Tinkerbell Truss
I had no idea that there was something called the Tinkerbell Effect, but there is. The term describes things that are thought to exist only because people believe in them.
Now it is now an economic principle as proposed by Liz Truss. If we close our eyes and believe in economic growth enough, the recession won’t happen.
It is true that expectations do alter economic behaviour but just banning the mention of the word recession and thinking that means it won’t happen; is as realistic as Peter Pan.
But although it sounds naive and dumb, it is frightening because Liz Truss is making it clear that she intends to use her Tinkerbell economics to go after the Bank of England.
Since predicting a recession is causing the recession, the Bank is to blame and will have to be brought under control.
The Bank will get a new looser remit, lose independence, be told to keep quiet and to believe, rather like in Turkey.
Just the actions that spook the markets, will do nothing to improve the economy, will in fact make it worse and are a classic, deliberate, distraction technique.
Given the length and scale of the downturn and the cost of living crisis this is unlikely to work, but what it really shows is that Liz Truss doesn’t care if it works; so long as she can blame someone else.
Tinkerbell Truss like her predecessor doesn’t accept responsibility or blame.
Fantasy economics is the result, unfortunately unlike Tinkerbell the rest of us live in the real world, not Neverland.
Economics, trade and Brexit, not necessarily in that order but the dog always comes first.