George Osborne has again blamed the double dip recession on the eurozone - the truth, however, is the causes of the recession are primarily domestic.
.
George Osborne makes a familiar argument today, seeking to blame the double dip recession on the eurozone. The truth is the causes of the recession are primarily domestic.
In the Sunday Telegraph, the chancellor writes:
“Our recovery – already facing powerful headwinds from high oil prices and the debt burden left behind by the boom years – is being killed off by the crisis on our doorstep.”
While Britain’s economy contracted by 0.3 per cent in the first quarter of 2012, Germany grew by 0.5 per cent while both France and the Eurozone avoided recession with a flat economy.
Although trade was a very modest net drain on GDP in the first quarter, this was due to a rise in imports rather than a fall in exports.
The ONS’s most recent trade release found:
“The deficit in trade in goods with EU countries widened by £0.7 billion to £4.5 billion in March, compared with the deficit of £3.7 billion in February, as exports were virtually unchanged at £13.2 billion (up by 0.1 per cent), and imports rose by £0.8 billion (4.4 per cent) to £17.6 billion.”
A much larger contribution to Britain’s double dip recession was a 4.2 per cent quarter-on-quarter drop in gross capital formation, or investment (see Annex B).
• Eurobonds are about solidarity, which is not Cameron’s strong point 8 Jun 2012
• Austerity Isn’t Working • Sparpolitik ist keine Lösung • L’austérité ne marche pas 28 May 2012
• Europe’s right still full-steam ahead on mad dash for austerity 16 May 2012
• Will President Hollande be able to turn France – and the Euro Area – around? 8 May 2012
• Osborne’s ideology-driven economics have failed: We’re all paying the price 25 Apr 2012
Readers should remember that this is not the first time that Osborne has wrongly tried this trick.
No wonder the shadow chancellor, Ed Balls, says today:
“It’s deeply complacent and out of touch for George Osborne to blame Europe for a double-dip recession made in Downing Street. He will fool nobody with these increasingly desperate excuses.”
To reach hundreds of thousands of new readers and to make the biggest impact we can in the next general election, we need to grow our donor base substantially.
That's why in 2024, we are seeking to generate 150 additional regular donors to support Left Foot Forward's work.
We still need another 124 people to donate to hit the target. You can help. Donate today.
30 Responses to “Osborne wrong again in passing buck to eurozone”
BevR
Osborne wrong again in passing buck to eurozone http://t.co/9N1NboUa STOP blaming everyone/everything else and take RESPONSIBILITY
Magapanthus Smith
Osborne wrong again in passing buck to eurozone http://t.co/9N1NboUa STOP blaming everyone/everything else and take RESPONSIBILITY
Magapanthus Smith
“@britishroses1: Osborne wrong blaming eurozone http://t.co/xFUyB1Ym STOP blaming everyone else and take RESPONSIBILITY”
Refer to pickles
Lord Blagger
Primary cause – government debt. The 1 trillion borrowing and 6 trillion hidden off the books.
Shifting Grounds
Osborne is wrong in passing the buck to the Eurozone writes @wdjstraw for @leftfootfwd http://t.co/7nN5EnEP