October 24th 2009

More shock and errr. What's been obvious for more than three months - that only taxpayers' money and 0% interest rates are keeping SS Blighty afloat - has once again served to 'astonish' Darling, Brown, Dither & Cockup.

As we've had occasion to note before, it seems to be the way with officialdom these days that every trend, statistic and event comes as ' a complete surprise'. The latest ones on the UK economy went a step further by 'shocking' those allegedly in charge of ops.

As Edmund Conway points out in today's Telegraph, it's hard to see why anyone would be surprised: the structural problems in the UK economy have been stressed again and again both here and elsewhere. The 0.4% decline in quarterly output is underlined by a YOY drop of 5.2% - showing conclusively that we are not 'coming out' of anything....but rather, flatlining at the bottom of the pit.

The scale of the lies put about by our Minister for Funny Business over the last few months will serve to shock future historians, and act as a warning to their students about the wages of spin. But more to the point, October 23rd 2009 will be remembered by electoral geeks as the day New Labour's election fate was finally sealed. There may be little enthusiasm for Cameron and Osborne (who didn't see the initial crisis coming either) but there is no patience left in the pot for mendacious incompetents.

The mendacity has chiefly surrounded the problems unique to Britain. That is to say, its peculiar over-dependence on financial services, and thus the hammering our income took when an unbridled lending binge turned into the biggest bailout in the nation's history. France and Germany enjoy two contrasting advantages over the UK: they grow more stuff and make more stuff on the one hand - and lend more sparsely on the other.

But the central pot of EU gravy will have several large holes in it once the northern and east European debts come a-drilling....which is why we still believe that come the Spring, the Euro will be in trouble and Sterling will gain by comparison. Given all the drivel spouted by New Label over time about 'talking down' the Pound, at that point the Tories should do everything in their power to focus on how they will at least balance the books and demonstrate a degree of thrift. This would be both the patriotic and commercially sound thing to do.

Meanwhile, both they and the Government remain action-free and clueless on the urgency of developing new manufacturing skills alongside greater agricultural use of land. When the grow-stuff push meets the build-stuff shove, tough decisions will have to be taken. I see no sign that this Establishment (of whatever hue) has the right stuff required to face it.

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