Two polls today show that the public is increasingly pessimistic about the economy. A Guardian/ICM poll found economic confidence at its lowest level since just before the financial crash in 2008. Fifty-seven per cent of respondents said they were not confident about the state of the economy, while 42 per cent did, giving a net confidence index of -15 points. Since ICM began measuring financial confidence in 2001, it has only been lower once (July 2008).
A Times/Populus poll (£) has similarly poor results, with 79 per cent of voters saying they believe the country will fare "badly" over the next year, versus only 18 per cent who think it will do "well". This gives a net optimism score of -61, a 21 point drop since September. While the questions and indexes are slightly different in each poll, this too is the lowest score Populus has found since the time of the banking crisis, in January 2009.
There are clear reasons for this: unemployment is steadily increasing, growth predictions are constantly lowered, and the eurozone crisis is unsettling markets. All of this would appear to be bad news for the government and its austerity package, and a blessing for Labour.
However, this is not the case. The ICM poll found that 30 per cent still blame the slowdown on debts accrued by Labour, with only 24 per cent blaming the coalition's spending cuts. Meanwhile, the Populus survey found that 40 per cent of people trusted David Cameron and George Osborne to run the economy, while just 26 per cent said they had more faith in Ed Miliband and Ed Balls.
While both polls saw Labour keep its narrow lead (two points ahead with ICM and eight with Populus), these results on the economy show the extent to which the party is missing an open goal. Yesterday, Cameron admitted that the government may not reach its deficit reduction targets, telling the CBI conference that "getting debt under control is proving harder than anyone envisaged", partly because of sluggish growth. The Office for Budget Responsibility is expected to downgrade its forecast -- again -- next week, when Osborne makes his Autumn Statement.
The coalition's narrative that Labour's profligacy is entirely to blame for this crisis should not hold for much longer: their policies are doing little to help the recovery; indeed, are compounding the problem. As Nobel Laureate Paul Krugman put it: "Austerity in Britain is going really, really badly." Labour must step up its visibility and present a clear, thought out alternative strategy if it wants to seize the opportunity of growing public discomfort with the way the economy is headed.