Friday 21st June
The economy may well be spluttering like an old car left out in the cold for too long. It is a bit tricky to get it moving again. The engine turns over a couple of times and makes encouraging noises but keeps dying again. You pump the accelerator with all sorts of curses and added fuel, you open the choke, but it floods the carburetor. You resort to pushing and bump-starting the thing and then jump in as the engine finally catches and it begins to move of its own volition.
The Government has tried almost everything; quantative easing – which is just printing money by any other name; ridiculously low interest rates – which may have actually had a counter effect; project Merlin – which promised so much and delivered so little; reducing corporation tax – which only helps those companies who were successful and had ridden the recession anyway. But actually there is only so much harm the Government can do, and the economy will emerge again. First in London, the real driver of the whole thing and slowly out to the other cities and lastly the countryside, and very last the old industrial heartlands in the North.
This has been a patchy recession anyway, here in London you wouldn’t have guessed it had happened at all, but in the Midlands and the North they can feel it in their bones as the wind of reality blows through their scanty clothes.
And what sort of a future do we foresee? Will the deficit ever be really closed, or will we live in a continuing cheese-paring world of economy drives and reduction in services, until we settle for a US style of very poor emergency provision and you pay for everything on top as you need it.
This all started when the financial system of Capital wound itself up and out of control but the end result could be the death of Socialism, brought about by the failure of Capitalism. Ironic?
But that in its turn may just trigger another revolution in the way we think about our whole relationship with money.