Beware the Triple Dip
0.3 per cent. In most people’s finances it’s not much of anything, a fraction of a fraction. Unless, that is, you’re talking about the GDP of the world’s sixth largest economy and the reputation of a government.
Thursday’s news that the UK economy has grown by 0.3 per cent in the first quarter of 2013 is no big shakes in terms of the nation’s finances. We all know the economy’s bumping along – shrinking a bit one quarter, growing a bit the next. Generally struggling to recover from the global banking meltdown which caused this mess in the first place.
But in terms of the credibility of the Chancellor and the Government, it’s big news and, following the loss of our AAA credit rating, you can bet George Osborne was mighty relieved to hear it. Watch his interviews following the news – it shows.
A Triple Dip recession was where we’d have been if the economy had shrunk in 2013’s first quarter. Two successive quarters of negative growth. Three recessions in five years, counting back to the Credit Crunch of 2008.
These are big terms, headline-grabbers, potent ammunition for political enemies, and the kinds of things which people remember when it comes to election time.
It’s not the economics that count – growth is bound to come eventually and, if it happens before the next election in 2015, ballots will be cast partly depending on whether people feel growth has been achieved in the right way.
But politics is increasingly a game played out through the media and you can bet the press would have had a field day had our GDP been just 0.4 per cent less than was announced – a massive blow to this Government’s credibility and popularity.
So the headline writers, the cartoonists, columnists and commentators will have to keep their powder and their whetstones dry for now. And Mr Osborne can sleep a little easier, knowing he’s got at least half a year before the Triple Dip nightmare can haunt his dreams again.
– Rupert Janisch, account executive, Forsyth Websper