It’s difficult to credit that Osborne at Davos, with advance knowledge of the last quarter growth figures, could say “We have credibility and flexibility and have been using that flexibility”. His policies are credible with virtually nobody, are remorselessly rigid, and show not a glimmer of the flexibility needed. The latest growth figure of -0.3% is half-way to a triple-dip recession, previously unheard of, and even the IMF is voicing its dissent ever more loudly, along with so many UK business leaders who lionised him 2 years ago as the saviour of Britain.
What is really so extraordinary is that Osborne has no escape plan – just endlessly more austerity whilst waiting for something to turn up. If things were getting ever so slightly better, there might be a case (a bad one) for carrying on. But they’re not. Cameron said at Davos: “We’re paying down Britain’s debt”. He’s not, it’s growing, from £811bn in 2012 to £1,111bn now – a £300bn increase. So precisely what was all the agony of cuts for?
In the last week alone HMV and Blockbuster have gone belly-up, on top of the electrical retailer Comet, she shop Stead and Simpson, and camera specialist Jessops. With weak consumer demand in a flatlining economy Britain now has 19% of its shop premises boarded up, a proportion that can only rise significantly further while Osborne remains at the Treasury. The UK economy, in the worst recovery for a century, still remains 3% below its 2007 level, whilst industry is actually still 12% below and construction a devastating 18% below.
So why isn’t Labour blowing its fanfare for a completely alternative approach – the public sector-driven promotion of a jobs and growth strategy? Labour made one bad mistake in allowing the Tories to get away with the canard that the deficit is due to Labour Government over-spending, when actually the debt as a share of GDP was a mere 3% in 2007 and only soared to 11.6% in 2010 because of the colossal bank bailouts.
Now Labour is making an equally bad mistake in appearing to collude with the Tory/media/Establishment view that there is no alternative to endless cuts, however painful and counter-productive that might be. And perhaps worst of all, Labour keeps ducking the monstrous injustice of having the deficit debate concentrate on the poor (‘strivers’ versus ‘shirkers’) whilst letting the filty rich (even filthier and richer than Mandelson ever imagined) get away untouched. Labour, where art thou?