Column for Ilford Recorder 11 August 2011

I spent last week on holiday in Chicago.  US TV channels are dominated by the mad monetarist views of “Tea Party” Republicans and the crisis they created in the US economy and politics. I got home to news of the crisis created here by similarly misguided policies. The Office of National Statistics say the British economy grew by just 0.2 % in the second quarter of 2011.  It has been almost flat for nine months compared to 2.1 % growth in the previous nine months under Labour.  The economic recovery was recklessly choked off by George Osborne’s 2.5% VAT rise in January and the Conservative led Government’s spending review. Cutting further and faster than any other major economy caused confidence to fall. The whole world faced challenges like high oil prices but other economies continued to recover while Britain has barely grown at all. Osborne ripped up the foundations of the house as the global economic hurricane was brewing - undermining our recovery well before the recent problems in the Eurozone and America and leaving us dangerously exposed if things now go wrong there. Instead of clutching at excuses like too much snow in winter or a Royal wedding in the spring Osborne only has himself to blame for the choices he made a year ago. Spending cuts which go too far and too fast are hurting, but it’s increasingly clear that they aren’t working. Slower growth and higher unemployment are creating a vicious circle with borrowing already set to be £46 billion higher than the coalition predicted. The Government should listen to the IMF and the Federation of Small Businesses who have called for temporary tax cuts.  It should force the banks to lend to small businesses and repeat the bank bonus tax to get young people off the dole and into work.

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