So the papers have picked up on a set of stronger-than-expected results in the housing, manufacturing, and services sectors, and are now talking about “new hope” and “economic fightback”. As Mike Smithson asks over at Political Betting: are these the headlines that Brown has been waiting for? Well, given what we hear about Brown’s green shoots strategy, they probably are. But, like Smithson, I doubt they – or the potential recovery they herald – will do Brown much good.
There are plenty of reasons why. For starters, there are the political trends. The tide has turned against Labour for reasons other than the economy: everything from Smeargate, through the expenses scandal, to the party’s congenital infighting and discord. An economic recovery won’t negate this wider loss of confidence in the government, particularly as Brown will most likely take the rap for leading us into recession in the first place. Yet even if folk do come around to the “Brown, Our Saviour” narrative, it’s still unlikely to do Labour all that much good – Smithson highlights some fascinating figures from the eve of the 1997 election, which show the Tories were more trusted on the economy than Labour. And we all know how that turned out.
And then there are the economic trends. Sure, the good news stories of today are compelling – as is some of the positive data that’s come out in the past few months. But there’s still plenty of cause for concern. To my eyes, it seems that many of the underlying problems in the financial services sector haven’t yet been resolved: a situation crystallised by the horrendous banking results of the past few days. And many respectable economists – and, seemingly, more and more people around Westminster – believe this could help trigger another slump; the dreaded W-shaped recession.
Worst for Downing Street, through, are the unemployment figures. As a lagging indicator, they’ll almost certainly keep on rising from now until the next election (and beyond), whether the economy recovers or not. It’s a double whammy for Brown: not only will they undermine any talk of a recovery, but they’ll make that talk look callous and uncaring. Some Tories actually hope Brown will start grandstanding about “green shoots” in the near future – just so they can make that point.
In the end, the only substantive boost that Brown may get from today’s headlines is within his own government. You can expect some “right man for the job” bluster on his part, if only to stave off a fresh bout of leadership speculation in October.
Comments