Whether or not you include oil, Osborne's economic record is atrocious

Double-dip or not, stagnation is here for sure.

Earlier this week I wrote that overly focusing on the prospect of a "triple dip" recession was blinding too many to the equally damaging prospect of continued stagnation. Maybe I was too specific; it seems that some are still focusing on the last recession (the one we now call the double-dip).

The Telegraph quotes the chief economist of Henderson Global Investors, Simon Ward, who argues that "Britain never had a double dip recession". Building on the recent upward revisions to the ONS' estimates of growth in 2012, Ward says that:

The “phantom” recessions reflected continuing weak North Sea oil and gas extraction and when that was stripped out, it revealed that there had never been a ‘double-dip’ in the UK onshore economy.

Mr Ward said North Sea oil production is supply-driven, and while it has been weak because of reserves depletion and unusual maintenance shutdowns, "these are of no relevance to the wider economy so it is reasonable to strip out the North Sea when assessing underlying trends".

Of course, if it's necessary to retrospectively strip out resource extraction from estimates of the economy, it's necessary to strip it out entirely. That would present a rather different view of, for instance, the economic competency of Margaret Thatcher, presiding over the original North Sea oil boom. It would also be a blow for advocates of fracking, as their desired resource boom would be excluded from the metrics.

As it is, the ONS already produces a metric for GDP growth excluding oil and gas (it's series KLH8, if you want to check it out). It only goes back to 1997, so we can't test the Thatcher proposition, but it's pretty clear that our oil and gas industries have been declining for quite some time. Every time they've had an effect since 2003, it's been negative, and even before then, it was rarely hugely positive. It's fair to say that, if ignoring resource extraction makes Osborne look economically competent, it makes Gordon Brown look like a genius chancellor, consistently achieving even more growth than he is already given credit for.

As it is, we don't strip out those industries unless we're making a very specific point, because they are part of the economy, and GDP is supposed to be a measure of the whole economy, not just the parts which are reflective of "underlying trends".

But again, this is all arguing a moot point. Even if we did strip out the effects of oil and gas extraction from the first quarter of 2012 only, thus ensuring that George Osborne avoided a technical recession by the narrowest margin possible, he would still have a terrible record on growth. The real world growth figures for our double dip were contractions of 0.3, 0.1 and 0.3 per cent respectively for Q4 2011 and Q1+2 2012. The figures Ward wants to use instead show a contraction of 0.2 per cent, then perfect stagnation, and then a contraction of 0.3 per cent.

In no world is 0 per cent growth (and, as I've said before, contraction in per capita GDP) between two quarters of contraction acceptable. Yet by focusing so heavily on the difference between -0.1 per cent and 0 per cent, Osborne and his defenders are able to claim that it's just a statistical quirk that gives him his bad reputation, rather than something far more intrinsic.

Double dip… a bactrian camel with its newborn calf in Budapest, Hungary. Photograph: Getty Images

Alex Hern is a technology reporter for the Guardian. He was formerly staff writer at the New Statesman. You should follow Alex on Twitter.

Photo: Getty Images
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The Fire Brigades Union reaffiliates to Labour - what does it mean?

Any union rejoining Labour will be welcomed by most in the party - but the impact on the party's internal politics will be smaller than you think.

The Fire Brigades Union (FBU) has voted to reaffiliate to the Labour party, in what is seen as a boost to Jeremy Corbyn. What does it mean for Labour’s internal politics?

Firstly, technically, the FBU has never affliated before as they are notionally part of the civil service - however, following the firefighters' strike in 2004, they decisively broke with Labour.

The main impact will be felt on the floor of Labour party conference. Although the FBU’s membership – at around 38,000 – is too small to have a material effect on the outcome of votes themselves, it will change the tenor of the motions put before party conference.

The FBU’s leadership is not only to the left of most unions in the Trades Union Congress (TUC), it is more inclined to bring motions relating to foreign affairs than other unions with similar politics (it is more internationalist in focus than, say, the PCS, another union that may affiliate due to Corbyn’s leadership). Motions on Israel/Palestine, the nuclear deterrent, and other issues, will find more support from FBU delegates than it has from other affiliated trade unions.

In terms of the balance of power between the affiliated unions themselves, the FBU’s re-entry into Labour politics is unlikely to be much of a gamechanger. Trade union positions, elected by trade union delegates at conference, are unlikely to be moved leftwards by the reaffiliation of the FBU. Unite, the GMB, Unison and Usdaw are all large enough to all-but-guarantee themselves a seat around the NEC. Community, a small centrist union, has already lost its place on the NEC in favour of the bakers’ union, which is more aligned to Tom Watson than Jeremy Corbyn.

Matt Wrack, the FBU’s General Secretary, will be a genuine ally to Corbyn and John McDonnell. Len McCluskey and Dave Prentis were both bounced into endorsing Corbyn by their executives and did so less than wholeheartedly. Tim Roache, the newly-elected General Secretary of the GMB, has publicly supported Corbyn but is seen as a more moderate voice at the TUC. Only Dave Ward of the Communication Workers’ Union, who lent staff and resources to both Corbyn’s campaign team and to the parliamentary staff of Corbyn and McDonnell, is truly on side.

The impact of reaffiliation may be felt more keenly in local parties. The FBU’s membership looks small in real terms compared Unite and Unison have memberships of over a million, while the GMB and Usdaw are around the half-a-million mark, but is much more impressive when you consider that there are just 48,000 firefighters in Britain. This may make them more likely to participate in internal elections than other affiliated trade unionists, just 60,000 of whom voted in the Labour leadership election in 2015. However, it is worth noting that it is statistically unlikely most firefighters are Corbynites - those that are will mostly have already joined themselves. The affiliation, while a morale boost for many in the Labour party, is unlikely to prove as significant to the direction of the party as the outcome of Unison’s general secretary election or the struggle for power at the top of Unite in 2018. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.