Britain has suffered a double dip recession according to the latest GDP data for the first quarter of 2012. The economy contracted in this quarter 0.2% after having contracted 0.3 % in the fourth quarter of 2011. This is no surprise considering the draconian cuts in government expenditure that Chancellor George Osborne introduced in his budget and that was passed in Parliament with the support of the governing coalition of Conservatives and Liberal-Democrats. At the time these cuts were introduced a number of economists including myself pointed out that these austerity cuts were the wrong medicine for an economy struggling to recover from the crash and the deep recession that followed. And we were right to do so as the current data show. The chart below shows changes in the GDP, employment and weekly hours worked from Q1 2008 to Q1 2012 courtesy of the British Office of National Statistics.
Despite this clear evidence that the solution to deficits is to promote economic growth through stimulative spending which helps restore confidence to the private sector the Chancellor continues to argue nonsense about how to solve the ”debt crisis” through austerity.
I am Professor of political economy at Concordia university in Montréal, Québec, Canada. I received my B.A.Hons (econ.&poli sci) from the University of Manitoba. I also completed my M.A. degree in economics there. Went on to spend two years at the London School of Economics as a Ph.D. student in economics and then completed my Ph.D. in political economy at the University of Toronto. Was named a John W.Dafoe fellow, a CMHC fellow and a Canada Council fellow. I also was named a Woodrow Wilson fellow in 1968 after completing my first class honours undergraduate degree. Worked as an economist in the area of education, labour economics and as the senior economist with the Manitoba Housing and Renewal Corporation for the Government of Manitoba from 1972 to 1978. I also have worked as an economic consultant for MDT socio-economic consultants and have been consulted on urban planning, health policy, linguistic duality and public sector finance questions by the governments of Manitoba, Saskatchewan,the cities of Regina and Saskatoon, Ontario and the Federal government of Canada. I have also been consulted by senior leaders of the British Labour party, MPs from the Progressive Conservative party, the Liberal party and the New Democrats on economic policy questions. Members of the Government of France under the Presidency of Francois Mitterand discussed my work on public sector deficits. I have also run for elected office at the municipal level. I first began to write about quantitative easing as a useful policy option during the early 1980s.