A ‘rebound’ to the Old Normal is not good enough

At the end of April, Barclays boss Jes Staley was forecasting that 2021 would see the strongest boom in Britain since the aftermath of the Second World War. The emerging consensus among economists is only a little less ebullient in anticipating the fastest pace of growth since 1989. The Bank of England’s chief economist, Andy Haldane, captured the upbeat mood: ‘As I’ve been saying for months – drawing on the economics of coiled springs, and crouching tigers, and “Chicken Lickens” – I do think more likely than not we are [set] for a rapid-fire recovery. That is coming, and I think that is coming soon.’

The upgraded forecasts for Britain’s economic growth this year and next from the likes of the IMF and the EY ITEM Club are quite feasible. However, it is short-sighted to think a rapid bounce-back over the next year or so will mean a robust long-term recovery. Moreover, talk of a ‘great rebound’ could also reinforce the tendency of successive governments to abandon their economic responsibilities to help the private sector create new growth sectors with enough decent well-paying jobs for people.

Read the full article here.

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