Tuesday, 2 December 2014

Do you agree with Danny Alexander?

Extract taken below from an interview by Robert Peston, BBC Economics Editor, with Danny Alexander on the eve of the Autumn Statement announcement. I have chosen this particular bit because I truly don't know how the Lib Dems will win votes on the back of a low wage recovery come the election. It confuses me that a low wage recovery still equals growth? Somehow I think that people on zero hour contracts and who are scraping a living will take little heart from the comparisons that politicians make at macro level about growth comparisons. When you cannot afford to heat your home or pay your bills and you are still working long hours you cannot rely on false statements about the economy growing when what you experience is far from prosperity.  

DA: Well, what we have seen in our economy this year is strong economic growth but we haven't seen tax receipts - particularly income tax receipts - grow as strongly as was forecast. We are seeing a lot more people entering the labour market, a lot of young people entering the labour market, who inevitably start on lower wages… That means income tax receipts are weaker.
RP: But isn't it an indictment of your economic policy that this is such a low-wage recovery?
DA: Hold on a second, our policy has led Britain, which was one of countries hardest hit by the financial crisis, to have the strongest recovery in the European Union, the best recovery in the G7, the best job creation in Europe, more jobs created in the United Kingdom than in the whole of the rest of the European Union combined. So yes, of course we need to see wages improve over the years to come, it is very very important to make sure the benefits of this recovery are shared. But I'd much rather be in the position of the United Kingdom than in the position of the many other European countries right now.
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  1. When you cannot afford to heat your home or pay your bills and you are still working long hours you cannot rely on false statements about the economy growing when what you experience is far from prosperity. do you agree

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