Here is a table showing projected growth in real GDP per capita [*] for 2007-08, according to IMF data released this month:
In other words, credible independent people who understand economic forecasting (note: not people who couldn’t tell GDP from a CDR but who think the PM is dour and boring and that therefore everything is going to the dogs) believe that the UK economy is unlikely to see recession, and is highly likely to outperform all of the G7 economies except for Japan over the next three years. Most other economic forecasters hold similar views, with a strong consensus that 2008 real UK economic growth will be 1-1.5%.
So why the hell is there such an insanely overhyped climate of doom going on, with people who shouldn’t really know better everywhere pontificating about how the government has ruined everything and left us all in a terrible position? Is it just that everyone who bothers going on about this kind of thing is a miserable get, whereas the people who think everything will probably be fine would sooner talk about Eurovision and football?
It’s partly due to misleading reporting, of course. Hands up who read this morning’s paper and came away with the take-out that UK retail sales fell when comparing March 2008 to March 2007? Wrong: they rose by 1.1%. The fall was in ‘like-for-like’ sales – i.e. new shops are opening faster than people are increasing their spending. That’s not great news if you’re a retailer, for sure – but it also for sure doesn’t mean that sales are falling…
[*] i.e. stripping out the effects of inflation, so you can’t whine about price rises, and done consistently on an international basis, so you can’t whine about CPI vs RPI. Oh, and please don’t slate the methodology the IMF uses to calculate GDP deflators, at least unless you have at least a master’s degree in a numerate discipline with some connection to economics.