by Peter Franklin
Thursday, 13
August 2020
Reaction
11:12

‘Recession’ doesn’t begin to cover it

by Peter Franklin

Minus 20.4%. That’s the latest quarterly GDP ‘growth’ figure for the second quarter of this year. There was a (much smaller) decline in the first quarter too — so with two quarters of negative growth in a row, this meets the conventional definition of a recession.

Indeed, that’s how the mainstream media headlined the news. For instance, the BBC went with “UK officially in recession for first time in 11 years”.

Every word of that sentence is true, but it’s also irrelevant — in fact, utterly inappropriate. To compare this recession with the last one or any other on record, doesn’t make sense. Just take a look at the chart used to illustrate the BBC report:

Squinting really hard, I think I might see a subtle contrast between the contraction this time and last time… oh yes, it’s a whole order of magnitude worse!

There is nothing remotely similar to this in the economic record, so why on Earth are we using conventional terminology like ‘recession’? It’s like calling an earthquake a ‘vibration’ — technically correct but thoroughly misleading.

Normalising what’s happened to us in 2020 legitimises a conventional narrative when what we desperately need from our politicians is unconventional thinking. It’s therefore deeply dispiriting to read the Shadow Chancellor saying things like this: “A downturn was inevitable after lockdown — but Johnson’s jobs crisis wasn’t.”

Johnson’s jobs crisis. I really hope Anneliese Dodds has more to contribute than petty soundbites. Given the lockdown measures that she and her Labour colleagues were in full agreement with, can she present any vaguely plausible scenario in which a jobs crisis would not have resulted? Suspend normal life and really bad stuff is bound to happen — even if it was our least worst option.

Whether one believes the lockdown to have been necessary or not, one thing we ought to agree on is that we’re in a situation without precedent. If we can’t even find the language to reflect this undeniable fact then what chance do we have of finding a solution to our predicament?

By the way, the need for new language also applies to the Government. The latest monthly GDP figures show that the economy grew by 8.9% in June. Ministers could choose to call this ‘recovery’ or even ‘record growth’.

Again, this would be technically correct — and again it would be meaningless. The rebound, while better than continued collapse, means that we’re only a bit of the way back to normality.

So I hope that our leaders, unlike the Opposition or the media, rise to the occasion. Extraordinary times require extraordinary words. Let us pray that extraordinary deeds might follow them.

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  • October 19, 2020
    I think they've been staving recession off for a while with dodgy "help to buy" schemes and desperate money printing aka "quantitave easing". This is the final nail in the fake economy where people have to consume excessively and companies expect 20% return on investment just to keep the big wheel... Read more

  • August 19, 2020
    Well Labour have galvanised themselves to have a view on how covid has been managed by the current Government (sic) - and decided that the lockdown was imposed too late. This narrative turning up regularly in the mainstream media unsurprisingly of late. It seems an ex- Labour voter I'll remain -... Read more

  • August 18, 2020
    I totally agree with you. My politics are like yours (left) and yet these "representatives of the left" are nothing of the sort. Absolutley all opinion is that Boris has not done enough lockdown NOT ONE FRICKING WORD stating it was totally wrong. I see no difference between left-middle-right from... Read more

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