Thursday, 10 September 2015

The first phase of the economic recovery is over but we must still hold our nerve and balance the books

Interesting article this week from one of the top journals - see below - on economic prospects as the markets experienced an August wobble. The doomsayers between 2010-2015 definitely got it wrong. I have listened to some in the house of commons argue that trying to live within your means, create jobs, support small businesses and tackle our debts and overspending is the wrong thing to do [what others have called austerity]. Do you Remember my late parliamentary opponent Ed Balls arguing it was all "too far too fast"? Well my nemesis got it spectacularly wrong, and then lost his job. I remain convinced that the slow but steady path to balancing the books and ensuring that we do not spend what we do not have is the right path. There will be further reductions in public spending to come and I want my generation to deal with these problems, not pass them on to our children.

Growth has been strong, and far more jobs were created in 2010-2015 than the chancellor could possibly have hoped for and the public finances have improved significantly, thanks to spending cuts combined with an expansion in the tax base. When we compare ourselves with every other country in Europe we are clearly heading in the right direction.
And yet? Should we be concerned that China is having a currency and growth crisis, Greece has another election, conflicts rage in the Middle East and the oil exploration in the North Sea is faltering due to price competition? These are a concern but the economy is growing. Wages are now growing quickly; inflation is at zero, and the living standards of the British people could rise by more in 2015 than in any year since before the banking crash. I do not say governments get everything right but I am certain that we are heading on the right track.
Fuller appraisal can be found here:
http://www.telegraph.co.uk/finance/economics/11799808/Fasten-your-seatbelts-theres-a-little-economic-turbulence-ahead.html

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