Friday 28 October 2016 6:54am
Christian May
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| Brexit doom and gloom has been discredited by the latest GDP figures (Source: Getty) |
A couple of years ago I interviewed Saatchi & Saatchi’s global CEO, Robert Senior. As we discussed possible future advertising trends he said “my problem with futurologists is that they’re never held to account”. He meant that predictions of what life will be like in 100 years are very hard to hold up in front of the wise heads who made them.
When it comes to more short-term forecasting, we’re able to turn around to people and ask them why they got it so wrong. This is now exactly what we should be doing to the legions of experts who predicted immediate recession and job losses should Britain vote to leave the EU.
Ahead of the referendum, David Cameron said “the shock to the economy...would tip the country into recession”. George Osborne said a vote to leave would cause “a year-long recession with at least 500,000 jobs lost”. The OECD said the short-term impact would be a hit to GDP of minus 1.25 per cent and the IMF said that Q3 2016 would see GDP recoil by a cool 0.3 per cent. Yesterday we got the true figures for that quarter, revealing 0.5 per cent growth.
Much of the doom and gloom came from a now utterly discredited Treasury report which itself predicted Q3 growth of between minus 0.1 and minus one per cent. John Hulsman, one of our regular columnists, says the reason the experts so routinely get the big calls wrong is because they all inhabit the same world, attend the same events and soak up the same thoughts. This may be true when it comes to political predictions but economic forecasting is supposed to be much more robust. As The Spectator’s Fraser Nelson suggests, now is the time for the profession to conduct an inquiry into itself, in much the same way as the polling industry did after getting the last General Election results so wrong.
As one senior MP puts it to me, the latest GDP figures “explode the garbage of Project Fear and the damage it has done to the reputations of otherwise serious forecasters”.
Any takers for some Brexit bedroom gear?
You probably made it through the referendum without amassing a stash of Vote Leave merchandise, but apparently the caps, pens, bags and badges were all very popular. However, I’m told that the campaign has a huge stack of one particular item left over: branded Vote Leave condoms. There’s a joke in here somewhere about the decision to withdraw, but I’m not going to search for it. If you want some patriotic prophylactics you know where to find them.
This is not just a glass of wine...
Our wine columnist, Neil Bennett, has been busy. His contributions to our Bespoke magazine have picked up quite a following and his feature for the next edition is an absolute treat – combining, as Neil likes to do, business with fine wine. He sits down with former M&S boss Stuart Rose to grill him on his favourite wines. I won’t give the game away but needless to say Rose’s tastes have come a long way since he introduced the M&S Dry White to the shelves back in the late 70s.
Trading ideas: It’s time for the experts
The chatter in Whitehall is that the new Department for International Trade doesn’t exactly host the cream of the civil service elite. All the more important, therefore, that they look to outside experts for guidance. One organisation making a real name for itself in trade policy is the Legatum Institute, whose new Trade Commission, headed by an actual former trade negotiator, Shanker Singham, is generating plenty of food for thought for Dr Fox & Co.
In the beginning there was Maggie
Or was there? It’s often assumed that the Iron Lady was the mastermind of the City’s Big Bang, rubbing her hands with glee at all that unrestrained capitalism. In truth, she was barely involved in the policy decisions around it and may not have even been that comfortable with its consequences. The historian Eliza Filby (to whom I am engaged) reminds me that “she went in to politics to create the world of her father – a methodist preacher –and ended up creating the world of her son”.
http://www.cityam.com/252459/editors-notes-brexit-has-damaged-economists-not-economy
