Knifonomics (part 10): clear thinking amid the chaos

The Chinese were doing their bit to save the planet

Party politics is always likely to be a confounding factor in dealing with the economy. Clarity of thought is rare, but it often goes hand in hand with clarity of expression.

The Knife wishes to recommend, again,  two true masters of this craft, Hamish McRae and Nigel Lawson. I know the latter was a Tory chancellor, but he’s well past worrying about party dogma, and remains sharp as a…well..knife.

McRae in the Independent offers a judgement of the last year’s policies that neatly summarises the issues: growth OK, exports good, employment promising, deficit correction and credibility good,  inflation bad. The ghosts of Ed Balls and the ludicrous David Blanchflower ** are absent.

Lawson concurs, in the FT, noting: ” disappointing though the pace may be, the fact of the recovery, as fears of the dreaded ‘’double dip” either globally or nationally recede, is incontrovertible.

He also worries about inflation, and highlights the fantastically inappropriate Coalition commitment to what he accurately calls “the self-inflicted wound of the Climate Change Act”, with the observation:

The government likes to boast, as did its Labour predecessor which launched this foolish policy, that the UK is the only country in the world that has imposed severe and legally binding carbon reduction requirements on its economy. The claim is correct; but why the government should boast about it is puzzling, since the reason why the UK is the only country to do this is that no other country wishes to incur such pointless self-inflicted economic harm.

The Knife thinks that we’ve not heard the last of this. Huhne’s impending demise and Osborne’s electoral strategy suggest that  it’s probably still “negotiable”.

** Where does Blanchflower actually pay tax? He is a party political obsessive Brown/Balls fan who amazingly got to lecture us all and decide monetary policy on the relevant committee of the Bank of England. However, he seems to live (and earn his money) mostly in America. When he’s not playing golf, that is.


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