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Three reasons why I expect a #vshapedrecovery in the UK economy, using the analogy of a car...

1. Activity slumped in March in April because #Covid slammed on the brakes. Now the foot is off: the #lockdown is being lifted and consumers are regaining confidence to spend again...
2. The car was in pretty good condition before the pandemic struck. In particular, the UK’s relatively flexible economy and labour markets are good at creating #jobs to replace those that are lost (#unemployment was <4% at the start of 2020, compared to >7% in the euro area)...
3. Most commentators seem to be looking in the rear mirror – e.g. at Q2 #GDP, or how many people have been on #furlough. But more timely surveys and hard data show that the speedometer is gradually climbing. And there is a tank full of pent-up demand.
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Julian Jessop
@julianHjessop
I see some are arguing that the economic hit from #coronavirus means we should now extend the #brexit transition period (or even #rejoinEU 🙄). They typically make up to four points – but none of them seem at all convincing… (1/6)
First, that it's now much harder for UK and EU negotiators to travel and meet in person. But so what? This is the age of video conferencing and the internet, and we can surely work around this... (2/6)
Second, that government energy spent on #Brexit negotiations would be better spent on dealing with #coronavirus. I have a little more sympathy with this point, but don’t we still have enough ministers, civil servants etc to do more than one thing at a time? (3/6)
Read 7 tweets
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Julian Jessop
@julianHjessop
If Jeremy #Corbyn becomes PM on Friday 13th, here's my rundown of 13 of #Labour’s worst policies which will hurt many, not just the few.

PS. I could have chosen a completely different 13, and these are in no particular order… (thread)

#GeneralElection19
1. Expropriating up to 10% of the value of corporate equity. Employee share ownership is usually a good thing, but dictating the terms would deter job creation and investment, and encourage firms to relocate overseas. More explanation here... capx.co/the-10-share-p…
2. Rent controls. Almost all economists agree that these are a bad idea and, like many of Labour’s policies, would actually end up hurting the very people they are supposed to help. And before replying ‘well, it works in Germany', read this… iea.org.uk/blog/qtwtain-h…
Read 14 tweets
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Julian Jessop
@julianHjessop
The main users of railways are commuters, who are relatively well-off and most likely live or work in London and the South East. So cutting #railfares by 1/3 would increase both income #inequality and regional inequality.

(snips from factsheets here: gov.uk/government/sta…)
To be fair, distributional impact also depends on how lower #rail fares are funded. Higher taxes on car ownership and/or use might even the impact out a little, and could be better for the environment, but plenty of poorer people rely on cars too.
Finally, remember any environmental benefits rely on more people travelling on trains which are already overcrowded. Much better to use the money to improve infrastructure than cut #railfares, especially as users themselves will benefit from this too.
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