The US economy grew by 1.7% in 2011 compared to 0.9% in the UK - almost twice as fast. The new figures put to bed Treasury spin that the two economies were on the same course.
New figures out today show that the US economy grew by 0.7 per cent in the last quarter compared to a contraction of 0.2 per cent in the UK. The final figures for 2011 put to bed Treasury spin from the autumn that the UK was doing as well as the US.
On the morning of the last US GDP figures in November, ITN’s Laura Kuenssberg tweeted:
“Treasury sources say UK grown at same rate as US so far in 2011”
As I blogged at the time, this was only true because of the boost to GDP in Q1 caused by the added economic activity following heavy snow at the end of 2010. With full 2011 figures out for both countries, we now know that while the UK grew 0.9 per cent last year, the US grew by 1.7 per cent.
Indeed, while the UK economy has contracted in three of the last five quarters and may already be in a double-dip recession, the US economy has not contracted since the second quarter of 2009.
The US has taken a slower approach to deficit reduction than the UK with cuts only starting to bite in 2013.
And while George Osborne has blamed the eurozone for the latest downturn, research by the House of Commons library has shown that it was only trade that ensured the economy was growing at all in 2011. Surely now it’s time for Osborne to accept the need for a Plan B.
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• Growth revision shows economic recovery is off track – Tony Dolphin, January 9th 2012
• UK growth – bottom of the table, wallowing with the PIGS – Daniel Elton, November 28th 2011
• UK set for among slowest growth in EU – Will Straw, November 11th 2011
• UK growth down as IMF warn deficit reduction should not be at the expense of growth – Shamik Das, October 5th 2011
• No growth? ‘Keep calm and carry on’ says Osborne – Ben Fox, October 4th 2011