The government has been guilty of being far too optimistic about the economy.
The Chancellor, Alistair Darling, predicted at the end of November last year in the Pre-Budget report that the economy would start to grow again in the third quarter of this year.
We've had Business Minister Baroness Vadera, the former economic adviser and close ally of Brown, claiming in a Lamont-esque way that she has seen the "green shoots" of recovery.
We've had Margaret Beckett, the Housing Minister, say that she has seen an "upturn" in the housing market.
And we have seen Tony McNulty, the Employment minister claiming "there's light at the end of the tunnel."
Labour condemns anyone who claims that British economy is going from bad to worse as "talking down the economy."
But critics of the government are NOT talking down the economy - they are pointing out the bleeding obvious.
More... Today we have been told that we are officially in recession. The economy contracted by 1.5 percent. Add that to the previous quarter's economic contraction of 0.6 percent and in just two quarters the British economy has shrunk by a huge 2.1 percent.
Unsurprisingly, both Darling and Gordon Brown are now shying away from repeating their ridiculous and hubristic growth forecasts of the PBR. Only the government thought the British economy would bounce bank so quickly. And remember the reason for their optimism - yes, the waste of money temporary VAT cut, their much trumpeted fiscal stimulus which is achieving sweet FA other than adding unnecessarily to our national debt.
Who now believes the economy will start growing again in the second half of this year?
Baroness Vadera sees "green shoots" of recovery on the day that 7,200 jobs were lost.
Beckett talks of an "upturn" in the housing market when the respected Ernst & Young Item Club warns that 2009 will see the biggest peacetime downturn in the economy since 1931, predicting a 16 percent fall in house prices this year and a further 6 percent drop in 2010.
And McNulty is the only person in the country outside of the Labour Party who can see "light at the end of the tunnel" after unemployment soars to close to 2 million, the national debt rises to the highest level for three decades and mortgage lending falls to its lowest monthly figure since April 2001.
Why is the government being so optimistic? Three reasons: 1) Confidence - it probably feels that if it talks up the economy then it could help improve economic confidence, and with it, recovery; 2) Electoral chances - Brown thought that if he could show the people that he was decisive and a man with a plan then they would back him, which they started to do for a couple of months but have since desserted ; and 3) Denial - a seeming unwillingless to accept economic reality and tell it how it is.
But this tragically comic. When all the evidence points to the economy getting worse and the recession getting deeper and longer, the government looks ridiculous by being so optimistic. This is not helping with confidence! The government is undermining what little economic credibility it has left and leaves them looking increasingly out of touch.
Brown, Darling and the rest of the Labour government are in denial. They seem so worried about what being honest will do to their electoral chances that they are ludicrously claiming to see "green shoots," "upturns," and "lights at the end of the tunnel" despite a barrage of worsening economic news.
If they cannot admit the true extent of our economic problems, how do they expect us to trust them that they have the answers to get us out of this recession?
The Chancellor, Alistair Darling, predicted at the end of November last year in the Pre-Budget report that the economy would start to grow again in the third quarter of this year.
We've had Business Minister Baroness Vadera, the former economic adviser and close ally of Brown, claiming in a Lamont-esque way that she has seen the "green shoots" of recovery.
We've had Margaret Beckett, the Housing Minister, say that she has seen an "upturn" in the housing market.
And we have seen Tony McNulty, the Employment minister claiming "there's light at the end of the tunnel."
Labour condemns anyone who claims that British economy is going from bad to worse as "talking down the economy."
But critics of the government are NOT talking down the economy - they are pointing out the bleeding obvious.
More... Today we have been told that we are officially in recession. The economy contracted by 1.5 percent. Add that to the previous quarter's economic contraction of 0.6 percent and in just two quarters the British economy has shrunk by a huge 2.1 percent.
Unsurprisingly, both Darling and Gordon Brown are now shying away from repeating their ridiculous and hubristic growth forecasts of the PBR. Only the government thought the British economy would bounce bank so quickly. And remember the reason for their optimism - yes, the waste of money temporary VAT cut, their much trumpeted fiscal stimulus which is achieving sweet FA other than adding unnecessarily to our national debt.
Who now believes the economy will start growing again in the second half of this year?
Baroness Vadera sees "green shoots" of recovery on the day that 7,200 jobs were lost.
Beckett talks of an "upturn" in the housing market when the respected Ernst & Young Item Club warns that 2009 will see the biggest peacetime downturn in the economy since 1931, predicting a 16 percent fall in house prices this year and a further 6 percent drop in 2010.
And McNulty is the only person in the country outside of the Labour Party who can see "light at the end of the tunnel" after unemployment soars to close to 2 million, the national debt rises to the highest level for three decades and mortgage lending falls to its lowest monthly figure since April 2001.
Why is the government being so optimistic? Three reasons: 1) Confidence - it probably feels that if it talks up the economy then it could help improve economic confidence, and with it, recovery; 2) Electoral chances - Brown thought that if he could show the people that he was decisive and a man with a plan then they would back him, which they started to do for a couple of months but have since desserted ; and 3) Denial - a seeming unwillingless to accept economic reality and tell it how it is.
But this tragically comic. When all the evidence points to the economy getting worse and the recession getting deeper and longer, the government looks ridiculous by being so optimistic. This is not helping with confidence! The government is undermining what little economic credibility it has left and leaves them looking increasingly out of touch.
Brown, Darling and the rest of the Labour government are in denial. They seem so worried about what being honest will do to their electoral chances that they are ludicrously claiming to see "green shoots," "upturns," and "lights at the end of the tunnel" despite a barrage of worsening economic news.
If they cannot admit the true extent of our economic problems, how do they expect us to trust them that they have the answers to get us out of this recession?
2 comments:
Lovely blog by the way. Stumbled across it from Iain Dale's DIary.
As for the Gov, they haven't got a spine between them to admit that they f***** up the country big time. They really think that we swallow all this rubbish on how they are getting back us on track.
Um, no, Labour, we don't believe a single word.
Terrible Tory Girl
Glad you like the blog!
Brown's been at it again warning about economic pessimism. What he doesn't realise is that his excessive optimism just makes him look a fool because it just does not tally with reality.
It's been good to see with the polls that voters are desserting Labour and returning to the Conservatives!
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