Bust to boom

ON MANY occasions in the past few years George Osborne has carried a rain cloud into the House of Commons. Britain’s growth forecasts had been revised down yet again, he would explain; borrowing would be higher than expected. But as he stood to deliver his sixth (and perhaps last) budget as chancellor of the exchequer on March 18th, Mr Osborne was cheery—partly because the weather has truly improved, partly because he was about to deploy a clever ruse.

Britain grew faster than any other economy in the G7 last year, Mr Osborne boasted. The national employment rate, at 73%, has never been higher. The falling oil price has cut inflation, which will this year end a dismal seven-year stretch of falling real wages. The government is saving money on inflation-linked debt interest payments and on benefits, which are often linked to prices. And because oil is largely imported, lower inflation has not dampened domestic tax receipts the way it otherwise might.