Whitehall was rocked today as violence broke out among economic forecasters.  Experts predict that this sort of thing can only get worse as the recession bites. It is true that City analysts haven’t yet got to the stage of pitching fire extinguishers off the roof of Conservative Central Office, but the time will come. All leave at the Economist has been cancelled.

The temperature was raised by the appearance at the parliamentary despatch box of Oik Osborne, a man who, to be fair, can start a riot by eating a bowl of cornflakes, but who on this occasion stoked the flames by claiming that the prospects for Britain’s economic recovery are very good. This was enough to drive all good sane people, as well as the aforementioned economists, to convulsions.

Mr Osborne knew he had good news to impart because he had been told it so by Mr Robert Chote. Mr Chote used to work for the Institute of Fiscal Studies, an organisation with more believers than the Church of England. Today, however, he is the head of something called the Office of Budget Responsibility a body that, to pursue the religious analogy, enjoys approximately the same credibility as the Moonies. This is unfortunate for Mr Osborne, who set the OBR up to be incorruptibly distant from the midden of politics, but finds it with a reputation for disingenuity capable of dragging down even Mr Robert Chote. Maddeningly, there is no prospect of this changing until the OBR starts saying things that Mr Osborne does not want to hear.

Dig a little way into the OBR’s analysis and its caution is evident.  But, its headline message yesterday was very much in line with the Chancellor’s languid confidence that his tough economic medicine is doing the trick. No longer the economic basket-case about to be pounced upon by humourless accountants from the IMF, Britain is steadily pulling away from what Mr Osborne and David Cameron were pleased to call the danger zone.  Economic growth, according to the OBR, and as gleefully re-told by the Oik, will surge ahead to 1.8% this year, transforming the country into a land of organic semi-skimmed milk and locally-cultivated honey, compared to the soiled, acidic wasteland associated with the previously expected growth-rate of 1.2%. And in the next two years, wait for it, growth is expected to tick over at 2.1% and 2.8% respectively, meaning that it will scarcely be possible to walk down the street by the time of the Olympics without someone rushing up and offering us two or three well-paid jobs.  It is true that the 2011 and 2012 forecasts for growth are somewhat lower than what had been set down before, but in politics it is important not to allow too much sobriety to butt in upon the magic.

All of these numbers pose something of a dilemma for Alan Johnson, Mr Osborne’s proletarian oppo. He can hardly join in the cheering at the glorious liberation, but neither can he accuse the Chancellor of talking out of his backside. Not only would such language be deemed unparliamentary and thus pounced upon by the demonic mannekin Bercow, but too much renting of garments commits the even grosser sin of “talking Britain down”.  So Mr Johnson took the only option left to him which was to say in a roundabout way that he didn’t really know.  Now of course he couldn’t exactly put it like that – there are already too many people, including Mr Johnson, signed up to the notion that the shadow chancellor doesn’t understand economics – so instead he accused the chancellor of taking an enormous risk. This, ironically, is the safest thing he can say since it must be true. Any serious economic or political decision is a risk.  If the risk goes sour, Mr Johnson is vindicated; if it pays off, everyone will be too busy getting rich and drunk off the proceeds that no one will remember.

Mr Osborne “is in the casino, but hasn’t yet spun the wheel”, said the shadow chancellor, a colourful metaphor concealing the truth that, so far as Mr Johnson or any of the rest of us know, the Oik might yet turn out to have placed his chips wisely. The advantage for Mr Johnson, an ageing politician, of this formulation is that by the time anyone knows where the ball is going to land, it will be too late to matter to his career.

Outside this cosy Westminster game, however, things are a lot more angry as forecasters rushed to dispute the numbers. Some of them went so far as to describe Osborne’s predictions as “overly optimistic”.  The Chancellor is not the only person in this scenario who knows about cutting.

 

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