Mike's Blog

I think the current ongoing fuss about MPs’ expenses is good for the economic recovery of the UK.

What fuels the economy?

Well economic health is all about confidence. Traders, especially on the stock market, behave generally as a herd – if the herd takes fright they all run. So stories about economic failure, increasing unemployment, shops closing, firms going bankrupt and the size of the national debt all fuel the fear, both among traders and the general public. This fear breeds more fear, so people stop spending, firms stop investing, banks stop lending and it all heads for the cliff.

So how does MPs fiddling their expenses help?

Mainly it gets the economic news out of the headlines. Much as I’m bored with stories of MPs’ moats, duck houses and phantom mortgages – even to the extent of my refusing to accept the Daily Telegraph when it was free with a bottle of water – the fact that it, BBC, ITV and Sky news, the blogosphere and most of the other UK national media have given the MPs expense scandal headline coverage means that they have demoted the economic news to the inside pages.

There are some disadvantages to this change of emphasis. We see a lot more of Nick Robinson and the rather irritating Robert Peston, and nowhere near enough of the lovely Stephanie Flanders on the 10 o’clock news. But overall what it’s done is reduce the importance of the economic crisis in the mind of the great British public (GBP).

So when the GBP is out shopping it tends to forget that it decided not to buy clothes, not to move house and not to buy that new flat screen telly and just does it. This all helps with the move towards an economic recovery.

So inadvertently our democratically elected representatives in claiming for dry rot treatment in a house nowhere near either their constituency or Westminster, and for two DVDs of one of their own speeches, have actually helped move the country’s economy towards recovery.

Well done I say.