Economy at 60-year low, says Darling. And it will get worse

BettiePage

In an exclusive interview, chancellor says Labour failing to communicate with voters

Britain is facing "arguably the worst" economic downturn in 60 years which will be "more profound and long-lasting" than people had expected, Alistair Darling, the chancellor, has told the Guardian today.

In the government's gravest assessment of the economy, which follows a warning from a Bank of England policymaker that 2 million people could be unemployed by Christmas, Darling admits he had no idea how serious the credit crunch would become.

Darling's blunt remarks lay bare the unease in the highest ranks of the cabinet that the downturn is making it all but impossible for Gordon Brown to recover momentum after a series of setbacks.

The chancellor, who says that Labour faces its toughest challenge in a generation, admits that Brown and the cabinet are partly to blame for Labour's woes because they have "patently" failed to explain the party's central mission to the country, leaving voters "!!!!ed off".

In a candid interview Darling warns that the economic times faced by Britain and the rest of the world "are arguably the worst they've been in 60 years".

To deepen the sense of gloom, he adds: "And I think it's going to be more profound and long-lasting than people thought."

The economic backdrop presents Labour with its toughest challenge since the 1980s. "We've got our work cut out. This coming 12 months will be the most difficult 12 months the Labour party has had in a generation, quite frankly," he says. But Labour has been lacklustre. "We've got to rediscover that zeal which won three elections, and that is a huge problem for us at the moment. People are !!!!ed off with us.

"We really have to make our minds up; are we ready to try and persuade this country to support us for another term? Because the next 12 months are critical. It's still there to play for."

Darling has some words of comfort for Brown when he predicts there will be no leadership challenge against the prime minister. He also reveals that Brown has no plans to carry out an imminent cabinet reshuffle as he delivers a defiant put down to critics who have said that he could be replaced as chancellor.

"You can't be chopping and changing people that often," he says. "I mean, undoubtedly at some stage before the end of the parliament he will want to do a reshuffle, but I'm not expecting one imminently. I do not think there will be a reshuffle."

Darling does not name names, but says some people want his job and have been trying to undermine him. Many in the Treasury believe that Ed Balls, the schools secretary, has been less than supportive. "There's lots of people who'd like to do my job. And no doubt," he adds, half under his breath, "actively trying to do it."

The chancellor's remarks about the economy - in an interview conducted over two days at his family croft on the Isle of Lewis - highlight the nerves at the top of the government after the loss of Labour's 25th safest seat in Britain in the Glasgow East byelection in July. The Tories are comfortably ahead in polls as leaders return on Monday after the holiday.

Darling, who speaks about how the prime minister is one of his oldest friends in politics, admits Brown has so far struggled to connect with voters. Asked whether Brown can communicate Labour's mission, he says: "Yes, I do think he can. I do think he will."

Asked why Brown has not done so, Darling falters as he says: "Er, well. Well, it's always difficult, you know ... But Gordon, in September, up to party conference, has got the opportunity to do that. And he will do that. It's absolutely imperative."

The interview was designed to show the chancellor in a more personal light after a year in which he shouldered much of the criticism over the collapse of Northern Rock and the loss of discs containing details of half the population.

He said nothing in his interview of his tensions with No 10 after he was reportedly rebuffed by Brown when he pointed out the dangers of abolishing the 10p tax rate soon after he took over as chancellor.

http://www.guardian.co.uk/politics/2008/aug/30/economy.alistairdarling

ultra10

At last a bit of honesty !!! bt many of us on these boards have been saying this for many many months !!.... This will not be a recession more a depression !!! .... The great property crash of 2008 is well under way !!

BettiePage

Scarey isn't it, if he's willing to admit to this, how bad is it REALLY?

ad44downey

New Labour is getting really desperate now. Sod them. I'm sick of them wasting my tax propping up inflated house prices. They never learn. More stupid 'keep house prices high schemes' are to be announced next week apparently..

Trollfever

Wow................

dopester

Britain is facing "arguably the worst" economic downturn in 60 years which will be "more profound and long-lasting" than people had expected, Alistair Darling, the chancellor, has told the Guardian today.

In the government's gravest assessment of the economy, which follows a warning from a Bank of England policymaker that 2 million people could be unemployed by Christmas, Darling admits he had no idea how serious the credit crunch would become.

The sheeple will have to wake up to the fact this is not a blip. I presume something at the forefront of the Government's minds is how they are going to keep the public spending at these levels with ever more weaker revenues. Scary. And none of it can be fixed with wishful thinking. It is a natural process of boom and bust.

Still surprised he swore. I don't think it is fitting for an MP / Chancellor. No amount of zeal will turn the economy around.

BMWobbleU

The Buffoon, AKA GB will regret not going to the country when he had the chance...not that the other clown DC could (or would) do any better.

ManAtHome

ultra10 wrote: »

At last a bit of honesty !!!

ROFL - politician and honesty in the same sentence, joining the millibandwagon more like.

Only a couple of months ago this waste of space was telling us everything was ok, just a blip, get out there and spend all your cash on housey/shiny stuff - miracle e-Con is well placed to ride out the storms. Now it's a touch of the whoops, didn't mean it, only works if you're ripping off the voters for the equivalent of £4-500k pa plus platinum-plated pension etc.

Forecast for the future? These tw@s will spend ever increasing amounts of YOUR cash to keep THEIR snouts in the trough. I will applaud honesty if any one of them ever has the cojones to resign on principle, but not expecting any wear and tear hand-wise "real soon now"...

Generali

BettiePage wrote: »

Scarey isn't it, if he's willing to admit to this, how bad is it REALLY?

Is Alistair Darling really saying that the economy is in a worse state than in the time of Cripps and austerity?

1948 was a time of rationning of food, clothing and coal. Competitors had to take their own towels to the Olympics in London as the organisers couldn't afford to provide them! Unemployment more than quadrupled in a couple of years.

If times ahead are going to be worse than 1948 then we'll have bread riots.

I have my doubts quite frankly. I think he's trying to soften people up by saying things are going to be absolutely terrible and then hoping that they'll be grateful that things are only very bad.

dopester wrote: »

I presume something at the forefront of the Government's minds is how they are going to keep the public spending at these levels with ever more weaker revenues.

That's where things are going to get really rough in this country. I remember reading the local paper in Lewisham a few years back and some woman had written a letter saying how appalling it was that there were some nettles where her son kicked a ball about and how the council should do something about it because she was a single mum (I have no idea what her marital status had to do with her ability to deal with stinging nettles).

I remember thinking 'You lazy thing' (I didn't use the word thing) 'cut the [EMAIL="d@mn"]d@mn[/EMAIL] things down yourself.' People are going to have to cut their own stinging nettles down for the next year or two IMO and about time too.

tomstickland

Oops, I just started another thread on this.

I'd assumed that the miracle economy had waved goodbye to boom and bust. Sadly, it turns out that it was just a much longer boom that will lead to a bigger bust.

Mac_Sami

Economy at a 60 year low? That's no problem, because guess what - around 60 years ago, it was a Labour government in power, and the Conservatives stepped in at around 1951, while Labour wasted 13 years.

Fingers crossed it happens again

(Apologies, it is an extremely anedoctal comment - 60 years ago was a lot different to today - but you have to start asking how on earth we've ended up in this mess, which surely has to partly be due to Labour policy over the last decade. Agreed, no other party may or will do a better job, but come on, I'm sick of excuses, sick of bull, sick of people sticking their hands up and admitting times are tough. Just do something about it!)