The recession: four years and counting

TrevorsDen

It shows the part re-arming played in coming out of the 31 recession.

Jay

It was surely electrical consumer products and house-building that primed the 30s recovery. Arms expenditure was only later.

Cynic

"Even after the Great Depression of the 30s, the economy had fully recovered by this point." But at that point, it was realised that war was inevitable and re-armament was taking place. Thankfully we do not have that scenario - yet.

Rich

Silly myth invented by uber-Keynesians that military expenditure got Britain out of the 1931 recession.

Nobody (except maybe Churchill and a few others) was thinking about rearming to prepare for war until near the very end of the decade by which time the economy had recovered quite nicely by international standards.

Heartless Curmudgeon

At least we may find comfort and solace in the thought, that the Great Economic Pretender had Nothing To Do With It, - It was Not His Fault!

What a darling man.

roughyed

Defence spending stayed flat until 1936, i.e. a couple of years after the period shown in the graph. See here... http://www.ukpublicspending.co.uk/spending_chart_1930_1940UKp_11s1li011lcn_30t

Tarka the Rotter

@cynic - they're working on it...

Colin Cumner

Citing the re-armaments programmes of the late 1930s as 'solving' the social and economic aftermath of the Depression era overlooks the fact it also plunged Germany and the Western democracies into huge debt which has lingered long beyond the immediate post-war period. Massive public and private debt is what hinders economic progress and until nations learn to live within their means and not to get bogged down in the morass of military 'adventures', future generations will face continuing hardship.

daniel maris

It's pathetic - how can you even mentino the OBR as an authority when they have been so SPECTACULARLY WRONG about just about all their forecasts.

Also, when is someone going to mention the obvious fact that - unlike in 1930s Britain - we are taking in an additional 500,000 people every year. Per capita GDP performance is FAR worse than the total GDP figures suggest, thanks to mass immigration.

oldtimer

The best that the UK economy can hope for, over the next several years, is to flatline. Government spending, tax and energy policies will ensure this dismal outcome.

Scary Biscuits

We need to stop using GDP as a measure. As well as convincing economic idiots like Blair to support immigration it has persuaded virtually everybody else that public spending is a good thing - because this is included in the GDP calculation.

What we should be measuring is GVA (Gross Value Added) per person. This would strip out both government spending and the effect of immigration and be a much better measure of whether we are getting richer or poorer.

Ian Walker

Without wishing to sound like one of the Occupy nutters, when massive amounts of wealth are concentrated in fewer and fewer individuals, who operate as a de facto cartel, recessions will inevitably be longer as the money supply is effectively strangled.

But until we start taxing wealth (hoarded wealth retards growth) instead of income (high income being spent promotes growth) then we'll never get out of the morass. Unfortunately, the fabled one percent pull all the strings at the top table, so don't hold your breath.

Johnnydub

Ian,

The problem with taxing wealth is that Governmwents won't do it as an alternative to income taxes but as an addition.

The problem is simply too much government - and no government of any flavour that I am familiar with is ever in favour of reducing in size or budget or headcount.

Colin Cumner

As a postscript to my earlier posting, it is worth mentioning the fact that the wealth piled up by some individuals is not necessarily from manufacturing or other such industries but from being able to kick a football, display a fashionable dress or acting out life on the silver screen - big money at that - and none of which is very productive for the nation. We have to get back to basics - create manufacturing jobs, fill the vacancies in the nursing and aged care facilities and similar vital 'industries' and get away from the froth and bubble activities that generate huge wealth for individuals but do not do a great deal for the nation overall.

Cass2001

The graph says it all. If the upward trajectory at the time of the election had continued rather than being derailed by ConDems policies and scary talk -quote "the economic equivalent of war!" - then we would be back in positive territory by now.