My latest article in the Cornish Guardian addressed recent
data published on economic performance. It was as follows:
Statistics have been at the core of recent arguments about
the economy, with political and other groups focussing on different aspects of
the data.
According to the Office for National Statistics (ONS), the United
Kingdom economy grew by 1.9% in 2013 – the
strongest rate of growth since 2007.
The Chancellor of the Exchequer predictably welcomed the
figures and used them to claim that the Government’s economic policies were
working. He was reported as telling the
BBC that: "There is plenty more to do, but we're heading in the right
direction."
Equally predictably, others disagreed with George Osborne. Many
preferred to comment on the “cost-of-living crisis” suffered by many working
people, who are struggling to pay their bills and can see no recovery at all.
So who is right?
Well, the ONS may be recording growth for the United
Kingdom as a whole, but the regional picture
is very varied. Much of the recent growth has, once again, been centred on London
and the South of England – while other areas have fared much less well.
The latest “county” figures – dating to the previous year of
2012 – show the Cornish economy had slipped back during the last two years. It
is now the region with the lowest economic performance, at only 61.2% of the UK
average.
George Osborne claims he is “rebalancing the British
economy." I feel it is about time he attempted to tackle the unbalanced
nature of Britain ’s
economy and the massive difference between the various regions.
The Institute for Fiscal Studies (IFS) has meanwhile
published a report which shows that living standards have fallen dramatically
since the recession began. And economists believe they will not reach
pre-crisis levels for a number of years.
The report found that between 2008 and 2013, inflation rose
by 20%, while energy prices shot up by 60%, with food prices increasing by 30% over
the same period. As a consequence, the income of a “mid-range” household is estimated
to be about 6% below what it was pre-recession.
The report also found that the impact on poorer families is even
more severe, because a much greater proportion of the spending of the
less-well-off goes on the inflated cost of food and energy.
And if that wasn’t bad enough, it is many of these poorer
families that will be squeezed even harder with the Government’s incoming cuts
to benefits and tax credits.
2 comments:
The only people benefitting from the "recovery" are thepeople at the top, primarily from the South East of England(London). By the way that happens to be the only part of the UK that the Westminster government has any interest in. Countries like Kernow,Wales and Northern Ireland are left to heir own devices without the tools to effectively address the problems.
As long as we are controled by Westminster I fear matters will only get worse. Let us hope the people of Kernow and Wales will follow Scotlands example and vote for their freedom when given the opportunity.
The recovery is temporary:
1. The national debt is still growing fantastically fast. The 'cuts' have so far lowered the increase in debt by a third, which means two thirds of the cuts are yet to come.
Total debt, including unfunded obligations , has now exceeded 900% of GDP - and that is unrepayable under almost all circumstances.
2. Most of economic growth is based on the availability of cheap energy (nowadays we all have the privilege of the energy equivalent of about 70 slaves each - but slaves that don't cost money to keep - they don't eat, sleep, get sick or die. They just work for us. But now they are four times more expensive than the long term average and that is largely responsible for the near financial collapse.
The world is now limited to only modest economic growth. If that is exceeded, energy prices will skyrocket and we will return to a slump.
As fossil fuel fields are depleted over time, the limit on world economic growth will gradually reduce down to zero, followed by negative growth limit. That's when the real fun begins.
In Cornwall we need to be aiming at self-sufficiency and resilience at whatever lower standard of living we can maintain, not trying to go for growth, which, almost by definition, is bound to fail.
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