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
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Unite stewards urge members to back Owen Smith

In a letter to Unite members, the officials have called for a vote for the longshot candidate.

29 Unite officials have broken ranks and thrown their weight behind Owen Smith’s longshot bid for the Labour leadership in an open letter to their members.

The officials serve as stewards, conveners and negotiators in Britain’s aerospace and shipbuilding industries, and are believed in part to be driven by Jeremy Corbyn’s longstanding opposition to the nuclear deterrent and defence spending more generally.

In the letter to Unite members, who are believed to have been signed up in large numbers to vote in the Labour leadership race, the stewards highlight Smith’s support for extra funding in the NHS and his vision for an industrial strategy.

Corbyn was endorsed by Unite, Labour's largest affliated union and the largest trades union in the country, following votes by Unite's ruling executive committee and policy conference. 

Although few expect the intervention to have a decisive role in the Labour leadership, regarded as a formality for Corbyn, the opposition of Unite workers in these industries may prove significant in Len McCluskey’s bid to be re-elected as general secretary of Unite.

 

The full letter is below:

Britain needs a Labour Government to defend jobs, industry and skills and to promote strong trade unions. As convenors and shop stewards in the manufacturing, defence, aerospace and energy sectors we believe that Owen Smith is the best candidate to lead the Labour Party in opposition and in government.

Owen has made clear his support for the industries we work in. He has spelt out his vision for an industrial strategy which supports great British businesses: investing in infrastructure, research and development, skills and training. He has set out ways to back British industry with new procurement rules to protect jobs and contracts from being outsourced to the lowest bidder. He has demanded a seat at the table during the Brexit negotiations to defend trade union and workers’ rights. Defending manufacturing jobs threatened by Brexit must be at the forefront of the negotiations. He has called for the final deal to be put to the British people via a second referendum or at a general election.

But Owen has also talked about the issues which affect our families and our communities. Investing £60 billion extra over 5 years in the NHS funded through new taxes on the wealthiest. Building 300,000 new homes a year over 5 years, half of which should be social housing. Investing in Sure Start schemes by scrapping the charitable status of private schools. That’s why we are backing Owen.

The Labour Party is at a crossroads. We cannot ignore reality – we need to be radical but we also need to be credible – capable of winning the support of the British people. We need an effective Opposition and we need a Labour Government to put policies into practice that will defend our members’ and their families’ interests. That’s why we are backing Owen.

Steve Hibbert, Convenor Rolls Royce, Derby
Howard Turner, Senior Steward, Walter Frank & Sons Limited
Danny Coleman, Branch Secretary, GE Aviation, Wales
Karl Daly, Deputy Convenor, Rolls Royce, Derby
Nigel Stott, Convenor, BASSA, British Airways
John Brough, Works Convenor, Rolls Royce, Barnoldswick
John Bennett, Site Convenor, Babcock Marine, Devonport, Plymouth
Kevin Langford, Mechanical Convenor, Babcock, Devonport, Plymouth
John McAllister, Convenor, Vector Aerospace Helicopter Services
Garry Andrews, Works Convenor, Rolls Royce, Sunderland
Steve Froggatt, Deputy Convenor, Rolls Royce, Derby
Jim McGivern, Convenor, Rolls Royce, Derby
Alan Bird, Chairman & Senior Rep, Rolls Royce, Derby
Raymond Duguid, Convenor, Babcock, Rosyth
Steve Duke, Senior Staff Rep, Rolls Royce, Barnoldswick
Paul Welsh, Works Convenor, Brush Electrical Machines, Loughborough
Bob Holmes, Manual Convenor, BAE Systems, Warton, Lancs
Simon Hemmings, Staff Convenor, Rolls Royce, Derby
Mick Forbes, Works Convenor, GKN, Birmingham
Ian Bestwick, Chief Negotiator, Rolls Royce Submarines, Derby
Mark Barron, Senior Staff Rep, Pallion, Sunderland
Ian Hodgkison, Chief Negotiator, PCO, Rolls Royce
Joe O’Gorman, Convenor, BAE Systems, Maritime Services, Portsmouth
Azza Samms, Manual Workers Convenor, BAE Systems Submarines, Barrow
Dave Thompson, Staff Convenor, BAE Systems Submarines, Barrow
Tim Griffiths, Convenor, BAE Systems Submarines, Barrow
Paul Blake, Convenor, Princess Yachts, Plymouth
Steve Jones, Convenor, Rolls Royce, Bristol
Colin Gosling, Senior Rep, Siemens Traffic Solutions, Poole

Stephen Bush is special correspondent at the New Statesman. He usually writes about politics.