The latest inflation figures are shocking. The Consumer Price Index rose 0.7 per cent last month to 5.2 per cent (the target rate, of course, is 2 per cent), the highest level since September 2008, while the Retail Price Index, the traditional measure of inflation, rose to 5.6 per cent, up from 5.2 per cent in August and the highest figure since June 1991. The UK now has the highest inflation of any EU country except Estonia. And all this before the Bank of England has injected £75bn worth of quantitative easing (QE), with inevitably inflationary consequences. It's nothing compared to the 1970s - when inflation rose above 25 per cent - but it explains why almost everyone is feeling the pinch.
The causes are wearily familiar: the depreciation of sterling, the VAT rise and rising energy prices (voters' number one concern, according to opinion polls). Average gas and electricity bills rose 7.5 per cent between August and September. But over the last year, excluding bonus payments, wages have risen by just 1.8 per cent, meaning millions are suffering an effective pay cut.
So, to quote Lenin, what is to be done? There is a (correct) bipartisan consensus that lack of growth, not inflation, is Britain's biggest problem. Hence George Osborne's support for a second round of QE (described by him in 2009 as "the last resort of desperate governments") and the government's tacit agreement with the Bank of England that interest rates will remain at record lows. A premature rise in the base rate (currently 0.5 per cent) would strangle growth. Similarly, Ed Balls and Ed Miliband continue to believe that sustained monetary stimulus is essential for the health of the economy.
In addition, all sides both hope and expect that inflation will come down next year as temporary factors such as the VAT rise and the surge in oil prices are discounted. Indeed, the Monetary Policy Committee's biggest fear is not inflation but deflation.
But none of this will prevent Labour delivering some potent attack lines. Here's Rachel Reeves, the party's new shadow chief secretary to the Treasury and a former Bank of England economist:
It's now clear we have the worst of all worlds - high inflation, rising unemployment and a stagnant economy since last autumn. When Britain now has the highest inflation of any EU country except Estonia, families and pensioners feeling the squeeze want out of touch Ministers to take some responsibility and take action now ... The Bank of England has been put in an impossible position by George Osborne. It has been left to do all the work to support the economy, while spending cuts and tax rises that go too far and too fast have crushed growth and the VAT rise has fuelled inflation too.
The stark reality for Osborne is that, under his stewardship, the UK now has one of the highest rates of inflation in the EU and one of the lowest rates of growth. As low and middle earners (11 million of whom have seen no rise in their real incomes since 2003) are squeezed by rising prices, falling wages, higher taxes and lower benefits, the pressure will intensify on the Chancellor to offer some relief.