Wednesday, 29 September 2010

Lessons across the Irish Sea from Ed Balls

Good conference rabble rouser there from Ed Balls, defeated in the leadership race but well placed to be rewarded with a top job - shadow chancellor is what he wants -in the shadow cabinet.

Education was his brief in the speech but he ranged across the Lib Dems, the disappointment of Michael Gove and, he couldn't help himself, the economy. After all, this was basically a job application and love letter to the leader, but it was a good speech.

There was an interesting passage about Ireland, the Celtic Tiger, which was being held up to Scotland not so long ago as the model of economic growth an independent nation should follow.

Here's what Balls said:

"We don’t need to go back to the history books to see the warning signs
over George Osborne’s economic policy - we only need to look across the
Irish Sea.

Two years ago, the Irish Government convinced itself they had to slash
public services and cut child benefits to get their deficit down as fast as
possible and reassure the money markets.

The IMF praised the Irish government for its "sense of urgency".

And what has happened since?

Recession turned to slump, unemployment at a 16-year high, 19 consecutive
months of deflation, consumer spending and tax revenues plummeting, and the
deficit worse now than when they started.

The Irish Economist David McWilliams said this week:

"It is like watching a slow car crash. The more they cut, the more the
economy will continue to stagnate.”

George Osborne used to say that Ireland has so much to teach us, if only we
were willing to learn.

Now he's the one ignoring the lessons.

Just imagine if Alistair Darling and Gordon Brown had listened to David
Cameron and George Osborne in 2008 – and not nationalised the banks, not
cut VAT, not invested in a new jobs programme – recession would have turned
to depression and unemployment would be much higher today."

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