Looking at Britain’s economy back in January, I concluded that growth was seriously unlikely this year, and that it was entirely possible for Britain’s economy to go the way of Japan and hit a plateau. (To my mind, this is not necessarily a bad thing)
However, in a survey of 78 British economists, to predict a double-dip recession. That was Andrew Simms of the new economics foundation, who is probably no longer alone in his analysis. Most economists were hoping for a modest rebound, the government for a more substantial one.
Others were willing to ask more difficult questions, and one of them is financial services company Tullett Prebon. They began to do a little research under the name ‘Project Armageddon’, a working title that they admit “certainly wasn’t intended for publication.” The purpose of the project was to investigate the possibility that both the government and the opposition are both right – that austerity measures were necessary, but that they would inevitably result in a period of flat growth.
Several months later, Dr Tim Morgan has released his findings, and you can download it as “We conclude that Britain’s debts are unsupportable without sustained economic growth,” it says, “and that the economy, as currently configured, is aligned against growth.”
If that’s true, then Britain has just entered a postgrowth state. Welcome.