Carving a giant didn't make spring bloom

Nothing is less logical and more potent than the umbilical connection between political popularity and economic performance. The Great Fact of the moment, the recovery, is sending magic juices through ministerial veins. From John Major down, they already seem jauntier, less drawn, more pugnacious. They grin, and slap each other. Mr Major is out and about, selling himself and his optimism in a series of speeches.

We always knew it was going to happen, but it is worth pondering, even so. For the logical leap that connects economic recovery to political recovery is a wondrous thing. After all, the recovery is not the result of ministerial volition - only a few unreconstructed Stalinists now believe that economic success is brought about by an act of political will. Mr Major never had a five-year economic plan, nor could he have had. He disclaimed responsibility for the recession and cannot, straight-faced, assume credit for the recovery.

Nor, to be fair, does he. Not quite. Last night, he told the Freight Transport Association that 'we said low inflation would create the climate for recovery. We have driven inflation down. And recovery is following as we said it would'. This is rather like: 'We said that carving a picture of a naked, erect giant on the side of the hill would create the climate for spring. We carved it. And spring is coming, as we said it would.'

Granted, an anti-inflationary policy is rather more useful than a chalk drawing of a giant, but the Prime Minister's leap of logic is still a little hard to take. Keeping inflation low during the next part of the cycle, the upswing, is indeed essential to a sustained recovery. It will be much harder to achieve, too. But to say that the recovery has been caused by low inflation is going it a bit.

Black Wednesday's impact on interest rates has more to do with it, a policy failure which is now treated, with hardly a blush, as a policy success. In his recent economic speeches, Mr Major has regularly referred to the joys of a competitive exchange rate and the lowest interest rates in the European Community, as if they were brought about by deliberate Treasury policy, instead of its collapse.

All the above is a reasonable antidote to the mood of triumphalism sweeping the Cabinet. The inbuilt amplification of our political system tends to produce wild mood swings. But nothing obliges the rest of us to take them too seriously. Watch, for instance, for shrieks of excitement in the next few months about the comparative performance of the British, Continental and Japanese economies. But the others entered the recession long after us and we will not be able to compare the length and depth of the experience for a few years. Until we can, treat astonishing statistics about Britain and its competitors as no more than jolly freaks.

The serious economic debate will carry on at a different level, only occasionally bisecting the simplistic whoops of congratulation and abuse about the business cycle that pass for political economy on the floor of the Commons. The real questions are whether ministers have the guts to get government borrowing significantly down during the upswing - to keep inflation low - and to pursue longer- term supply-side policies to boost exports. This will mean tough decisions on middle-class subsidies.

On all of these, as it happens, the signs are fairly promising. If what Mr Major does on these issues at all matches what he is now saying, there is a possibility that the growth of output being celebrated this week will turn slowly into real and sustainable economic success. His bitter experiences in the past two years, the hangover of earlier mistakes, should have equipped him to avoid similar errors again. When he became Chancellor in November 1989, he said: 'I strongly supported Nigel Lawson's policies while I was at the Treasury as Chief Secretary and I see no reason to change my view now.' I don't suppose he would say the same today.

Mr Major has been lucky as a politician - in his breaks, in the crises that brought him to power, in his opponents. But he has, up to now, not been particularly lucky as a Prime Minister. That may be changing. The slow, steady emergence from recession that Britain needs would fit in quite well with the imperative of holding off any election until the Boundary Commission changes have become law, reinforcing Mr Major's innate suspicion of boom time.

Meanwhile, there is no evidence that the big social shifts which Labour has been struggling against have gone away. A demographic shortage of teenagers entering the labour market may, as Gavyn Davies explained in the Independent yesterday, speed the fall in unemployment. But it may also reinforce the natural conservativism of an ageing population living on a fixed income and, like Mr Major, intolerant of inflation.

These are the people who will increasingly dictate the politicians' rhetoric, making it more difficult to raise VAT on basic foodstuffs, for instance, or to erode pensions, but more easy to attack subsidies such as mortgage interest tax relief, which mostly affect younger voters. Older voters probably react, on average, better than younger ones to Mr Major's increasingly nostalgic rhetoric.

Today's triumphalism may be hard to justify. Labour and the Liberal Democrats have every right to mock. But even in a world where politicians have less influence on economic performance than they have ever done, the golden glow of growth still surrounds them like a halo. As they deride this late recovery, the Opposition should shudder a little, too.