James Moore: Don’t get too excited yet, Mr Alexander

 

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The Independent Online

Outlook An email arrives from Danny Alexander, the Chief Secretary to the Treasury, or one of his people anyway. In it he’s at pains to point to the OECD’s latest forecasts, which everyone gets terribly excited about – even if they are about as reliable as Britain’s rail services.

They show that despite a decidedly cloudy economic outlook, UK plc is will be the fastest-growing developed economy this year and ought to be second only to the US next year.

This, Mr Alexander tells us, shows that the economic course mapped out by the Coalition is the right one. Well, perhaps. Mr Alexander is correct that in economic terms Britain is – more or less – back on its feet. Set against the eurozone (for example), UK plc looks like Google or Apple.

Unfortunately for him, until people start feeling it in their pockets, and until they start feeling confident that this will continue, they are unlikely to give the Government much credit. Wages are rising a little, but even if they start to consistently outstrip inflation it will still be years before we regain the levels enjoyed before the financial crisis of 2008.

And that’s a big if. It won’t have escaped the attention of some of Mr Alexander’s coalition partners that the eurozone remains mired in gloom. Before they start indulging in Schadenfreude, it’s worth remembering that the eurozone is still a major trading partner for this country, and its woes will not help us going into the choppier waters Mr Alexander talks about.

Unfortunately for him and the Liberal Democrats, even if those waters stay calmer than the doomsayers fear, and people start to feel richer, the junior coalition party is still unlikely to pick up the credit.

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