David Blanchflower: The Chancellor received plenty of warning
That was a big surprise. Not! Yesterday's figures came as absolutely no surprise to many of us who have warned for months that a double-dip recession was coming. I warned on 24 June 2010 that George Osborne's austerity budget "kills recovery at birth". I argued that "I am now convinced that as a result of this reckless Budget the UK will suffer a double-dip recession". It isn't as if our part-time Chancellor Osborne wasn't told. But he ignored the warnings by Robert Skidelsky, Paul Krugman, Martin Wolf, Ed Balls and others and even accused us of being "deficit deniers". Keynes turned out to be right. The shadow Chancellor has been vindicated.
Take care of growth and the deficit will take care of itself; sadly, reducing the deficit doesn't fix growth. Firms can save money by firing all their sales staff but then they shouldn't be surprised when sales fall. It seems that the Coalition consisted of "growth deniers" and assumed that slashing public spending would lead to a resurgence in the private sector. There was never any empirical support for such a proposition.
Blaming Europe doesn't wash as the main driver down has been the construction sector. It is time to cut National Insurance to zero on the young and give big incentives for firms to invest and hire, plus begin an enormous programme of infrastructure spending.
The Coalition still has no plan for growth. At the very least, it is time for a new Chancellor who has some clue about economics.
- 1 East 17 bandmember Brian Harvey in 'very desperate situation’
- 2 Is this bridge haunted by the ghost of nu rave?
- 3 Woman filmed launching racist tirade against men on the Tube for speaking in 'own lingo'
- 4 The West has it totally wrong on Lee Kuan Yew
- 5 Scientists have discovered a simple way to cook rice that dramatically cuts the calories
East 17 bandmember Brian Harvey in 'very desperate situation’
Vladimir Putin says Russia will fight for the right of Palestinians to their own state
Is this bridge haunted by the ghost of nu rave?
Woman filmed launching racist tirade against men on the Tube for speaking in 'own lingo'
Saudi Arabia says it won't rule out building nuclear weapons
Ukip supporters are 55 or older, white and socially conservative, finds British Social Attitudes Report
JK Rowling responds to fan tweeting she 'can't see' Dumbledore being gay
Jeremy Clarkson sacked live: Alan Yentob 'wouldn't rule out' ex Top Gear host's BBC return
David Cameron calls Labour 'hopeless, sneering socialists' while announcing 7-day NHS plans
The West has it totally wrong on Lee Kuan Yew
Revealed: Putin's army of pro-Kremlin bloggers
iJobs Money & Business
Negotiable: Recruitment Genius: To provide a prompt, friendly and efficient se...
Negotiable: Recruitment Genius: You will be the first point of contact for all...
£18000 - £24000 per annum + benefits: Ashdown Group: HR, Payroll & Benefits Of...
£35000 - £38000 per annum + benefits : Ashdown Group: A highly successful, int...