To worry or not to worry over the economy?

“Very worrying” was what one Whitehall economic adviser said to me just before Vince Cable insisted in an interview that he was “not worried” by today’s growth figures.

How could you not be worried?

The world’s economy is on a journey into uncharted territory where new economies rise and old ones could flat-line or worse. And politically, the Coalition experiment’s electoral success surely rests on whether the economic commanders have made the right calls on the economy.

Can the private sector make up the ground that’ll be hacked back from the public sector in the economy?

What would the government do if things carried on flat-lining or worse? One who knows the Bank of England Governor well says he’d be very surprised if Mervyn King agreed to more quantitative easing.

It’s far from clear what other levers the government has to hand … but Ed Balls is suggesting they re-think the Budget in March and slow the cuts to the Alistair Darling four year deficit halving plan he (Ed Balls) used to attack.

Interestingly, Gordon Brown’s old ally, Gavyn Davies, says here that growth is too bad to be true:

“I would point to a drop in oil and mining output, which has knocked about 0.6 per cent off total output in the period covered by the graph. This is a result of the fact that North Sea output has now started a long decline which cannot be prevented.

“In addition, business and financial services, to which the UK is particularly exposed, has reduced output by 1.2 per cent over the relevant period. Without these two factors, the under-performance of the UK since the recession started would have been much less, though still not zero.”