Has the British economy really recovered?
In his article in today’s “Guardian” newspaper, Robert Skidelsky, professor of political economy at Warwick University. writes:
“Five years after the onset of the financial crisis, Britain’s economy is still 3.5% smaller than it was in 2008. Growth may have spurted ahead of Britain’s competitors in the last quarter, but this comparison neglects the fact that it suffered a bigger fall in output and experienced a weaker recovery. The US, Germany and even France have surpassed their pre-recession peaks. Even according to the brightest forecasts, we will need another two years to make up the lost ground. And the picture is worse when we factor in population growth; GDP per capita is not expected to reach its pre-recession peak until 2018. We are only halfway through a lost decade.”
He concludes his piece:
“.. if I were in Labour’s shoes I would hammer home one simple message: the pain has not been worth it because the recovery is not secure. I would explain why printing money to offset cuts in public spending is the flakiest possible route to growth and is bound to land us in a fresh crisis sooner rather than later, and why an alternative policy of targeting growth and letting the deficit look after itself would be better for growth and for the debt.”