I know it sounds a bit masochistic, but I like budget day. Not only is it the one day in the year when the economics editor gets the respect he deserves, but it also gives us the opportunity to explore the mysteries of planet Gordon.

On planet Gordon, life is sweet. Britain is an economic powerhouse, leaving the laggards of the eurozone for dead; living standards are second only to those of the United States; highly-skilled workers are beavering away in their gleaming new laboratories to invent the products that will allow the economy to beat off the challenge of the Indians and the Chinese.

Give the chancellor his due. His record since 1997 is pretty good. Inflation and interest rates have been low; growth has been steady; unemployment has fallen. But the idea that under his stewardship Britain has transformed into the epitome of social democracy is plain daft. No doubt, the blokes who have been loaning Labour millions in return for a gong are sitting pretty, but for most of the "hard-working families" mentioned repeatedly in the budget, life is not so sweet. Pay is not rising very fast, taxes have gone up and higher energy bills have eaten into disposable incomes. It's not difficult to see why, in the real world, so many shops are offering mid-season sales: consumers are hard-up and fed-up.

That's why I'm sceptical about Gordon's bullish forecasts for the economy. The economy is made up of four components, of which consumer spending is by far the biggest. If it is growing only modestly, it puts extra pressure on the other components of demand: government spending, exports and investment.

We know from yesterday's speech that government spending is going to be squeezed, because Gordon is a bit strapped for cash after the big investment programmes of the past six years. Any spare money will go into education. That leaves the possibility that we are about to see a burst of investment to build the gleaming new factories that will churn out high-tech goods for an export drive. No, I don't think so either.



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