By Peter Hoskin
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may have decamped to their constituencies for the summer, but the routine business
of Westminster continues. In particular, this week, we’ll have the usual political
over the latest growth figures. Most economic soothsayers expect them to be
rather encouraging – twice as big as the rate
achieved between January and March – and the latest sign that Britain is
returning to sustained growth. George Osborne will be pleased.
what about Labour? What’s their shtick going to be if we keep on growing? The
answer is in an article by
for today’s Guardian, in which he basically does two things. He tries to put
this recovery in an unfavourable context, talking of how “we would actually
need to see growth of 1.3% a quarter for the next two years” to “catch up the
ground we have lost on growth and the deficit since 2010”. And he asks the fundamental question:
recovery for whom? To which, conveniently, he already has his own answer: “there
are growing signs that this nascent recovery is mainly benefiting those at the
New Statesman’s George Eaton calls this a “smart line
Myself, I’d qualify that by saying it’s not smart in the sense of requiring
much mental effort. Labour were always likely to need a weapon that could be
wielded in a growing economy, and re-forging Miliband’s “squeezed middle”
thesis was the obvious choice. If anything, Labour should never have let the
it is smart insofar as it’s got some truth behind it. Sure, Balls is
exaggerating when it comes to the richest – as the Resolution Foundation points out, “the
latest year saw the biggest decline in income inequality in the last 50 years”.
But when he writes that “most families are not seeing any recovery in their
living standards, with average wages after inflation still falling,” he’s some
way closer to reality. As we know from the monthly
the growth in wages is still being outstripped by prices, and that is likely to
continue into next year. The squeeze prevails.
many respects, this is dangerous for the Tories. People may not notice the
political class rowing over fractions this week, but they’re sure as Hell going
to notice the numbers writ in black-and-white on their supermarket receipts and
energy bills. Any notion that things are tougher than they used to be will be
bad for Tory chances.
George Osborne isn’t defenceless. He already has policies – more than Labour – for
improving living standards; he has groups like Renewal coming up
with new ideas; and, crucially and increasingly, he has growth. Britain’s
recovery may not be evenly spread nor particularly fast-paced, but it’s still a
recovery. The Chancellor, in this case, might take solace from the fact that
Balls has refined his attack.