Economic Performance and the Election
One of the quiet success stories of this election has been the way some academics have contributed their expertise to the debates. My favourite has been the series of analyses of key policy battlegrounds published by the Centre for Economic Performance at the London School of Economics. CEP has now published the full set and if the subjects where I know something are anything to go by, they are fair, authoritative and expert.
On public finances, they point out that, in the ten years before the recession the government increased both taxes and spending. “The higher spending on police, education and hospitals has reduced crime and improved schools and healthcare – but public sector productivity has fallen.” The CEP is critical of all the parties’ proposals for cutting the deficit, arguing that they are “not specific enough to be credible” and rely on efficiency savings that are “elusive and hard to achieve.”
Inequality has been rising for three decades; this has happened around the world, but especially in the USA and the UK. Inequality is worse now than it was in 1997, but the policies of the last dozen years have ”significantly redistributed income to the less well off. Inequality would have been much higher otherwise.”
Employment: despite the great recession (which has cut GDP by more than any other post-war recession) the increase in unemployment has been “far less than expected”. Young people have been hardest hit, but this always happens in recessions and ”there is no evidence that they are doing relatively worse this time round than in previous recessions.” The New Deal and other employment programmes have “helped to constrain unemployment”, but the weakening youth labour market began before the recession it isn’t possible yet to be sure why.
Migration did rise between 1995 and 2008, but ”while there may be costs to particular groups, there is little evidence of an overall negative impact on jobs or wages.”
The series also looks at health, education, crime and bankers’ bonuses, amongst other issues. This is how academic expertise should be applied to public policy debates. It is ACE – expert, calm and authoritative – and should be used as a model for everyone with an interest in any of the policy areas.