrow lead at the end of last year into a record-breaking lead for Labour in recent weeks (some of that’s soft though: the leaders of the Opposition have a lot of consolidation work to do, but they must be grateful for the help the government’s giving them). 

Cameron and Osborne.
Yep, the picture does them complete justice

What’s fascinating though is the way one of those Opposition leaders is beginning to get right under the government’s skin. Not so much Ed Miliband, the leader, though he’s beginning to land some telling blows, as the Shadow Chancellor Ed Balls. As the Guardian pointed out at the weekend, he’s been right on a couple of notable points, above all in his assertion that the government’s policies would lead us back into recession without sorting the debt problem. So – balls by name, but when it comes to talking balls, he leaves that to the government, and limits himself to exposing it.

Nothing is so painful for a politician as to face an opponent who told him so. And it’s a test of good politicians that they can rise above that pain. But, as I’ve said, Cameron isn’t a good politician. Faced with Ed Balls’ provocative asides, he’s cracked a few times in recent times, most notably last week when he was heard to call him a ‘muttering idiot’.

Interesting that he takes Balls’ barbs so badly. I can only put it down to the phenomenon Dorothy Parker pointed to when she said ‘I don't care what is written about me so long as it isn't true’. Whoever said that the truth can never hurt was showing the kind of propensity for talking balls that marks our present government. A lie can be shrugged off, but a true criticism strikes deep and hard.

So poor old Cameron. He’s beginning to lose it. The sure sign of the beginning of the end. 


Couldn’t happen to a more deserving chap, really.

But why is he so bad at all this? After all, he has a background in PR. Why is he so incompetent at communications?

Without wanting to do any pop psychology, I can’t help feeling the answer’s easy. He’s never had to strive for anything. Everything’s dropped into his lap. Eton, then Oxford. At Oxford, he was in the Bullingdon club whose members liked to get drunk in restaurants and then trash them, knowing that ‘Daddy’ would be round to pay for the damage. Why, he even got his chance to enter Parliament because the previous holder of his seat, Shaun Woodward, defected to Labour and had to give it up.

There have been increasing rumours that Cameron simply doesn’t work too hard. A lot of holidays, frequent evidence of attending meetings poorly briefed.

Could it simply be that he’s at last having to work for something and he just doesn’t know how?