The chancellor has urged people not to be 'anti-business', but his policies are hardly good for it
The chancellor of the exchequer has called on his fellow citizens not to be "anti-business". In doing so he is indulging in the time-honoured ploy of setting up a man of straw. I know of few people who are anti-business. Unfortunately, this small band includes George Osborne himself, whose deflationary policies have ensured, as the National Institute of Economic and Social Research recently pointed out, that the British economy is recovering more slowly from the 2007-2008 financial crisis than it did in the 1930s in the wake of the 1929-31 Great Depression.
This is not good for business, and many good companies are going under as a result of the chancellor's strategy. By contrast, in the US, where the economic stimulus of 2009 was not withdrawn prematurely, there is a genuine recovery, even if it is sluggish by previous standards.
No, what people do not like about "business" is bad business practices, which make the consumer's life difficult. Just as something went badly wrong with the financial sector and economic policy during the past decade – banks out of control; policymakers obsessed with inflation targets and ignoring the credit boom – so there was also an unfortunate development in the attitudes of many companies towards the consumer.
The prevailing strategy of such businesses these days is that the consumer should do the work. Amazingly, most people seem to put up with this. They may complain about having to speak to call centres in remote parts of the world, but will happily spend hours ordering goods and services online. If that is what people want, so be it; however, it is not for me.
I came across a classic deterioration in service standards on the Gatwick Express last weekend. The operators appeared to have dispensed with the onboard person who would check tickets and issue them if one had rushed onto the train. Last weekend there was confusion all round, especially for tourists.
This is a pity. The Gatwick Express used to be one of our better services. I recall the time that David Marsh, now co-chairman of the Official Monetary and Financial Institutions Forum, a monetary thinktank, invited Gerhard Schröder to speak in central London before Schröder became the German chancellor. The car provided for him took two and a half hours to get from Gatwick to W1, and your correspondent suggested that the Gatwick Express would be a better bet next time.
Schröder was in town again last week, and chose not to repeat the Gatwick experience, flying to my favourite London destination, namely City Airport. In 1998 he had been sceptical about the far-advanced plans for a single currency, but as chancellor he inherited membership of the eurozone and was loyally supportive.
However, addressing the first International Statesmen's dinner in Ironmongers' Hall - where there is no shortage of armour on display – he pulled no punches: "There is a risk that the national economies will be more or less strangled by strict austerity measures," he warned, adding for good measure that, although president François Mitterand of France had wanted to "enclose" Germany's economic strength, "and, hence, our political strength [by setting up the eurozone] "this was doomed to fail because Germany, as an export nation, profits enormously from the euro".
Just to ram home the point, Schröder added that the mistake made by his predecessor, Helmut Kohl, "was to assume that monetary union would force a political union".
The export contrast is marked: in the first half of last year Germany had a current balance of payments surplus of $88.6bn (£56bn), whereas France had a deficit of $33.5bn.
I sometimes wonder whether the eurozone crisis would have happened quite so soon after the currency's inception if it had not been for the wider financial crisis of 2007-08, which undermined confidence in the entire system, with manifest consequences for the eurozone.
Opinion about the chances of the eurozone pulling through seems to go up and down like a yo-yo, with many sighs of relief recently about the massive injection of liquidity – for up to three years – into the banking system by the European Central Bank, under the new presidency of the widely admired Mario Draghi.
There was a distinct echo here of the post-Lehman operation by central banks to avoid a meltdown, and Draghi told the World Economic Forum in Davos last month that his latest operation had "avoided a major, major credit crunch".
But that merely buys time. The "fiscal compact" on which members of the eurozone have agreed is a "good times" compact; it is no answer to the current depression. I was recently rather taken aback to hear one of Draghi's fellow Italian officials, who last year strongly criticised the Germans for their obsession with austerity at a time of economic weakness, deliver a paean of praise for the current approach.
As my old friend Professor Lord Desai observes: "Despite all the talk of creating jobs for the young, the euro area offers its people hopeless capitalism for the foreseeable future. The talk may be about growth, but the pact is about zero deficits."