Thursday, 12 August 2010

"The single biggest challenge facing Britain" - oh really?

Soneone once say "Ringo's not the best drummer in the world, he's not even the best drummer in the Beatles".  I'd dispute that and not just because to me he is the voice of Thomas the tank engine.  Yes that shows my age...

But I would say something similar today in response to Baroness Warsi "The deficit isn't even the single biggest economic challenge facing Britain".  For most of us I would say jobs and growth are the single biggest economic challenge facing us, and we're Britain not the banks or Whitehall full of monetarist economists.

Yes the deficit has to come down, but the deficit this year is now projected to be smaller than the original forecast.  Under Labour's policies jobs were being created and growth was coming as figures out today show - the figures are better than I expected actually, and I was a fan of investing to grow!  

Yet looking at the impact of Conservative policies the bank of england are now downgrading forecasts future growth, consumer spending has started to slow and house prices have slightly fallen.  Why?  Well we're not stupid, people are worried about their jobs and the economy with Conservative policy of slash and burn.  

Ironically actually the best (and painless) way to cut the deficit is to increase growth.  This actually includes the so-called 'structural' deficit which is an estimate not an objective figure.  The estimate is hugely affected by what you assume to be the long term trend rate for growth... and guess what?  Conservative policies that harm growth will also lead to the structural deficit being higher, which will probably make them feel they can justify further cuts, which will damage growth further.  I can see where this is going...

Baroness Warsi is getting lots of coverage by being rude to the Labour leadership candidates but is' a smokescreen for the real news of the day - Labour policies are not only fairer but were working and Conservative policies are already causing both the Bank of England and the ordinary punter to be worried about the future.

To me this is a reminder along with national and local attacks on council housing, cutting investment in play areas, attacking social care (not to mention a foreign policy that seemingly involves pointlessly winding up a country that we need to keep onside for the sake or our troops and currently has a huge natural disaster on it's hands) should be a wake up call to every Labour member and supporter.