Playing the eurozone blame game shows the extent of Osborne's failure

The longer the coalition remains in denial, the longer it will take for Britain to recover from its economic depression.

One of the first lessons a new government learns is how to blame their predecessors. Labour spent years blaming the ills of the country on "18 years of Conservative misrule". Two years after taking office the coalition has not missed a trick in turning the blame game into an art form. The promised deep public spending cuts were all Gordon Brown's fault and lower than expected economic growth was blamed on everything from the weather to the Royal Wedding.

The current chief culprit for the coalition's failings is the eurozone. I'm sure I'm not the only one who felt a distinct feeling of déja vu when the government responded to this week's dreadful Q2 figures by blaming the euro.

Of course, given that the eurozone is our main trading partner its problems, to put it mildly, do not help British exports. More than two years into the crisis it is still unclear whether Europe's leaders have the political will and nous to break the link between heavily indebted banks and sovereigns and restore calm to the markets.

But the reality is that even while the eurozone faces an existential crisis, with a handful of its 17 countries needing emergency support because they can't access the bond market, Britain is still faring worse. A chart by ABD Investment shows that, since the financial crisis began at the end of 2007, Britain has been comfortably outperformed by the US, Japan, Germany and France.

This year Britain's output is estimated to be 93.5 compared to the baseline figure of 100 in 2008. To put this in context, Germany is one of the few countries where output has now overtaken pre-crisis levels at 104.2 compared to a eurozone average at 97.5. The Spanish economy, which is serious danger of needing a €300 billion bail-out as it struggles to cope with crippling borrowing rates of over 7 per cent and scarily high unemployment, is only fractionally lower than Britain's at 91.9, with Italy at 90.9. France, which lost its triple-A credit rating at the start of the year, is at 97.7.

After three quarters in a row reporting a decline in output, the bald truth is that economic output is now lower than it was when the Coalition took office. There can certainly be little doubt that were Britain a member of the eurozone, we would have needed a massive bail-out, possibly larger than Spain, Greece, Ireland, Portugal and Cyprus put together. Our triple-A credit rating would have gone months ago, perhaps even last year.

By any yardstick, George Osborne and Danny Alexander have failed on an impressive scale and should be waiting for their P45s.

But, whisper it, Britain should actually be profiting from the eurozone crisis. As investors in the European bond market panic, sending borrowing rates sky-high for Spain, Italy and others, the UK is one of the main beneficiaries from the flight of capital. Despite the weaknesses in the British economy, like the US, traders are so desperate to buy our bonds that they will pay for the privilege. Earlier this week interest rates on 10 year gilts fell to 1.4 per cent, well below the 2.4 per cent inflation level, and fully 6 per cent lower than Spain. It is frightening to imagine the extra debt we would have had without the eurozone crisis.

The Coalition should be using the massive advantage of such historically low borrowing costs to fund targeted stimulus measures. The best place to start would be to bring forward badly needed public infrastructure projects. The National Infrastructure plan states that Britain needs to invest £400 billion in infrastructure between now and 2020 if we are to remain competitive, and there is no better time to start. While penal borrowing costs, particularly for the southern Mediterranean nations, are effectively forcing eurozone countries to drastically scale back public spending, Britain is in an almost unique position to launch a series of supply-side measures to boost demand and generate growth.

At some point, people will tire of the coalition's protestations that the double dip recession is all the fault of Gordon Brown and those incompetent foreigners in the eurozone. Labour, too, have to be honest enough to admit that Britain's comatose economy is of our own making and, regardless of what does or doesn't happen in the eurozone, requires resolution at home.

The longer Cameron and Osborne et al remain in denial, absolving themselves of responsibility while persisting with the idea that Britain can operate like a north European version of the Cayman Islands, the longer it will take for Britain to recover from its economic depression. The stark reality is that even with a solid Olympics-driven bump, 2012 will be a year of recession. Of more concern to ministers is that barring a heroic recovery over the next three years, the Tories and Lib Dems will go to the country on the basis of economic output that is comfortably lower than it was in 2007. Barring an implosion by the Labour Party, that would probably cost them their jobs.

 

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"We repealed, then forgot": the long shadow of Section 28 homophobia

Why are deeply conservative views about the "promotion" of homosexuality still being reiterated to Scottish school pupils? 

Grim stories of LGBTI children being bullied in school are all too common. But one which emerged over the weekend garnered particular attention - because of the echoes of the infamous Section 28, nearly two decades after it was scrapped.

A 16-year-old pupil of a West Lothian school, who does not wish to be named, told Pink News that staff asked him to remove his small rainbow pride badge because, though they had "no problem" with his sexuality, it was not appropriate to "promote it" in school. It's a blast from the past - the rules against "promoting" homosexuality were repealed in 2000 in Scotland, but the long legacy of Section 28 seems hard to shake off. 

The local authority responsible said in a statement that non-school related badges are not permitted on uniforms, and says it is "committed to equal rights for LGBT people". 

The small badge depicted a rainbow-striped heart, which the pupil said he had brought back from the Edinburgh Pride march the previous weekend. He reportedly "no longer feels comfortable going to school", and said homophobia from staff members felt "much more scar[y] than when I encountered the same from other pupils". 

At a time when four Scottish party leaders are gay, and the new Westminster parliament included a record number of LGBTQ MPs, the political world is making progress in promoting equality. But education, it seems, has not kept up. According to research from LGBT rights campaigners Stonewall, 40 per cent of LGBT pupils across the UK reported being taught nothing about LGBT issues at school. Among trans students, 44 per cent said school staff didn’t know what "trans" even means.

The need for teacher training and curriculum reform is at the top of campaigners' agendas. "We're disappointed but not surprised by this example," says Jordan Daly, the co-founder of Time for Inclusive Education [TIE]. His grassroots campaign focuses on making politicians and wider society aware of the reality LGBTI school students in Scotland face. "We're in schools on a monthly basis, so we know this is by no means an isolated incident." 

Studies have repeatedly shown a startling level of self-harm and mental illness reported by LGBTI school students. Trans students are particularly at risk. In 2015, Daly and colleagues began a tour of schools. Shocking stories included one in which a teacher singled out a trans pupils for ridicule in front of the class. More commonly, though, staff told them the same story: we just don't know what we're allowed to say about gay relationships. 

This is the point, according to Daly - retraining, or rather the lack of it. For some of those teachers trained during the 1980s and 1990s, when Section 28 prevented local authorities from "promoting homosexuality", confusion still reigns about what they can and cannot teach - or even mention in front of their pupils. 

The infamous clause was specific in its homophobia: the "acceptability of homosexuality as a pretended family relationship" could not be mentioned in schools. But it's been 17 years since the clause was repealed in Scotland - indeed, it was one of the very first acts of the new Scottish Parliament (the rest of the UK followed suit three years later). Why are we still hearing this archaic language? 

"We repealed, we clapped and cheered, and then we just forgot," Daly says. After the bitter campaign in Scotland, in which an alliance of churches led by millionaire businessman Brian Souter poured money into "Keeping the Clause", the government was pleased with its victory, which seemed to establish Holyrood as a progressive political space early on in the life of the parliament. But without updating the curriculum or retraining teaching staff, Daly argues, it left a "massive vacuum" of uncertainty. 

The Stonewall research suggests a similar confusion is likely across the UK. Daly doesn't believe the situation in Scotland is notably worse than in England, and disputes the oft-cited allegation that the issue is somehow worse in Scotland's denominational schools. Homophobia may be "wrapped up in the language of religious belief" in certain schools, he says, but it's "just as much of a problem elsewhere. The TIE campaign doesn't have different strategies for different schools." 

After initial disappointments - their thousands-strong petition to change the curriculum was thrown out by parliament in 2016 - the campaign has won the support of leaders such as Nicola Sturgeon and Kezia Dugdale, and recently, the backing of a majority of MSPs. The Scottish government has set up a working group, and promised a national strategy. 

But for Daly, who himself struggled at a young age with his sexuality and society's failure to accept it, the matter remains an urgent one.  At just 21, he can reel off countless painful stories of young LGBTI students - some of which end in tragedy. One of the saddest elements of the story from St Kentigern's is that the pupil claimed his school was the safest place he had to express his identity, because he was not out at home. Perhaps for a gay pupil in ten years time, that will be a guarantee. 

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