Friday, 25 January 2013

Flatliners

Nick Clegg started the day by doing his usual distancing act from impending bad news. This time it was an admission that government cuts in capital spending had been too great on his watch. Most journos dutifully reported his comments and then dismissed them - mostly because few think the deputy PM had any actual influence on the matter anyway.

The other reason was that it was clearly an off-stage attempt at contriving a remedy in the light of impending bad news that last quarter growth in 2012 was rubbish. 

In a report full of euphemisms like 'bumpy' and 'sluggish', the Office of National Statistics confirmed what most economists were predicting which is that growth is negative and that austerity is damaging the prospect of improvement.

Earlier in the week, George Osborne dismissed recent comments from IMF chief economist Olivier Blanchard for a rethink on spending cuts. His view is that pension, education and welfare 'reforms' would make the UK a more competitive economy. Meanwhile, he insisted, cuts to corporation tax and higher-rate tax were making the country a more attractive place to do business.

The inconvenient fact that neither UK-based service or manufacturing sectors seem to benefiting from this approach was not mentioned. Perhaps it will come up in Davos.

Update: Further news to put Cameron on the piste will be that his referendum grandstanding appears to have had zero impact on polling figures.

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