Thursday 8 February 2007

'The Strongest economy in our country's history' says Tony Blair

OK, so Prime Minister's Questions is not renowned worldwide for the trading of a factually correct information, but this outburst by Blair, in support of Brown, is beyond belief.

Before examining further, it did get worse;

"This chancellor has produced the strongest economy, the lowest interest rates, the lowest unemployment, the highest employment, in our country's history," said Mr Blair.

This requires some understanding of the terms, as well as what has been ignored, to understand the depth of the rubbish being spouted here. It is the equivalent to seeing entire air-fleets of pigs flying in V formation over London.

So from the beginning; the strongest economy. Since 1997, average UK growth has been 2.6%. This is in line with the long-term trend started after the Thatcher economic revolution in 1983. However, at the end of 2005/6 general government debt was £529.1 billion, equivalent to 42.1 per cent of GDP (here). So alot of this growth has been funded by government debt. This is before we add PFI projects into the mix; this would change skew the numbers even further (see Wat Tyler)

Of course we will always have a historically, by numbers, 'the strong economy.' This is due to inflation. But say in 1850, the UK have 50% share of global GDP, today we have 5%. IS our economy the strongest it has ever been?

"The lowest interest rates" well last month the bank of England raised rates to 5.25% and they are heading upwards. So this statement must be a non-sequitor. A few years ago we did briefly have low interest rates and low inflation - but this has all changed radically with both heading upwards quickly now. Real Inflation RPIX is at at least 4.4% currently.

"the lowest unemployment" - so is this true in that unemployment peaked in 1993 at 3 million and has declined ever since. However this effect has bottomed out in the last 2 years and unemployment is now creeping up again. The other part Mr Blair ignores is that those on benefits, including sickness benefits, has shot up. This skews the unemployment figures and shows how much is now hidden.

"the highest employment" - again similar to above, with a growing economy and growing population it would be difficult to see how you could have anything other than this term. he is in effect congratulating Mr. Brown for not overseeing a huge recession. Also of course the 500,000 immigrants who have found jobs in the UK since 2001 help this figure; but what other effects do they have on our society?

No wonder people don't take Blair seriously, as can be seen he just misquotes and fibs openly in Parliament. Time to go with Broon to follow swiftly after. Sadly, I think I may be referring to this post in a year or so's time as the recession sets in....


Anonymous said...

The problem is Tony Blair can sound convincing, but there can't be one person whose life has not been adversely affected over the last 10 years.

Stan Bull said...

Exactly, ellee. That is what my old mum always says. According to a study by the Centre for Policy Studies, Britains's poorest are paying a higher share of the total tax burden but getting a lower proportion of government benefits than when Labour came to power. Yet many still vote for this party of liars come rain or shine!
Whilst of course the 'richest decile' have increased their 'Buying Power' exponentially in the same period.

Newmania said...

Without having a detailed grasp of it CU my sense is that unemployment is highly shifting phenomenon and that pressures that would once have lead to it are now becoming expressed in other ways. It was only in the 70s that people were still wondering if 3,000,000 unemployed would precipitate a political apocalypse but now “employment “is so much more various and of a quite different nature, the “working population“ is of an different kind . I find it hard to there are entire areas of the country where almost no-one is working and further area where no-one is working in an economically productive way.
Similarly with the old BOP offse with demand is increased and supply is failing. With capital and production so fluid around the world much I begin to feel that economists may be fighting the previous battle and the outcomes are uncertain.
Overall a great opportunity has been missed and the hard edge seem ( to me) to be housing but all I meant to add was a distrust of the received parameters as they were taught to me at least a wee while ago now.

You mention PFI debt and this appeared in the DT today . I am somewhat fascinated by “off balance sheet “ borrowing . I can think of one instance of it at least, Lloyds membership security ,..disastrous and a myth as was eventually discovered .

Gklad to see this from you CU its useful for me

PS rest assured I will be doing far less blogging v soon.

CityUnslicker said...

Ellee - Quite

IT - This nails it too, everyone is poorer now than they need to be. There is no excuse for this for either Blair or Brown.

N - Hope your not planning anything too radical N. I would miss your comments. I think you raise a good point. Whole areas of the country where few are employed. The majority of people in Scotland and the Northeast working for the State. All this in a time of relative economic plenty!

Newmania said...

The problem is Tony Blair can sound convincing

he convinced me in my shame . Shows how far to the right I have migrated ovewr the years but even now I don`t know what else there was to do

James Higham said...

This post should be on the MSM - it is a strong argument against Blair continuing one more day.

Stan Bull said...

N, I have to confess....that in '97 I deliberately didn't cast a vote. My first and probably last abstention.

CityUnslicker said...

I was in the US in 97' so was unable to vote. Growing up in the safest Tory seat in the country has meant my vote has never meant much. All change next time.

JH- High praise. I have been thinking about this blogging malarky recently. I really don't want to be a journalist and will be dismayed if I ever get quoted. Luckily this highly unlikely anyway.

Anonymous said...

£529 billion? For 40,000,000 taxpayers thats over £13k a piece!


Shades said...

Good post.