Yesterday, Sunak announced that the economy is pointing in the right direction.

I expect he is looking forwards. The indicators of recession are based on past performance.

It’s obviously the fault of the last Labour government. Or Starmer. Or both. Yes, both. Both is good.

Its a very mild shallow recession brought about by the bank of England interest rate increases, which have stifled growth. Looking forward, yes the future is much brighter wrt economics

And the front page headline in the Financial Times is about Hunt looking at cutting public services to 'pay' for tax cuts.

It's economically bonkers. All that cutting public services will do is take even more money out of the economy. There isn't going to be any private sector investment unless the private sector can see an opportunity for profit from their investments. Which it won't if the money in the economy is cut even further.

I just do not understand why this madness is continuing...

karmalady

Its a very mild shallow recession brought about by the bank of England interest rate increases, which have stifled growth. Looking forward, yes the future is much brighter wrt economics

Where is this magic growth coming from which is going to bring a brighter future?

Growth has been stagnating for months.

I just do not understand why this madness is continuing...

Scorched earth tactics? They believe they are going to lose the next election, so are going to leave the next government in the worst possible position in the hopes it will then be there for just one-term.

Or sheer bloody incompetence combined with an ideological hatred of public services, and a need to propitiate their core voters (see also immigration).

It puzzles me how they continue to sell the narrative that they are fiscally capable.

£2.5trn debt

No growth

Highest taxes

Poorest public services

Failing NHS

Austerity

Covid
War in Ukraine

Germanshepherdsmum

I expect he is looking forwards. The indicators of recession are based on past performance.

Absolutely.

I hope you’re right GSM but I doubt it …

Add Brexit and Liz Truss to that list GSM , funny how govt supporters never mention that when trying to account for the dire performance of the UK economy.
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Gosh, some rather Pollyanna attitudes on here this morning. And stating "the bleedin obvious" ...."indicators of recession are based on past performance" oh, that's alright then

Most of Wwmk2's list predates both covid and the war in Ukraine.

the bank of England and rising interest rates, they are the ones who have stifled growth. Thy are an entity which makes their own decisions, nothing to do with government

Meanwhile we are spending billions on asylum, much of which is illegal

Do we include Gordon Brown in the list?

If there is one lesson Sunak hasn’t learned yet it is that when economic figures are expected, don’t make a big announcement the day before. He makes himself look incompetent because he grabs on to the smallest ‘good news’ story without checking what is coming next.

Tory supporters tend to blame COVID, strikes, Ukraine, etc., but many NHS targets have been missed with year on year deterioration since 2014 (as in the case of 62 day waits for cancer treatment - missed now by 40% of patients) and there are grave concerns about maternity care. The Tories have failed to improve productivity and according to a recent study the UK is now 21st in a list (headed by the UAE) as the best country to start a new business. If Sunak thinks the economy is pointing in the right direction he needs new spectacles.

Why is our GDP 0.1% when USA is +6% , EU + 2%. ? They’ve all had Covid/ been affected byUkraine ( some even more than UK). Goldman Sachs has said Brexit has hampered our growth - not exactly rabid left wing organisation - Sunak used to work for them even.

Jeremy Hunt just said on tv that all the things that have happened with the economy were anticipated by the government. If that is the case can he not tell us exactly what is going to happen in the near future?

karmalady

the bank of England and rising interest rates, they are the ones who have stifled growth. Thy are an entity which makes their own decisions, nothing to do with government

Meanwhile we are spending billions on asylum, much of which is illegal

Straight out of the right wing blame book. Surely nobody is so economically and politically ignorant naive as to believe that the economic catastrophe in this country is down to a few desperate individuals claiming asylum?

We actually had a growth spurt in 2021 when people spent money they had saved during the covid restrictions; growth has flatlined since then.

Doesn't that give a bit of a clue as to what is required to drive growth?

Whilst not excusing the current government, other countries are also slipping into recession, it’s probably time to look at the bigger picture.

some might be interested in Ann Pettifor's latest blog post. It focuses on financing the NHS, but the 'multiplier effect' which would result from investment in the NHS would apply to most areas of state investment.

(Note she also says that spending comes before taxation)

annpettifor.substack.com/p/how-to-pay-for-health-and-the-just

Richard Murphy recently published a very long post to show how money flows through the economy, with diagrams. A section of it covers state investment. It's also worth reading.

www.taxresearch.org.uk/Blog/2024/02/12/tax-and-money-flows-within-the-economy/

Everyone has had Covid and Ukraine, but only we have had BREXIT, and I'm sure that folk on here will be able to convince me that BREXIT has nothing to do with it.