Move over cyclist-squashing bendy buses, culturally-derivative Chinese, inverted pyramids of piffle and tribal warriors with watermelon smiles. For Boris Johnson has managed, to my mind at least, to top practically every previous statement for sheer jaw-dropping bonkersness. As reported by today’s Evening Standard in relation to the Mayor’s visit to a new shopping emporium somewhere out Shepherd’s Bush way, Mr Johnson has deigned to provide us with the following words of economic wisdom:
“If anything can persuade the British public not to worry too much but to spend, it will be the Westfield shopping centre.”
You have to admit, it is more coherent than anything that the Tory’s real economic spokespeople have yet to utter. Time after time, the economic textbooks have told us that what dries up consumer spending is not a fear of unemployment or home repossession; not the drying up of consumer credit or the rising cost of essential goods; nor is it concerns over the value of pensions or the need to work longer hours to make ends meet. No, the key blockage in the pipe was, until this week, the lack of a bloody great shopping centre in a well-off bit of West London. If only Boris was Chancellor rather than a lowly Mayor – he’d have had the economic foresight to bring forward Westfield’s opening by a couple of months and Lehman Brothers would never have collapsed.
Joking aside, the Evening Standard article demonstrates what strikes me as a remarkably irresponsible tone being struck by the Mayor. On Tuesday in the Telegraph he was advocating the good old-fashioned (and totally disproven) Tory mantra of trickledown. The rich should spend their money and that’ll get the economy moving again. And today, opening the Westfield centre, he is reported as opining that
they [Westfield visitors] should not let money “silt up” in their bank accounts but spend it to beat the gloom
shoppers needed to “invest in Christmas presents” as an antidote to the gloom.
Fine, until you remember that it was at least in part an orgy of consumer over-spending both of individuals’ own limited capital (because the good times would never end) and the huge debts racked up through over-easily obtained credit card and remorgatged loans. Or to quote Boris’ colleague, the man who is somehow still the real Shadow Chancellor, speaking in April
David Cameron, myself, and many others warned that the growing level of consumer debt that went hand in hand with this inflation in assets was unstable. As I said two years ago, “an economy built on debt is living on borrowed time”.
Certainly, the complete drying up of consumer spending wouldn’t help anyone right now – but a rowing back towards individuals seeking to broadly live within their means would be a good start. Right now, it would make sense for politicians of all parties to be united in calling for us to prioritise the rebuilding of savings pots so that the next boom is not so heavily based on consumer debt. This could take the form of the government providing, say, a 20% top-up of money placed in long-term savings by the lowest paid workers, which would probably be a better ‘investment’ (to use Boris’ term) than an over-priced Westfield Christmas present. I know it is practically heresy right now to suggest that interest rates should be in anything other than free-fall, but there does need to be a balancing struck which doesn’t disincentivise saving and encourage the most ludicrous forms of unaffordable consumer debt.
And whilst we’re on the subject of Boris Johnson and Westfield, I made some predictions a month ago about the completion of which transport projects ordered and paid for by Ken Livingstone Mr Johnson would be taking credit for. I’m sorry to report that I missed one, as the london.gov.uk website is today leading with the news that Boris has ‘unveiled a major package of improvements for West London’ (one new Underground station, a new Overground station, one major station refurbishment and associated works) – without a single mention of when exactly these were put in the pipeline (clue here). The may have called Mr Livingstone a Trotskyite, but Mr Johnson is certainly turning out to be a Stalinist in his desire to whitewash the previous regime from history.
Oh, and another interesting point that emerges from this is another instance of the increasing gap between Boris’ chief cheer-leader Andrew Gilligan and the object of his affections. Last week, Gilligan described Westfield as
the retail equivalent of the neutron bomb
in its potential effect on small businesses in its neighbourhood. Now that his favourite Mayor has described the same place as
an investment in London’s future that will continue to exist long after the recession has gone away
presumably Mr Gilligan will be wanting to revise his earlier rash statement? We can’t have London’s happiest couple falling out in public like this.