I have been struggling all morning to find reasons to be cheerful. I wanted to write one of those jolly, holly-sprigged columns about why it’s a wonderful world, and why Britain is a wonderful country.
My friends, it has not been easy.
As this dank, dark December draws to a close, the economic data for the UK seems to be uniformly ghastly. The Bank of England has just downgraded its forecasts for our country: from an anaemic 0.3 per cent growth this autumn, to zero – I repeat, zero.
Inflation is on the way up again. Interest rates are painfully high, and likely to remain so. Business confidence continues to plummet. Unemployment is climbing, wealth creators are fleeing the country, and investments are being cancelled or mothballed.
As the economy shrank in October, we are now officially teetering on the brink of a recession – and the extraordinary feature of this catastrophe is that it has been entirely generated in Downing Street. Together the hapless Starmer and Reeves are doing for the UK’s economic prospects what the Luftwaffe did to London’s skyline or Herod the Great did for childcare in Judaea.
No, wait – it’s more sinister than that. In this case the very people who are meant to be promoting growth are in fact destroying it. They are doing for the UK economy what Harold Shipman did for gerontology in Manchester.
With their hara-kiri fiscal policies they are setting new records for sheer blithering incompetence, and to judge by Starmer’s insouciant performance before the Liaison Committee yesterday, they genuinely have no idea how badly they are stuffing it up.
Starmer needs to take off his sleaze-smeared spectacles and look around. Thanks to him and Reeves, the whole country is getting poorer, and since it means that the life chances of millions of people are actually diminishing, I have not found it easy, as I say, to adopt my usual tone of sunlit optimism.
Prime Minister Sir Keir Starmer and Chancellor Rachel Reeves are the very people who are meant to be promoting growth, but they are in fact destroying it, writes Boris Johnson
These Labour goons have a vast majority. They can expect to be in power for years to come. There is no way of winkling them out – not democratically. Every day seems to bring some new disaster or ugly revelation, and every day they steer the UK further and further off the right course.
So where is the upside, this festive season? Where is the candle in the darkness? My friends, I want you to know that I rose early and, with a liverish eye, I scanned the scene in search of good news – and then, of course, I saw it.
I have found my Yuletide reason to be cheerful, flickering in the dark like a Christmas pudding. This Labour government is proving to be a disaster, but out of that shambles will be born one unambiguously positive result.
There are tens of millions of young people who are learning, for the first time, what socialism really means.
Most young people in this country no longer have any personal memory of the economic horrors of the 1970s, which Starmer is trying so earnestly to recreate. Many young people don’t even remember Tony Blair and Gordon Brown, let alone the old Labour addiction to tax and spend.
Wage-price spirals, stagflation, excessive borrowing, mass unemployment – all of these might have been vaguely covered in school textbooks. But the younger generation do not have these things seared on their memories – not in the way they are seared on mine or, I expect, yours.
So, when it came to the General Election of 2024, we Tories could warn them of the dangers – and we did. We raved about excessive tax and spend and the risks involved. But for tens of millions, it was all a bit abstract, a bit theoretical. Well, not any more.
Thanks to Starmer and Reeves the entire British population is being taught, in agonising detail, why Labour governments always end in failure.
Let us review briefly Starmer’s six-month binge of destruction.
When Labour came in last July, the Tories had painfully brought inflation back under control again, and at that stage we had the fastest growing economy in the G7. With the right mixture of spending control and pro-growth, pro-business regulatory and fiscal policies there was every reason to hope that the Government’s fiscal position would steadily improve.
Well, Labour took a sledge-hammer to the whole thing. They junked our plans to cut 66,000 jobs from government and reduce the size of the state.
They caved in to the unions and agreed inflationary pay deals with the doctors and the train drivers. At the same time, they clobbered business and announced plans for a panoply of new non-wage costs – laws forbidding you to contact your staff out of hours; laws allowing them to skive off, aka ‘work from home’.
Worst of all, they spent the first few months in office allowing politics to be dominated by the spectre of a tax-raising budget, and then hammered a cowering business sector with a £25 billion increase in National Insurance. This was not only confidence-destroying, it was inflationary.
Starmer and Reeves are doing for the UK economy what serial killer Harold Shipman, pictured, did for gerontology in Manchester
If you increase a company’s wage bill, they will have to find the money from somewhere – usually higher prices. And if inflation goes up, then the Bank of England has to keep interest rates up, and that in turn hits business confidence and investment, which hits jobs and growth, which hits tax yields.
So here we are, my children. Gather round. This is the Doom Loop of Socialism. By pushing up taxes they have ended up reducing economic activity – and thereby reducing the tax revenues of the Government. That means they have less to spend on public services such as health and welfare – at the very moment when more people are going on the dole, and when those costs are starting to rise.
So, they then have no choice but to raise more tax – and cause more pain – or try to borrow more, which in turn pushes up interest rates and clobbers business again.
It is always the same with Labour. In the end, as Margaret Thatcher said, they always run out of other people’s money.
Starmer has managed almost immediately to enter the Doom Loop of Socialism, and the good news is that he and Reeves are providing, for a younger generation, a masterclass exposition of why tax and spend is a disaster.
For the Conservatives under Kemi Badenoch, it is, of course, a massive opportunity. For Kemi and Andrew Griffith, the excellent shadow business secretary, it is the moment to explain to the public that governments do not create jobs and growth – only business can do that.
It is the moment to make the case for lower taxes, and smaller government, and cutting back some of the vast excrescences of the state-funded arm’s length agencies. It is the moment to educate young people in Tory ideas of aspiration, and opportunity and home ownership.
Yes, it will be frustrating and miserable to watch our economy continue to flounder under Labour. But the longer we have to wait, and the more frustrated we become, the greater the chance that the next election will deliver a Thatcher moment – the decisive change that the country needs.
And with that bracing thought I wish you all a very Merry Christmas!
