Thursday 25th April
I am writing this on Wednesday, but you will be reading it the day the OBR publishes the latest quarterly GDP figures. So, I really do not know yet the extent of the damage, though I suspect that George Osborne does, and will be preparing his defence. We had a 0.3 percent contraction in the three months to Christmas, and to be honest the signs are quite mixed as to whether things are improving or not. Technically if the economy contracts again we will have a triple dip recession, for the first time in our be-knighted history.
Not that it actually matters either way; even the most positive of pundits are predicting only 0.1 or 0.2 % growth. To be quite honest these figures are only provisional and are like a snapshot of a rapidly moving picture, and will be revised up or down a couple more times before settling down and become regarded as some sort of accurate.
My gut feeling is that George will be lucky and will escape a Triple Dip. He was incredibly lucky with the deficit figures, again coming in just a sliver lower than last year. The importance is far more political than economic. But the really important factors are those looking ahead. The euro-zone is still in crisis, and looking to at least another year of flat or negative growth. America is slowing down too, as is China, although we would all die for figures above 5% growth.
Or would we? It is surely a sign of a very unbalanced World that there are such variances in our fortunes. Some economists are now looking at decades of stagnation in the West, which puts all of our political parties in trouble, as they all insist the way out of our troubles is to get back to growth. What if growth is simply not achievable anymore, and the best we can hope for is bumping along the bottom? Does there come a point when debts become too high and major countries cannot afford to repay the interest anymore? Or maybe a completely new way of looking at things will emerge.
The other far more worrying statistic is that in one year the number of people resorting to free food banks had trebled. And the changes in benefits will only exacerbate this. It is all very well for politicians to pull long faces and shake their heads at the failures of the party opposite. Does anyone have the solution to how to distribute fairly what limited wealth we still have?