Not sure what Alistair Darling was smoking when he told the Guardian that current economic times are "are arguably the worst they've been in 60 years".
60 years ago, we were labouring under national debt that was 250% of GDP, we still had rationing, top rate of tax was 99%, we had borrowed desperately from the USA (that loan was only paid off in 2006), the conditions of the loan required that the pound be made convertible, oil and gold priced in dollars not sterling and the commonwealth opened up to American trade. Not surprisingly our currency reserves drained away within weeks of making the pound convertible. This was really serious stuff.
I'm sure Darling was indulging in hyperbole when he suggested the current situation is as bad as 60 years ago. One quarter of zero growth does not turn things to how they were 60 years ago (or even to the early 90's, when we had seven consecutive quarters of negative growth - 21 months, or early 80's when we had six consecutive quarters of negative growth - 18 months).
Revised US growth figures came out on Thursday. According to the latest estimates, their growth has been as follows:
Q4 2007 -0.05% (annualised equivalent -0.2%)
Q1 2008 0.2% (annualised equivalent 0.9%)
Q" 2008 0.8% (annualised equivalent 3.3%)
So they appear to have come out of their troubles. Our cycle is lagging behind theirs, but their recovery is hopeful given their massive effect on the world economy. In September tax rebates go out to Brits, oil is lower, wheat and corn prices are lower, most householders do not need to borrow further money. There is no reason there shouldn't be a recovery. Of course disasters could still happen - the American mortgage companies, Fannie Mae and Freddie Mac may go under, but it is certain that the US government will step in and take over the liability, and life will go on.
Alistair Darling needs to be careful how he speaks. Economies run on confidence and one of the main jobs of the Chancellor of the Exchequer is to provide reassurance and confidence. It's not a co-incidence that our poll rating really took a dive after the spring budget. Voters knew there was a global crisis and were looking for staunch reassurance from government. For the first time in eleven years Labour did not provide it. Not surprisingly his ratings are almost as bad as Gordon Brown's, but unlike Brown he hasn't been the recipient of sustained personal attacks, the ratings are a perception of how he is doing at the Treasury.
You would not catch a statement like the one Darling just made from the US treasury or the French and German finance ministries. Mr Darling needs to get to grips with the fact that his primary purpose is to inspire confidence and ignorance about economic history (the 60 years comparison), and related scaremongering certainly don't inspire that.