Getting from economic bingo to a growth plan

The sheer volume of economic statistics released last week highlights the challenge facing all three

The last week has produced a bumper crop of economic reports and statistics - resulting in a form of daily economic bingo - which will define the political and economic debate for the rest of the autumn and set the scene for the run into 2012. It's a week that has sharpened the economic and political challenge on growth - not just for the Coalition, but for Labour too.

It kicked off with Incomes Data Services grabbing the headlines with their finding that this year there has been a near 50 per cent increase in total remuneration for FTSE 100 directors - a hike that dwarfs the 2.3 per cent increase in average earnings, or the 4.5 per cent annual rise in the FTSE 100. It provided extra piquancy to the rapidly unfolding events at St Pauls, as well as to our new poll showing that only one in three workers feel secure in their jobs (one in four part-time workers), a finding that helps explain the ongoing weakness of consumer spending as well as the upward tick in savings.

Hot on the heels of this the OECD slashed growth figures for the eurozone to just 0.3 per cent in 2012 and to 1.8 per cent for the US. It decided to avoid producing specific forecasts for UK (and other individual European countries), as it persisted with its own brand of economic diplomacy by serving up just enough quotes for either side of the political argument to claim at least some vindication. Less diplomatic was the International Labour Organisation (ILO) - who clearly didn't receive David Cameron's new memo calling for an end to economic pessimism - with its bleak headline that it will take at least five years for employment to return to pre-crisis levels in advanced economies, making widespread social unrest far more likely.

Next up was the ONS telling us that the UK economy grew by 0.5 per cent in the third quarter of the year, above the expected 0.3 per figure, yet a long way below what is required to meet the OBR's 1.7 per cent growth forecast for 2011. It means the economy has grown just 0.6 over the last 6 months, or a paltry 0.5 over the last 12 months. Leading City commentators immediately predicted next quarter's figures could well be worse, in part because the latest purchasing managers' index (PMI) is going backwards -- suggesting the manufacturing sector is contracting for the first time since mid-2009. The gloom was only reinforced by further turmoil in Greece - with NIESR predicting a 70 per cent chance of recession in the UK next year without a resolution of the euro crisis, and a staggering 50 per cent chance even if one is found. Continued sluggish growth also shines the spotlight on the OBR who will soon need to downgrade their growth forecasts - presumably this time to a level which leaves them confident they won't have to do this once more next spring.

All of this economic news raises the stakes for both sides at Westminster. For the Coalition the clock is ticking with little more than three weeks until the Chancellor's autumn statement and the long awaited, and much vaunted, growth strategy.

The smoke signals are not encouraging. Repeated briefings are stoking contradictory expectations, risking disappointment on all sides. On the Tory right there are high hopes that the forthcoming Beecroft report will serve up some real red meat on deregulation (eg reigning in maternity rights, and ending unfair dismissal). Few of these ideas may survive Cabinet discussion, and if they do they are likely to do little to boost overall employment levels, yet could still destabilise Coalition relations. Meanwhile, those closer to the centre ground are pinning their hopes on talk of a new stream of capital projects as evidence that a meaningful 'plan A+' may emerge, involving significant new infrastructure investment (even if it falls short of a 'plan B' which slows the pace of cuts to current spending). These hopes may well also be dashed if what materialises is simply a list of modest announcements broadly in line with existing planned (cuts) to capital spending.

For their part Labour strategists are pleased that 'growth' rather than 'the deficit' has become the dominant economic and political frame in Westminster. This is perhaps the first time (other than the momentary News International meltdown) that the issue the Labour leadership wants to talk about overlaps so directly with what the media wants to write about - which provides a real opportunity.

Despite this Labour has yet to flesh out its own growth strategy - an omission that is likely to become more glaring over the next few weeks. Labour has, of course, put forward some specific growth measures. And it has made some important big picture economic arguments - most noticeably Ed Miliband's conference speech, and Ed Balls' 2010 Bloomberg lecture. Even foes of the leadership now concede that both of these were significant moments, that have aged well, and to some degree changed the political weather. Yet supporters would have to admit that neither intervention really sought to clarify the nature of the growth problem the UK is likely to face in 2012-2015 (and beyond), never mind Labour's distinctive post-crisis approach to industrial, infrastructure and innovation policy. Neither Ed Miliband's call for a new ethic of responsibility in our system of capitalism, nor Ed Balls' critique of austerity economics answers this. Thinking on longer-term growth remains a work in progress.

In the interim the risk for Labour - on growth as on other issues - is that it repeats the pattern of getting ahead on an issue by correctly identifying and naming it (think "squeezed middle" or "the promise of Britain") only to struggle to convert this into real momentum with a distinctive policy direction. It quickly needs to learn how to make its prescience pay a political dividend.

Gavin Kelly is a former adviser to Downing Street and the Treasury. He tweets @GavinJKelly1.

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No, Jeremy Corbyn did not refuse to condemn the IRA. Please stop saying he did

Guys, seriously.

Okay, I’ll bite. Someone’s gotta say it, so really might as well be me:

No, Jeremy Corbyn did not, this weekend, refuse to condemn the IRA. And no, his choice of words was not just “and all other forms of racism” all over again.

Can’t wait to read my mentions after this one.

Let’s take the two contentions there in order. The claim that Corbyn refused to condem the IRA relates to his appearance on Sky’s Sophy Ridge on Sunday programme yesterday. (For those who haven’t had the pleasure, it’s a weekly political programme, hosted by Sophy Ridge and broadcast on a Sunday. Don’t say I never teach you anything.)

Here’s how Sky’s website reported that interview:


The first paragraph of that story reads:

Labour leader Jeremy Corbyn has been criticised after he refused five times to directly condemn the IRA in an interview with Sky News.

The funny thing is, though, that the third paragraph of that story is this:

He said: “I condemn all the bombing by both the loyalists and the IRA.”

Apparently Jeremy Corbyn has been so widely criticised for refusing to condemn the IRA that people didn’t notice the bit where he specifically said that he condemned the IRA.

Hasn’t he done this before, though? Corbyn’s inability to say he that opposed anti-semitism without appending “and all other forms of racism” was widely – and, to my mind, rightly – criticised. These were weasel words, people argued: an attempt to deflect from a narrow subject where the hard left has often been in the wrong, to a broader one where it wasn’t.

Well, that pissed me off too: an inability to say simply “I oppose anti-semitism” made it look like he did not really think anti-semitism was that big a problem, an impression not relieved by, well, take your pick.

But no, to my mind, this....

“I condemn all the bombing by both the loyalists and the IRA.”, despite its obvious structural similarities, not the same thing.

That’s because the “all other forms of racism thing” is an attempt to distract by bringing in something un-related. It implies that you can’t possibly be soft on anti-semitism if you were tough on Islamophobia or apartheid, and experience shows that simply isn’t true.

But loyalist bombing were not unrelated to IRA ones: they’re very related indeed. There really were atrocities committed on both sides of the Troubles, and while the fatalities were not numerically balanced, neither were they orders of magnitude apart.

As a result, specifically condemning both sides as Corbyn did seems like an entirely reasonable position to take. Far creepier, indeed, is to minimise one set of atrocities to score political points about something else entirely.

The point I’m making here isn’t really about Corbyn at all. Historically, his position on Northern Ireland has been pro-Republican, rather than pro-peace, and I’d be lying if I said I was entirely comfortable with that.

No, the point I’m making is about the media, and its bias against Labour. Whatever he may have said in the past, whatever may be written on his heart, yesterday morning Jeremy Corbyn condemned IRA bombings. This was the correct thing to do. His words were nonetheless reported as “Jeremy Corbyn refuses to condemn IRA”.

I mean, I don’t generally hold with blaming the mainstream media for politicians’ failures, but it’s a bit rum isn’t it?

Jonn Elledge edits the New Statesman's sister site CityMetric, and writes for the NS about subjects including politics, history and Daniel Hannan. You can find him on Twitter or Facebook.

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