Real earnings and Labour fortunes: graph lines crossed
There was a time that George Osborne thought he might be carried shoulder high by a grateful nation at the 2015 election as it entered the sunlit uplands of a buoyant economy. Ask him in 2010 whether he’d be rushing to the cameras to proclaim the joy of earnings creeping 0.1 per cent ahead of inflation and he might have scoffed.
But that’s what he did today (and the Lib Dems’ Vince Cable too, trying to claim some credit for economic management they feel they co-authored).
Labour says much of the population throws its boots at the telly when it hears government ministers proclaiming economic recovery. Many aren’t feeling it. George Osborne hopes he can convince them today is a turning point.
He had encouragement for that outlook from the Bank of England which gave encouraging forecasts for nominal earnings growth of 3.25 per cent in 2015 … but (thanks to the Resolution Foundation for pointing this out) the Bank of England’s forecasts on real earnings (see below) have been consistently undershot in the past.
Tomorrow, the Labour leader Ed Miliband will address the boot-throwing classes and tell them he feels their pain in the hope he can create a turning point in his political fortunes.
He’s trying to get the voters to see him as someone with a big offer, a transformative agenda for the country, that will right the wrongs of the gross inequality that he argues accounts for them not feeling the benefits of economic growth.
David Axelrod, the US election strategist, warned Labour back in the summer that the party needed to stop offering “palliatives” and go big. Ed Miliband will be hoping tomorrow’s speech can re-start his efforts to get that message across.
But he does it in the shadow of another rotten opinion poll. Just as the earnings/inflation lines crossed in the right direction for the government, the Lab/Con graph lines of support crossed in the wrong direction for Labour (in an Ipsos Mori poll for the Evening Standard) putting Labour on 29 per cent, three points behind the Tories.
The leadership doesn’t normally comment on polls but decided this time it was worth breaking with precedent to pin the blame for the latest support slump squarely on those inside Labour who’ve been knocking the leader.
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