Could interest rates go even lower?

A reduction in the base rate from 0.5 per cent to 0.25 per cent is no longer unthinkable.

With just a month to go until his autumn statement, the latest set of growth forecasts make grim reading for George Osborne. Ernst and Young's Item club predicts that the economy will grow by just 0.9 per cent this year, well below the 1.4 per cent it predicted three months ago. It has also downgraded its 2012 growth forecast from 2.2 per cent to 1.5 per cent.

Peter Spencer, the body's chief economic adviser explains:

It's worse than we thought. The bright spots in our forecast three months ago - business investment and exports - have dimmed to a flicker as uncertainty around Greece and the stability of the eurozone increases.

Significantly, the club uses the same forecasting methods as the Office for Budget Responsibility (OBR), offering us a preview of the downward revisions the OBR will have to make when it publishes its new estimates on 29 November, the day of Osborne's statement. Lower growth, of course, means higher borrowing, so the OBR is also likely to revise its deficit forecasts upwards. The club predicts that unemployment will rise from 2.57m to 2.7m over the next 18 months, resulting in lower tax revenues and higher welfare payments.

In response, it calls for a cut in stamp duty for first-time buyers and a reduction in interest rates from their current record low of 0.5 per cent to 0.25 per cent. The Monetary Policy Committee (MPC) has held the base rate at 0.5 per cent since March 2009 but it's worth noting that the possibility of reducing it even further was discussed at the last Bank of England meeting. The most recent BoE minutes (from 7-8 September) noted that the MPC "revisited the earlier decision not to lower Bank Rate below 0.5 per cent".

A reduction to 0.25 per cent still seems unlikely but, given the parlous state of the British economy, I'd expect that the MPC is ruling nothing out. As Mervyn King said when he announced another round of quantitative easing, "When the world changes, we change our policy response".

George Eaton is political editor of the New Statesman.

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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.”

...is, 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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