Thursday 17 May 2012

Letter 66: Lack of growth and the effects of seeing austerity as "efficiency"

"Dear Dave and Nick,
I'm so sorry I've not been in touch recently. I've been glued to the news; local elections results (and their implications), Leveson, phone hacking, appeals to the common man in Essex, it's all been too fascinating to tear myself away. But though I'm back writing to you, in truth so much has happened in May, I hardly know where to begin. Hey.. how about growth and austerity? If you think about it, apart from Leveson that's really what most things come down to - or to be accurate, not enough growth and too much austerity. 

It's agreed: UK growth or lack of it is VERY worrying. Combined with spending cuts, it's no surprise both your parties did so badly in the local elections and Labour cleaned up. And yes, you're right Dave, it wasn't just mid term blues - broken promises (such as George saying in 2010 that the economy would grow by 4.3%) have really messed with your economic credibility. I'm sure you're aware that today Mervyn King has once more downgraded the UK growth forcast. Again. 

So who, or what's to blame? Surely not Labour; we've had Coalition for two years now. Or consumers, in employment but dealing with pay freezes that equal a reduction to their incomes in real terms, on top of increased prices in the shops? Are you really so surprised they're being so careful with their money? Maybe like me, hearing that GDP might not recover its 2007-8 level till 2018, they've decided to freeze their spending too. Yesterday George blamed the Eurocrisis, but I don't believe him. It feels like a convenient scapegoat and WE are in recession, not they.

                                                          (Page 2)
William Hague (secretly green I hear) and Eric Pickles, seem to think it's the fault of business leaders and they should just work harder, but surely they're already working as hard as they can and are waiting on a credible growth strategy from you? Maybe they'd appreciate you doing more on infrastructure? Say, investing in building more social housing? Winners all round there: not only would it get the building trade moving and unemployment down (with more full-time jobs), there'd be less need to move to Stoke or rent sheds from rip off landlords to live in.

I have to ask: could the problem be....austerity and Plan A? Though you said they'd get us out of our economic mess, here we are, limping along in a double-dip recession. What IS the magic answer for growth? You said that you "get it", but how's a voter to know it, when you turn up in Essex, renewing your commitment  to the same old same old? The success of Hollande, sworn in as French President yesterday, is in part about the growing belief that austerity is discredited as the solution.

I'm sorry, this is starting to sound academic and European - let's get closer to home. Take a look here: You'll find out about Rose Fernandez and the impact your austerity measures are having on her family. She struggles to support an elderly mother living with dementia and her adult autistic daughter. She's a "striver", so how is it you don't seem to be working for her? If you "got it", you'd realise that she saves the State a fortune by caring for her family in such a responsible manner -  shame then that your austerity measures make it increasingly difficult to do so. It does make me wonder - how many people like Rose or empathising with her situation, think either of you "get it"?

Yours, etc"

No comments: