SO THE recession is over. Storm the Bastille, set the city alight and party like it's 1799… or rather 2009. Unfortunately, the return of our economy to growth will no more end our troubles than the French Revolution lavished liberty, equality and fraternity on its people. What they got instead was the Reign of Terror.
Recessions are long in their making and require an equally lengthy recuperation before the patient can be said to be back to health. Compound infections require more time still.
Our economy may be getting the thumbs up from the men in white c
oats, but we are still left with a semi-derelict banking system, Government borrowing at peacetime highs, and rising unemployment.
I hate to depress anyone, but after the recession of the early 1980s unemployment went on rising for seven years before the numbers started to come down. Indeed, they didn't reach the pre-recession 1.1 million jobless total until 2000, an agonising 21 years later.
On this basis, unemployment could keep rising until 2014, and might not reach pre-crash lows until anything up to nearly 2030.
There are plenty of reasons to draw parallels with the chaotic years of the late 1970s, featuring a banking crisis, soaring oil prices and politicians wrestling impotently with nationalised industries they were clueless how to manage.
By 1979, public sector workers had manoeuvred themselves into a powerful position, bringing services to a standstill throughout the Winter of Discontent. "Only on the inside can you know the fantastic waste of public money," Lord Harris, one of Labour's original spin doctors, admitted during an off-the-record briefing with journalist Hugo Young.
Last week began our own vacuous debate over the level of public spending, with the parties arguing over Tory cuts against Labour spending increases.
No mention was made of the provision of those services, ie what we get in return, as though spending money were a virtue in itself. That's a lesson we might have hoped we had learned by now. Confucius, who unlike Robespierre was a quiet, peaceful revolutionary, said as long ago as 500 BC: "He who will not economise will have to agonise."
Everyone in Britain knows that our economy cannot begin to resume the kind of dynamic growth which produces jobs and offers our children a future, without reducing our shameful burden of debt.
Yet Labour continues spinning this risible fiction that public spending will continue to rise.
We are not idiots. We know there are only two ways these debts can be reduced. We either cut spending or raise taxes. Taxpayers have had their fill of watching their pay packets disappear to meet ever rising demands of central and local government bureaucracies over which they have no control.
After the MPs' expenses scandal, any attempt to increase taxes on the mass of the population could lead to riots. As it is, poor staff at HM Revenue & Customs (whoever thought we'd feel sorry for them) are having to cope with hoards of abusive taxpayers telling them which part of their MP's anatomy they can shove their latest tax demands.
No, there is little joy on the horizon. Rather I sense an almighty clash is coming, and it is the same conflict which tore Labour apart in 1979. But as Confucius said: "When you embark on a journey of revenge, take two coffins with you."
Council gaffesWHEN it comes to cuts, a good place to start would be with the financial managers of local authorities who invested council tax payers' funds with the Icelandic banks that crashed.
The Treasury Select Committee last week criticised them for risking £1 billion, as well as the Audit Commission, which had invested £10 million in Iceland. It is just another example of the incompetent and careless attitude of the public sector towards our money.
It is easy to forgive ordinary investors for placing their money in Iceland, not knowing the risks, although I am glad to say we did not receive correspondence from a single reader that had done so. But then we had run articles warning of the situation.
Perhaps councils should start elementary reading classes for their top bosses. Hang on, that was not a serious suggestion for more spending!
Safety in numbersSCOTLAND might soon have access to repossession numbers, something this column has called for on several occasions.
The Scottish Government plans to ask the FSA whether figures could be collected for Scotland for the first time. As we have often said, if you don't count the numbers, you don't know if you have a problem, or indeed how to solve it.
