Newsnight's Economics Editor Stephanie Flanders last night posed an interesting retrospective on Geoffrey Howe's 1981 Budget. Now, I'm no economist, but I've done a few calculations of my own and worked out that if Stephanie was twelve in March 1981, she's now thirty-six - so I did learn something from her report.
Anyhow, the point of her exercise was to assess just how riddled with bad decisions Howe's 1981 Budget was. As Anthony and many other Filter contributors will tell you - and as they no doubt knew long before last night unlike me - 364 economists wrote to The Times in protest at Howe and Thatcher's stringent monetary-led policy. So last night Newsnight gathered some of those economists (and some treasury-based members of Thatcher's 1981 government) around a plate of bourbons and asked them to muse on Howe's decision, twenty-five years on. This is complicated by the very issue of how you determine a recessive economy - by looking at unemployment figures? The dole queues of 1981 should surely have been writing on the wall.
One interesting point that the now 'Lord' Howe made was prompted by Flanders asking him just what his reaction to that letter from 364 respected economists was. He replied, 'Since then I've thought of economists as people who know 364 ways of making love, but don't know any women!' Well if I were to stretch the metaphor to my knowledge of economics, I'd have to say that I know plenty of women, but no ways of making love, so I'll consign this piece to the 'comment' facility!
Bravo!
Posted by: AJE | March 14, 2006 at 12:36 PM