Tuesday, 26 January 2010

Recession? What Recession?

Pah, it's only been since the April-June quarter of 2008, but the longest recession since records began is expected to have officially ended in the final quarter of 2009. Or, at least, that's the script as the same was expected last quarter.

According to Lord Mandelson on Radio 5 Live this morning, we have had less house repossessions, less unemployment (about 850,000 jobs lost), had less company liquidations, had only 6% contraction of the economy and faired better than other G20 nations during the recession - heck, we have hardly sustained a scratch to our way of life. In fact, under the Conservatives of 20 years ago, the recession then lost 2 million jobs.

The difference, of course, is that we have a record budget deficit of £178bn and rising. That and the fact that we have made no cuts to public expenditure - in fact, we have spent like crazy and not lost any public sector jobs at all. We have spent a few hundred billion rescuing banks and we have printed £200bn of new money to buy our own National Debt. What we have done is created a FALSE economic situation and mitigated the effect of the recession on real things like public expenditure by spending and creating money that we didn't have - and we will all pay dearly for that over the coming years.

Gordon Brown believes he has made all the 'right decisions' in this crisis but the real reckoning has been staved off to a later date. He has created a dreamworld, a fantasy of where we actually stand so that he can try and win the election.

It's an artist's impression rather than a financial one as the creativity of Lord Mandelson is evident wherever we turn. The figures today are pretty meaningless in the context of how much this crisis has cost Britain and the taxpayers. The pain has been delayed and that will costs us all even more.

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