First, here’s Mandy’s comments to an exasperated (and sometimes almost speechless) Evan Davis on the Today programme this morning:
“The Treasury estimates that there would have been at least, probably far in excess of, 500,000 jobs lost in the recession had it not been for the Government's and the Bank of England’s intervention”
When asked, the Treasury points to an extract in Darling’s Budget speech on 22 April, when he said:
“Taken together, the total policy support for the UK economy is expected to protect up to half a million jobs.”
Over what timeframe? Darling didn’t say. But three weeks later, Brown pops up to make the same point in a party political broadcast - but claiming the jobs have already been saved. In his words:
“Thanks to lower interest rates and the action we have taken on the economy, almost half a million jobs have been saved or protected."
Anyone spot the other wobbler? The 500,000 figure includes the massive drop in interest rates to 0.5%. So this “jobs saved” figure is concocted by having someone at the Treasury guess how many more jobs would have been lost had the independent Bank of England kept rates as high as they were. Which was never, ever going to happen given that central banks the world over – from China to Switzerland – dropped rates sharply, and those with rates close to zero started printing money.
So why was someone in the Treasury commissioned to come up with this 500,000 figure to see what would happen if the Bank didn’t cut rates? What were the other scenarios: an asteroid hitting the City? The only possible purpose for such a calculation is to con the British public into thinking that jobs had been “saved” by the Brown stimulus when nothing of the kind has happened.
As far as I am aware, only one report has ever been done into the stimulus of November 2008 – by Oxford Economics, commissioned by The Spectator back in January. It found that 35,000 jobs (not 500,000, Prime Minister) would be “saved” by the stimulus this year. But higher taxes needed to pay for the stimulus will prevent a far greater number of jobs from being created in future years of the recovery. Some 91,000 fewer in 2012 alone. So Brown’s “stimulus” will cost far more jobs than it supposedly saves. I suspect the Treasury "study" was commissioned to cover this up.
There is something deplorable about the way Brown and Mandy can mislead the British public like this, make claims about half a million jobs saved then refuse to publish the basis of their claims. Obama published a detailed study (pdf) of how many jobs he thought his stimulus would save. He leveled with the American public: the deficit will be collected from your taxes, he said to voters, so here is what I think all this debt will achieve. All we get from Mandy and Brown is spin, and attempts to deceive journalists and the public.