Osborne’s blame game

George Osborne writes in the Sunday Telegraph today that the British recovery ‘is being killed off by the crisis on our doorstep.’ This sounds uncannily like Gordon Brown’s ‘it started in America’ excuse, and it’s only mildly more convincing. While Osborne blames Europe, and Balls blames cuts, there is no doubt that the British economy isn’t recovering, which is not good news for a chancellor whose re-election strategy was based on recovery by 2015.

But, by attributing blame to Europe Osborne risks blinding himself to a major problem in Britain. The economic headwinds are certainly strengthening. But the euro’s slump doesn’t appear to have halted recovery in countries that have delivered supply side reform (tax cuts, deregulation etc.), like Sweden and Estonia. Germany’s supply-side reform has taken its unemployment to 20 year lows. Like Brown, Osborne nudges corporation tax down; but this, as any business will tell you, is not their main concern. The