Social partnership tops poll as biggest threat to recovery
It's not what the Government is doing that's the problem, but rather how it is doing it, writes Marc Coleman
Published 19/12/2010 | 05:00
It has to be said respectfully. But it has to be said. The sentence "Morgan Kelly was wrong" isn't a popular one. But then neither was Morgan himself when, back in 2007, he correctly predicted the failure of our banks. But getting it right once doesn't mean getting it right every time.
In January 2009, Morgan predicted that unemployment would hit 20 per cent and that GDP would fall by one-fifth. As predicted here, the latest official figures show unemployment stabilising at 13.5 per cent as of September. Subsequent Live Register data suggests that, as of November, that rate is falling. National accounts data published on Thursday show that, far from falling by 20 per cent, the economy is back to levels seen in early 2005, or about 10 per cent below the 2007 peak. What's more, as of September, it was growing in quarter-on-quarter terms.
Morgan can fairly point out where my forecasts have gone wrong. In 2008 I seriously underestimated the stupidity of the Government in assuming it would abolish stamp duty. It didn't, and the absence of a real second-hand market or any multiple bidding environment has -- together with the banking crisis and crisis of confidence -- kept house prices below the 2005 levels to which the rest of the economy is returning.