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Blanchflower: Osborne's cuts will make 5m jobless
23 Sep 2009Former Bank of England member David "Danny" Blanchflower has launched a scathing attack on shadow chancellor George Osborne and said unemployment could hit five million under Tory plans to slash public spending.
Blanchflower, an employment expert who left the Bank's monetary policy committee at the end of May, said: "Unemployment is going to continue to rise this year and may keep on rising. If spending cuts are made too early and the monetary and fiscal stimuli are withdrawn, unemployment could easily reach four million.
"If large numbers of public sector workers, perhaps as many as a million, are made redundant and there are substantial cuts in public spending in 2010, as proposed by some in the Conservative Party, five million unemployed or more is not inconceivable. They could be our lost generation."
The comments came in an article for tomorrow's New Statesman magazine, which also included a personal attack on Osborne.
"It is not hard to work out that, with unemployment rising fast, it isn't the right time to cut public sector jobs, wages or public spending for that matter," wrote Blanchflower.
"Mr Osborne, I really don't know which economists are advising you on this brilliant strategy to increase unemployment, but feel free to give me a call."
The attack on Osborne came two weeks after Blanchflower branded Governor Mervyn King "the old iron fist of the Bank of England" whose "hawkish views on rates dominated the MPC" early in the financial crisis.
Reader views (7)
Blanchflower has ZERO credibility. Why is he being given free rein to spout his nonsense?
Throughout the boom and the mushrooming of unsustainable lending, he was continuously suggesting we took the boom up a notch. Reckless, stupid and self-serving. Now for some reason he's managed to portray himself as some sort of sage!?
Had he got his way we would be firmly in the liquidity trap, and worse off than we are now - which is a tall order.
- Roy, London, UK, 26/10/2009 15:26
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Gordon Brown HAS already got over 5 million unemployed when you add in the self employed not claiming JSA,the wives or husbands not entitled to benefits ,those on sick benefit and the neets on the streets.
Well done Gordon you got there before Osborne.Whatever Blanchflower says the majority want Brown and Mandelson to go, and quick.
- Keith Priceless, Luton, 24/09/2009 15:07
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If it's from the bloated public sector and it's batallions of "Non-Jobs"worths then it certainly is a price worth paying. Bring it on!
- Steve, Brentford, 24/09/2009 08:58
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It's already at 5-million - it's just that the books are cooked. Add up all those on silly courses (not in the figures), those moved onto invalid benefits etc.
- Never Eat Tuna Again, London, 24/09/2009 07:24
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Spot on 5 million at least, I'm afraid the current conservative front bench are clueless, I have thought this for some time. Most world governments are following the same fiscal path that our british government proposed. Like it or not the UK will get better but as most economists know the conservatives will make it longer and deeper than it should be. We need to get our heads round money flow velocity and how modern economies function. Sadly Camerwrong and Ozzy are very shakey on economics'....
- John Smith, b,mouth, 24/09/2009 01:24
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True the Conservatives are proposing to cut public expenditure and no doubt services will be affected to some extent, but so are Labour and the Lib Dems. Interesting that Mr Blanchflower has chosen to atack only one of the three proposing parties. Nice to know Mr Blanchflower's true colours. Is it just coincidence that this attack comes immediately after Lord Mandelson revealed his intentions to mount a spin campaign aimed at Osborne personally or is Mr Blanchflower acting independently for the left-leaning New Statesman?
- James Elliott, Eastborne UK, 23/09/2009 19:33
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Blanchflower was a Gordon Brown placeman on the MPC and has always been pro labour.He lives in the US and was a much criticized appointment.
- C.F.Frank, london, 23/09/2009 17:28
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