Economics

Now that Mervyn King has given his last press conference and spotted some green shoots of his own, attention is turning to his successor, Mark Carney. He is being portrayed as the man on the white horse riding to our rescue. He has been very successful in Canada and I wish him well. But I do hope he is well prepared for the English press. Reports suggest that the Chancellor will urge the new governor to increase ‘quantitative easing’ (QE), the printing of money or the buying up of the government’s own debt in order to speed up the recovery. I hope the new governor will exert his independence and

I was surprised to be told, by the editor of this magazine, that next week will mark the 20th anniversary of my standing down as Chancellor. The anniversary had entirely passed me by. I was asked this week why, if the economy was turning, George Osborne didn’t announce that he had spotted ‘green shoots’, as I observed in 1991. Although my remark, much rubbished at the time, turned out to be surprisingly prescient, I think Osborne is right to be cautious. Economic statistics are revised so often, trying to steer the economy as Chancellor is, as Harold Macmillan observed, like trying to catch a train using last year’s timetable. The

With the debate swirling about Margaret Thatcher’s legacy and her government’s record, it’s worth taking a look at what the cold, hard economic data has to say about her time in office. Of course, growth rates and unemployment figures can’t tell us everything about a period, but they can at least provide a bit of substance to mix with the well-worn rhetoric. 1. Average growth. Under Thatcher, GDP rose by 29.4 per cent — an average of 0.6 per cent growth per quarter. (That’s the same as the average growth rate from 1955 to 2013.)   2. Manufacturing jobs lost, but more service jobs created. A net of 1.6 million

Before every Budget, George Osborne always seeks the advice of various MPs. He usually doesn’t heed it but it’s a good way, he thinks, to keep the troops happy. As the economic headwinds have strengthened, this advice has tended to be increasingly radical and in a recent meeting with the Free Enterprise Group of Tory MPs, the Chancellor made clear he was in no mood for it. ‘Look,’ he told them, ‘I tried radicalism in last year’s Budget, and I had blowback for it. So I’d take quite some persuading to do something radical this time.’ The MPs left with the clear impression that he is now preparing what will

Does George Osborne need to adopt a Plan B? This will be the topic for a Spectator debate a week on Monday. But the argument is pretty clear to everyone with even a passing interest in the trials of George Osborne. Let’s look at the story so far. His Plan A – accelerated fiscal consolidation – was based on two key premises:  there was no alternative to cutting the deficit much more sharply than previously planned, because otherwise the markets would panic and long-term interest rates would rise sharply.  As one Treasury Minister put it: ‘Britain’s AAA credit rating was under threat…George Osborne had no choice but to come up with

Roger Bootle is managing director of Capital Economics, and winner of the Wolfson Economics Prize. As the government launches another attempt at boosting UK growth, the economist, who describes himself as a ‘rare right-wing Keynesian’ shares his thoughts on ministers’ economic prowess with Coffee House readers. Do you think the government will be able to fight the next general election on the issue of the economy? ‘I think it’s too early to tell, but if the economy is completely flatlining and the deficit does not go down – which seems to me to be perfectly possible, there are strong signs things are going to look bad for them. But the