Tag Archives: Wren-Lewis

Johnson is steering us towards another – more dangerous – Covid wave. And he is deliberately distracting us from it

The only sensible course of action: but it seems thousands more UK citizens may have to catch Covid-19 – and may potentially die – before the tribal Tory electorate accept this truth.

It seems we have a prime minister who is not only ignoring all the evidence that another wave of Covid-19 is coming – he is steering us into it while trying to distract us from it.

How is he being allowed to do this irresponsible – homicidal – possibly genocidal thing without a whisper against it from the mass media that govern the opinions of most of us?

Well, that’s easy. He had a “secret” wedding last weekend and got them all to make a big fuss about that instead.

In fairness, Keir Starmer tried to tell us all that the delta variant of Covid-19 could cause a new wave of infections and deaths, worse than in the winter. Did you even know that?

The latest Mainly Macro blog from Professor Simon Wren-Lewis has set out some of the most damning details in what I think is an effective way. Consider [boldings mine]:

“We are at the beginning of a new COVID wave. Yet rather than stop further relaxation of the lockdown (not doing stage 3), this government carried on regardless. It reduced lock down restrictions because the PM and the rest of the cabinet were prepared to see another wave of cases, hospitalisations and a fair number of deaths in the UK.

“When cases in another country start growing rapidly, you quarantine in hotels people coming from that country. If they have existing variants of concern, you do the same. You do not wait because the PM has a state visit planned hoping things will get better.

“Once a variant of concern enters the country, you direct all resources to isolating that variant and preventing spread. You do not persist with a failed test and trace system because it is politically embarrassing to overhaul it. You make payments to those asked to isolate automatically.

“The new variant is spreading rapidly in schools in areas where it is concentrated, so what did the government do? It told people in secondary schools they didn’t need to continue wearing masks.

“We know the Indian variant spreads a lot more rapidly than anything we already have, and it has become the dominant form of COVID in the UK in mid-May. It is now the dominant form in most regions. We also have evidence that one dose of vaccine offers less protection against this variant than against other forms of COVID, but two doses does offer a similar amount of protection. Around half of the UK adult population has had two doses of vaccine, meaning the other half have one or none at all. That, according to SAGE projections available before the government went to stage 3, could cause a wave of hospitalisation similar to what happened in the New Year.

“The number of deaths should be less than past waves, but we are still talking about many people dying who didn’t need to die. But hospitals are only just beginning to reduce the backlog from other diseases like cancer created by previous COVID waves, and another wave of hospitalisations will reverse that process, leading to yet more deaths from non-COVID causes.

“The Prime Minister cannot know that things will not be so bad in this new wave. He is following dates rather than the data, and yet again not following scientific advice, because he is more interested in giving people the freedom to spread the virus to others. 

“A new wave is also highly likely to stop the UK economic recovery in its tracks.

“A wave in cases with most people vaccinated is about the most irresponsible thing you could possibly do. It invites new variants to be created that are far better at bypassing the vaccines we have. The more cases you allow when most of the population is vaccinated the greater the chance that a variant will emerge that vaccines are far less effective against.

Much of the gains of the vaccination programme could be lost, and we will have to start all over again.

“Cummings’ message was that this Prime Minister is exactly the wrong person to be leading us in this pandemic, and most of the media chose to ignore his warnings.

“Will the broadcast media start holding this government and its Prime Minister responsible for past and possible future deaths? Will voters finally realise that they are being lied to by this government all the time, and their lives and livelihoods are at risk as long as Johnson continues as Prime Minister?”

Sadly, I think we all know the answer to both of those questions.

Source: mainly macro: Worried about another COVID wave? Here are some pictures of Johnson getting married again

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The Tories have run the UK into the dirt and Labour needs to ram the point home. Here’s how

Money, money, money: Boris Johnson thinks it’s for handing out to his party’s friends and donors rather than for investing in the UK economy. Labour needs to explain why his Tories, despite their false claims, are silly with our cash.

It’s no secret that Labour under Keir Starmer is failing to make the right points against Boris Johnson’s lying Tories.

Some of the worst falsehoods in the Tory narrative are about the economy – but, as Mainly Macro‘s Simon Wren-Lewis mentioned (on which I expanded), Labour has consistently failed to address them in any meaningful way.

Professor Wren-Lewis has followed up his article with a new piece suggesting possible pressure-points Labour could attack.

I think he’s wrong to suggest Keir Starmer should do so, as Starmer is unlikely to want to – or indeed to be around for long after the local elections next month, but the ideas are sound and whoever becomes the new leader should certainly consider them seriously. They are:

1. Austerity – Conservatives from David Cameron onwards claimed austerity was a vital response to the economic crisis of 2008 onwards; in fact it harmed the economy.

Labour should assert – forcefully – that there was no debt crisis and the economy needed stimulation rather than starvation. Tory austerity not only delayed any recovery, but diminished it so that wages are now – perhaps permanently – lower.

So the Tories attacked the UK’s economic well-being in order to impoverish the wider population.

2. The second wave of Covid-19 was much worse that it could have been because Tory Chancellor Rishi Sunak resisted an early lockdown.

This delay meant not only that many more lives were lost to the virus than ever needed to be, but also that the lockdown that eventually had to be imposed had to be much longer.

So the Tories attacked the UK economy – and caused many thousands of unnecessary deaths – by failing to lock down strongly and early when cases started rising.

3. Brexit has created a bureaucracy mountain that has hit exports and many firms very badly. I suspect Professor Wren-Lewis wrote his piece before the extent of the violence in Northern Ireland became clear to him, otherwise he could have mentioned this.

It means the Tory-created bureaucracy has harmed the UK economy in a way that has actually re-kindled the Troubles in Northern Ireland after 23 years of hard-won peace.

Professor Wren-Lewis goes on to state that Labour avoids the argument because party leaders know the Tories will answer it with claims about “overspending” by the last Labour government.

But these claims have always been false:

Prof Wren-Lewis also suggests a few responses to the usual attacks we can expect from the Tories and their lackeys in the mainstream media. For example:

No, the Coalition government’s austerity measures did not save the UK from a financial crisis. The Conservatives have demonstrated, many times now, that the Bank of England will create any money needed to cover the UK’s debts, if the markets won’t or can’t do so. Risk of inflation is negligible for reasons we’ve seen in action in the Covid crisis.

No, it isn’t reasonable to suggest Labour was partly responsible for the damage the crash of 2008 onwards caused by pointing at its failure to regulate the banking sector. At the time, the Conservatives were demanding even less regulation, meaning they would have caused more harm to the economy if they’d had the chance.

And no, Labour did not “overspend”. That party left office in 2010 with a record deficit of more than 10 per cent of GDP, but only because of global economic events and measures taken to prevent job losses after banks started collapsing. After 11 years of Conservative rule the UK has a record deficit of 17 per cent of GDP – because of “overspending”? Arguments that Labour would also have introduced austerity can be overcome by pointing out that the party’s critics can’t criticise the party for both over- and underspending.

Finally, Prof Wren-Lewis suggests that the argument about Tory economic incompetence may be wrapped up in a larger attack on Tory incompetence in general:

Boris Johnson and his Tories have been incompetent in handling Covid, running the NHS, looking after law and order, and handling public money.

Their only success has been in handing public money to their personal friends and funders.

Put it like that and Labour is on a path to electoral victory again – if that party can devise policies that capture the public imagination (Jeremy Corbyn was very good at that) and defend them against Tory attack lines (he wasn’t quite so successful there).

But Keir Starmer won’t put it like that because he simply doesn’t have the grit for it. That’s why we have to wait for the next Labour leader and hope that they will.

Source: mainly macro: Labour should start contesting the Tory record in running the economy

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No, Robert Peston, Osborne was WRONG to impose austerity. Stop distorting the facts!

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The BBC’s Tory economics editor Robert Peston is clutching at straws again.

He’s trying to persuade us all that everything we thought we knew about the UK’s economy during the Coalition Parliament was wrong, and that growth was much stronger than we thought. He is being economical with the truth, it seems.

He writes: “The ONS … says that the economy grew 1.5% in the general election year of 2010, then 2% after austerity bit in 2011 – revised up by the ONS from 1.6% – and then 1.2% in 2012, when the eurozone’s economic crisis imposed maximum pain on us.

“The previous picture, of austerity reducing growth from 1.9% in 2010, to 1.6% in 2011, to 0.7% in 2012, has been magicked away by the official statisticians.

“And they have also revised up their estimate of growth for 2013 from 1.7% to 2.2%.

“If these statistics are more reliable than the last lot, a particular school of Keynesian economists may choose to re-examine their contention that only a fool or a liar would say there is a legitimate debate about whether George Osborne’s policies were good or bad for the recovery.”

One of that school of Keynesian economists has hit back – hard. According to Professor Simon Wren-Lewis, Mr Peston’s argument is “just nonsense: complete and utter nonsense.”

He responds: “This ‘particular school’ has never based their assessment on observing what is still the weakest UK recovery since anyone can remember and looking for something to blame. They based it on what macro theory and the great majority of empirical studies tell us would be the impact of the fiscal austerity that happened. At the conservative end of such assessments is the OBR, who calculate austerity reduced GDP growth by 1% in each of the financial years 2011 and 2012. Estimates of this kind are completely independent of data revisions for one period in one country. We might doubt such estimates if they implied that without austerity we would have had implausibly rapid growth, but for this recovery they do not.”

This means that it doesn’t matter how well the ONS or Mr Peston says the economy performed – the simple fact that George Osborne had imposed austerity on the UK (unnecessarily) means growth was restricted by at least one per cent in the years he mentions.

Prof Wren-Lewis goes on to point out that the UK’s growth performance – even with these revisions – is still terrible because Peston has not taken population growth due to inward migration into account: “You really have to look at GDP per head to make comparative statements about this recovery.

As the ONS point out, this new data still shows that only in this year has GDP per head exceeded its pre-recession peak. Assuming recent data revisions have not changed this, average growth in GDP per head between 1955 and 2008 was about 2.25%. Any recovery from such a deep recession should have seen growth rates well in excess of this.

“Instead the revised data give us 1.1% growth in 2011, 0.5% in 2012, 1.5% in 2013. Only by 2014 had we got near the long term average growth rate. This is still an absolutely terrible performance for a recovery.”

Prof Wren-Lewis goes on to suggest that Peston might be saying as much himself if the Tory Government were not “breathing down the BBC’s neck”. The point that BBC political coverage is being distorted by Tory influence is a very good one, as anybody who has seen Question Time recently will know.

In fairness to Peston, he does point out that any extra economic growth did not translate into higher tax revenues for the government. Where did that money go (if it doesn’t exist only in the minds of ONS statisticians and Mr Peston)?

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When is Chuka going to stop backstabbing Labour?

Blue is the colour (of this man's politics): Chuka Umunna should be in the Conservative Party.

Blue is the colour (of this man’s politics): Chuka Umunna should be in the Conservative Party.

It seems Mr Umunna is even ready to sink his own credibility in order to undermine the party he still claims to represent.

He has written an article in The Independent which Oxford University macroeconomist Professor Simon Wren-Lewis has rubbished in his Mainly Macro blog.

This Writer’s only criticism is that Prof Wren-Lewis headlines his article with a claim that it is a sign of “Labour’s growing macroeconomic illiteracy” – when it is far more likely to be a sign that Chuka should cross the floor and join the Conservatives he most closely resembles.

Chuka wrote: “To be running a deficit in 2007, after 15 years of economic growth, was still a mistake. My party’s failure to acknowledge that mistake compromised our ability to rebuild trust in 2010 and in 2015. If a government can’t run a surplus in the 15th year of an economic expansion, when can it run one?”

This is the Tory line in a nutshell – and nonsense. Mainly Macro‘s response: “What Umunna is saying here is much the same as George Osborne’s proposed rule: in normal times when the economy is growing run surpluses. But Osborne is saying that in the context of the current debt to GDP ratio of 80% of GDP. Umunna is implying that policy still made sense back in 2007 when the debt to GDP ratio was below 40%, the output gap was thought to be small and no one was expecting a global financial crisis.

“I cannot remember anyone before 2008 suggesting Labour’s debt limit should fall over time. Yet Umunna says the mistake was so serious it helped lose Labour two elections.”

In other words: What a load of rubbish.

“I would love to know who the economists are that gave Umunna the advice that led to this article,” writes Prof Wren Lewis. Who says anybody did?

To prevent claims that he is over-exaggerating a couple of sentences from a larger article, the Professor again quotes Chuka: “Reducing the deficit is a progressive endeavour – we seek to balance the books because it is the right thing to do.” This claim – that it is “the right thing to do” is straight out of the Tory phrasebook.

The response: “Would he give the same advice to UK businesses: refrain from borrowing and focus on paying back your debt? Somehow I think not. The Conservatives have a kind of excuse for deficit fetishism – it is a useful device for shrinking the state. That excuse should not apply to senior Labour figures.”

This Blog can see little future for Labour if a politician with so much sympathy for Conservative policies – and so little understanding of economics – remains on Labour’s front bench. Chuka has had his day.

It’s time he chucked it in.

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A fact-check for silly Cameron apologists

Media manipulation: The Sun, and the Scottish Sun, supported both the Conservatives and the SNP on the same day. Did it affect the results in Scotland and the rest of the UK?

Media manipulation: The Sun, and the Scottish Sun, supported both the Conservatives and the SNP on the same day. Did it affect the results in Scotland and the rest of the UK?

Here’s a piece in the New Statesman that is worth debunking straight away. Entitled 10 delusions about the Labour defeat to watch out for, it makes assertions that suggest to This Writer that it is author Ian Leslie who’s been having dodgy visions.

Let’s focus on three:

“1. THE MEDIA DID IT

“No left-wing account of this defeat will be complete without a reference to the Tory press (bonus drink for “Murdoch-controlled”) and its supposed inexorable hold over the political psyche of the nation. Funny: the day before the election everyone decided The Sun was a joke and nobody reads newspapers anyway.

“3. CLEVER TORIES

“It will be said that the Tories, in their ruthlessly efficient way, pinned the blame for austerity on Labour and Labour allowed it to stick. Clever Tories. Few will mention that the Tories were, for the most part, a hubristic and directionless shambles, divided amongst themselves, the authors of several howlingly stupid own goals that would certainly have sunk them had they not got so lucky with their opponent.

“5. THE SNP STOLE OUR VICTORY

“It is true that nobody, but nobody, foresaw the SNP tidal wave. But it’s not true that Labour would have won or even done OK without it. Labour saw a net gain of one seat from the Tories in England. One. Seat. One seat, in an election where everything favoured them. One seat, after five years of a shabby and meretricious government making unpopular decisions and a third party that virtually donated its voters to them. An epic failure.”

Firstly, nobody is blaming the media entirely for voters’ insistence on self-destructively supporting the Tories. The media helped hammer the Tory messages home, by amplifying Cameron’s statements and ignoring or vilifying Miliband’s. After a while – and in accordance with Goebbels’ (Cameron is a big fan of Goebbels) claims about The Big Lie – people start believing the claims they see most often.

This is why Conservative claims must be challenged at every opportunity from now on. Whenever a Tory puts forward a policy in the papers, on the Internet and social media or wherever, let’s try to put the questions in front of them that deflate their claims. It has been said that a lie can go around the world before the truth gets out of bed; let’s kill The Big Lie before it can get its shoes on.

Secondly, nobody This Writer knows is saying anything at all about “ruthlessly efficient” Tories. This lot are about as stupid as they come. It’s just a shame – and this was a constant problem for bloggers like Yr Obdt Srvt – that nobody in the Labour leadership saw fit to counter the silly Tory claims with a few ounces of fact. Therefore we must conclude that, not only are the Tories monumental imbeciles; most of Labour were, as well.

This is why the Conservative Party as a whole should be undermined at every opportunity. Whenever they make bold claims about their record – especially against that of the last Labour government – let’s put up a few embarrassing facts to pull the wool out from under them.

Finally, nobody but the SNP and its supporters is making any claim that the SNP’s “tidal wave” – alone – stopped Labour. As This Writer has already mentioned (and the election result was only known yesterday), the Conservative Party used the threat of an SNP surge to put fear into Middle England that “loonie-left” Labour would ally with these crazed Caledonians, to the detriment of the nation. Amazingly, people were gullible enough to believe it.

But you don’t have to take This Writer’s word for it. Here’s Professor Simon Wren-Lewis, from his latest Mainly Macro article [italics mine]:

“Why do I say Cameron is lucky? First, largely by chance (but also because other countries had been undertaking fiscal austerity), UK growth in 2014 was the highest among major economies. This statistic was played for all it was worth. Second, although (in reality) modest growth was not enough to raise real incomes, just in the nick of time oil prices fell, so real wages have now begun to rise. Third, playing the game of shutting down part of the economy so that you can boast when it starts up again is a dangerous game, and you need a bit of fortune to get it right. (Of course if there really was no plan, and the recovery was delayed through incompetence, then he is luckier still.)

“The Scottish independence referendum in September last year was close. 45% of Scots voted in September to leave the UK. One of the major push factors was the Conservative-led government. If Scotland had voted for independence in 2014, it would have been a disaster for Cameron: after all, the full title of his party is the Conservative and Unionist Party. That was his first piece of Scottish fortune. The second was that the referendum dealt a huge blow to Labour in Scotland. Labour are far from blameless here, and their support had been gradually declining, but there can be no doubt that the aftermath of the referendum lost them many Scottish seats, and therefore reduced their seat total in the UK.

“Yet that led to a third piece of luck. The SNP tidal wave in Scotland gave him one additional card he could play to his advantage: English nationalism. The wall of sound coming from the right wing press about how the SNP would hold Miliband to ransom was enough to get potential UKIP supporters to vote Conservative in sufficient numbers for him to win the election.”

While I’m not convinced about the UKIP claim (UKIP’s vote share enjoyed the largest increase of any of the parties in Thursday’s election) the rest rings true.

You have already heard an awful lot of hogwash about the reasons for the Conservative Party’s slim win. Don’t believe everything you hear.

It’s long past time that facts and evidence were reintroduced to politics.

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Vox Political vindicated on the economy

The Conservatives' latest negative campaign advert: The Tories seem to think they are the only party who should be allowed to steal the cash from poor people.

The Conservatives’ latest negative campaign advert: The Tories seem to think they are the only party who should be allowed to steal the cash from poor people.

Twice, in a matter of days, Vox Political‘s findings on political issues have been supported by the evidence of a scholar.

Today, the Mainly Macro blog written by Professor Simon Wren-Lewis, who teaches Economics at Oxford University, supports This Writer’s argument that the so-called economic recovery, that began in 2013, had little or nothing positive to do with the Coalition Government or George Osborne’s policies.

“The idea that austerity during the first two years of the coalition government was vindicated by the 2013 recovery is so ludicrous that it is almost embarrassing to have to explain why,” he writes.

“Imagine that a government on a whim decided to close down half the economy for a year. That would be a crazy thing to do, and with only half as much produced everyone would be a lot poorer. However a year later when that half of the economy started up again, economic growth would be around 100%. The government could claim that this miraculous recovery vindicated its decision to close half the economy down the year before. That would be absurd, but it is a pretty good analogy with claiming that the 2013 recovery vindicated 2010 austerity.”

That’s right. George Osborne did huge harm to the economy when he imposed austerity in 2010, choking off Labour’s recovery. It is senseless for him to claim that easing off on that policy has created an economic miracle. As this blog has repeatedly stated, any economic recovery enjoyed by the UK has had nothing to do with the actions of the Coalition Government.

It is important to remember that the Tories intend to impose even deeper austerity if they win the election next month, causing catastrophic harm to anyone who isn’t in the richest 10 per cent of the population.

But why do this at all? What was the point of it?

A commenter to this blog’s Facebook page put it very well only today. Tracey Wilkinson Clarke wrote: “Corporations and capitalism [were]crashing…the banking crisis was created … as a reason to bring in austerity measures to feed the money back up to the few.” This opinion is supported by an article on this blog at the time.

It is also supported by the Conservative Party’s most recent anti-SNP campaign advert. Following on from David Cameron’s overheard comment on television last week, that Alex Salmond was a pickpocket, the advert has an image of the SNP candidate reaching towards a member of the public’s pocket, with the tagline, “Don’t let the SNP grab your cash.”

It is Conservative Party policy to do exactly that – and hand it over to the very rich in the form of tax breaks (both personal and business-orientated), tax avoidance, lucrative public ‘service’ contracts, and shares in privatised utilities.

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The ‘Labour overspent’ lie debunked – again

It’s astonishing. Right-wing politicians, journalists and members of the public are still – still – pushing the myth that the financial crisis and recession of 2008 onwards was caused by the last Labour government overspending, being “profligate”, “not fixing the roof while the sun was shining”.

This Writer heard it twice on Thursday evening alone – from the Tory candidate at a local hustings event (although, bearing in mind that Brecon and Radnorshire’s Conservative candidate Chris Davies has all the intelligence of a farm animal, this is not surprising) and on the BBC’s Question Time, from William Hague (who was probably one of the Tories who invented this particular tall story in the first place).

Professor Simon Wren-Lewis wrote illuminatingly on the subject in his Mainly Macro blog, saying that the Coalition government wanted people to believe a myth that it rescued the economy from an impending financial crisis, but this could not be squared with the fact that the very large government budget deficit in 2010 was largely the result of the recession.

Therefore, he stated, it was important for the Conservatives and Liberal Democrats “to push another explanation for the large deficit: that it reflected the profligacy of the previous government.

“Economic journalists know full well this is a myth. Yet it is a myth repeated on countless occasions by the coalition parties, and by journalists working for the partisan press. On one occasion one of these journalists tried to rubbish a post where I wrote it was a myth, and I hope learnt to regret the experience.”

As ever, with a big lie (and here on Vox Political we have seen this very often in regard to the SNP’s claims) there is a nugget of truth. Here, it is the criticism that Gordon Brown was not as prudent as he might have been in his pre-recession budgets. Professor Wren-Lewis writes: “That memory is both correct (both the IFS and NIESR made that criticism) and the criticism is valid… This is the half-truth that sustains the myth.

UK public sector net debt

“But mild imprudence is not profligacy. We can see that by looking at another chart, for the debt to GDP ratio. Profligacy would imply a rapidly rising ratio, but this ratio before the recession (37% in 2008) was below the level Labour inherited (42% in 1997), and below its fiscal rule figure of 40%. No profligacy there.”

More prudence would not have helped because, “as Vicky Pryce, Andy Ross and Peter Unwin state in their book ‘Its the Economy Stupid: Economics for Voters’ (which I happily recommend, and which in its initial chapters covers much of the ground of this series): ‘The elimination of the UK’s structural deficit [under Labour before the recession] would not have been even a sticking plaster in the face of the haemorrhaging of the finance sector’s jugular’.”

The professor also adds that the Tories argued for less financial regulation before the collapse, and opposed Labour’s measures to moderate the recession in 2009.

In addition, this blog can add a recent response to a commenter, which ran thus: Labour didn’t ‘recklessly spend money we don’t have’ [as the commenter had claimed]. Labour ran the economy very well – as reports from such leftie strongholds as Oxford University have shown.

The global economic crisis that started in the US subprime housing market affected the UK deeply, and the Labour government of the time was forced to take action to prevent a run on the banks that would have deprived most people in the UK of their bank account savings – including people criticising Labour now.

The narrative about Labour profligacy is a fairy tale made up by the Conservative Party … in order to fool voters into supporting that party so it could win the 2010 election. Even then, it didn’t work and the Tories had to go into a coalition with the Liberal Democrats. They anticipated this, and hedged their bets by making a deal with the Lib Dems in March 2010, two months BEFORE the election (this information is from Five Days To Power, a book on the subject by Rob Wilson, Conservative MP for Reading East).”

The issue is not Labour profligacy; it is Conservative (and Liberal Democrat) dishonesty.

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‘The SNP’s Tory-LibDem second term’

Big Mouth strikes: Stewart Hosie was desperate to wrongly lay blame for the economic crisis on Labour. Now he's being told that every vote for the SNP could help enable a Conservative-Liberal Democrat second term.

Big Mouth strikes: Stewart Hosie was desperate to wrongly lay blame for the economic crisis on Labour. Now he’s being told that every vote for the SNP could help enable a Conservative-Liberal Democrat second term.

SNP mouthpiece Stewart Hosie should have known better than to try to score political points with information from Oxford’s Professor of Macroeconomics.

After Professor Simon Wren-Lewis (author of the Mainly Macro blog) confirmed to The Conversation that Nicola Sturgeon’s claims about austerity* were correct, “with no qualifications” (meaning he would not correct her on any aspect of it), Hosie spouted the following in a press release:

“Professor Wren-Lewis reflects what many other experts and indeed members of the public know all too well – that Tory/Lib Dem austerity has done deep harm to the country’s recovery from the Labour recession.” [Italics mine]

Here’s the response from Prof Wren-Lewis (bolding mine):

“Oh dear – ‘the Labour recession’. That would be the global financial crisis that originated with US subprime mortgages! Calling this the Labour recession is just stupid, and is something I would never say. It is very unfortunate (and I hope it is just a misfortune) that Stewart Hosie appeared to suggest that I had said or implied that. Whatever the intention, it indicates that at least some in the SNP are still in the business of making highly misleading statements to advance their cause.

“While on the subject of the SNP and this election, let me make one final point, just in case any prospective SNP voters read this. In the quite likely event that the Conservatives get more seats than Labour, but less seats than Labour and the SNP combined, in a situation where either side would need LibDem support Nick Clegg has made it clear he will talk to the Conservatives first. That will almost certainly lead to the current coalition government continuing. Clegg’s reasoning for doing this makes little sense, but the SNP cannot influence Clegg’s decision, and I suspect nor can his party even if they were minded to.

“If that comes to pass, then every vote for the SNP rather than Labour that loses Labour seats becomes a vote to continue with the current government. That is not an opinion, but a factual statement. So, to be consistent with his own logic, I think Stewart Hosie would have to call this election result the SNP’s Tory-LibDem second term.”

If we’re honest, this means Nicola Sturgeon really does need to ask England and Wales not to vote Tory, as this blog stated a few days ago.

Any questions (or indeed squeals from the SNP cultists in our readership)?

*She had said: “In the last five years, austerity has undermined our public services, lowered the living standards of working people, pushed more children into poverty and held back economic growth.”

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Tory economic policy has cost every household at least £4,000 – and aims to take more

Bottom of the class: George Osborne based his 'Long-Term Economic Plan' on a spreadsheet error by American economists. [Image: Gaianeconomics]

Bottom of the class: George Osborne based his ‘Long-Term Economic Plan’ on a spreadsheet error by American economists. [Image: Gaianeconomics]

If you’re thinking, “That headline isn’t news”, you’re right.

It is, however, the main point troubling Professor Simon Wren-Lewis in his latest Mainly Macro blog article. He states that Tory chancellor George Osborne started out in a similar position and with a relatively similar policy to Labour’s Gordon Brown, but caused huge damage to household finances, whereas Brown did not.

“The answer, of course, is that the … contexts were different,” writes the learned professor. “Osborne’s austerity happened when the economy was just starting a recovery from a deep recession, and interest rates were at their then Zero Lower Bound (ZLB) of 0.5%… When interest rates are at the ZLB, monetary policy cannot counteract the negative impact of fiscal austerity on output.”

In other words, with austerity shrinking the economy, nothing else Osborne did would have stopped your wages from shrinking too. It is entirely possible that Osborne was perfectly aware of this.

This is how George Osborne probably looked after the fire in his pants caused by his incessant lying about the EU’s £1.7bn bill burned away the rest of his suit. Note that his briefcase is still empty of policies and all he has to offer us is the carrot of false promises [Image: Kaya Mar www.kayamarart.com].

George Osborne: His briefcase is still empty of policies and all he has to offer us is the carrot of false promises [Image: Kaya Mar www.kayamarart.com].

Yet he is planning an even bigger austerity squeeze on your incomes if the Conservatives form a government after this year’s election.

Professor Wren-Lewis dismisses the possibility that Osborne does not understand what he has been doing: “A much more plausible explanation for his actions were that the macroeconomic risks were understood, but were put to one side for political and ideological reasons.

“First the possibility of hitting Labour with a populist concern about the deficit was too great a temptation to resist for a Chancellor for whom political tactics are everything. Second, austerity was a means of implementing an unpopular policy of reducing the size of the state by the back door.”

He adds: “Now you may cynically say that in a contest between economics and politics/ideology, politicians will always choose the latter. However much that is true or false, when that choice costs each household at least £4,000, it would be very strange if that politician survived the judgement of the electorate.”

Perhaps so – but he and his party are banking on the electorate being too ignorant of the facts to realise this. That’s why I put it in the headline.

Campaigning in the centre of a small Mid Wales town yesterday, This Writer asked one group of young people (in their twenties or thereabouts), who quite clearly had limited means, which way they were going to vote. They ignored the question and walked on for several paces, then one turned around and, raising his fist to the air, yelled, “Conservative all the way!”

George Osborne is relying on people like this for his party’s survival.

We have to foil him by educating them.

It is a task that won’t end after the election; in fact, it is a task that may not end in our lifetimes.

But it is the only way to protect ourselves from continual exploitation by an entitled class of layabouts who expect us to do all the work while they have all the privileges handed to them on a plate.

Please share this article if you agree.

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The recession would have been worse if the Conservatives had been in power

150406mervynkingonrecession

‘Killing Britain’s interpretation of Mervyn King’s comment on the recession.

… That’s the opinion of Simon Wren-Lewis, writer of the Mainly Macro blog.

It’s his response to the oft-asserted claim that Labour crashed the economy; he can’t deny it altogether because Labour’s failure to regulate the banks does make it partly true, in his eyes (we’ll skate over the fact that the banks had a certain responsibility in that area themselves. Now we know they’ll never behave responsibly it makes the future a little easier to navigate – or at least, it should).

Professor Wren-Lewis writes: “That is I guess why Ed Miliband seemed to respond to this accusation by saying something like: “yes we did get financial regulation wrong, but …”. That may be an honest reply, but it is not very effective, because many will read it as admitting Labour caused the recession.

“A better reply would be: “Everyone knows that the recession was caused by the global financial crisis and insufficient regulation, but the recession would have been worse if the Conservatives had been in power.”

“As Mervyn King says, “the real problem was a shared intellectual view right across the entire political spectrum and shared across the financial markets that things were going pretty well”, a view which he of course shared.

“I think the claim that the recession would have been worse if the Conservatives had been in government can be justified on two grounds. First, the Conservatives did accuse Labour of too much financial regulation, not too little. Second, they were against Labour’s fiscal stimulus in 2009.”

Why is it important that Labour combat this charge effectively? “When it comes to a contest of macroeconomic competence between the last Labour government and the current coalition, Labour wins hands down.”

The reason? “The coalition made such a bad mistake with austerity… Losing the equivalent of at least £4,000 per household is a big deal.

“Even if we were prepared to forgive this as a genuine mistake, to plan to make exactly the same mistake again either suggests a complete inability to learn, complete incompetence, or a duplicitous pursuit of ideology over social welfare.”

Read the full article on Mainly Macro. It is plainly written and even shows how you can measure up the Coalition’s performance against Labour’s for yourself.

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