Danger looms as recession bites

I'VE been following the dispute which blew up on Humberside over the employment of Italian and Portuguese workers on a construction site at an oil refinery with increasing alarm.

Paul Geater

I'VE been following the dispute which blew up on Humberside over the employment of Italian and Portuguese workers on a construction site at an oil refinery with increasing alarm.

There does seem to be an unpleasant undercurrent of racism and xenophobia at work - the kind of undercurrent that can be very dangerous at times of economic difficulties.

We hear often that we are in the middle of the deepest recession since the war - some people have compared the current situation with the Great Depression of the late 20s and early 30s.

If things really do turn out that bad, there is cause to be very concerned at the impact that the dispute in Lincolnshire could have across the country.

Just look at what happened in Germany in the 1930s.

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I am not saying that what has started as a small dispute on the Humber will end up with concentration camps, millions murdered, and another world war.

But the kind of pressures that allowed the Nazis to take over Germany do exist to some extent today - and we have to be very careful not to allow extremists to profit from them.

Already there are reports that the British National Party is stirring up the controversy for its own ends. That's worrying in itself.

That is not to say that plant operators Total and the contractors they have employed are completely in the right - they have behaved badly and inflammatorily in the current climate.

If Total did not know that their contractors were going to ship in foreign workers and not recruit anyone locally then they should have before they drew up the contract.

On the face of it, the contract barring British workers from applying for the jobs does fly in the face of EU legislation - and from that point of view workers in Lincolnshire do have cause for anger.

And the foreign workers haven't helped the situation by making obscene hand gestures at the protesters.

But overall the situation that has now developed is incendiary. Total can't understand what it has done wrong. The contractors haven't made any comment. Their workers have made a visual comment that has stirred things up.

This has all the elements needed to spark a very nasty situation . . . just what the country needs on top of all the other problems currently facing the economy.

Back in the 1970s economic problems led to a rise in support for the National Front and riots in the streets as people felt the need to demonstrate their opposition to the racists.

It would be a tragedy if those dark days were repeated.

I'VE lived through several recessions - at my reckoning this is the fourth I've been through since I was a student in the mid-1970s.

Right now we are in the eye of recession. People are losing their jobs. And money is much tighter for even those who are feeling relatively secure.

We are often told by politicians and business leaders that we will emerge from recession. It won't go on for ever. And that is unmistakably true.

The problem with recessions, certainly something I remember from the early 1990s, is that it's impossible to notice when you start to emerge from recession.

Back in 1992 the economy started to emerge from its darkest hour the moment the country left the ERM on Black Wednesday - but it wasn't until about 12 months later that the green shoots of recovery really started being noticed.

By then the Conservative government's credibility was shot to ribbons anyway and while Kenneth Clarke's financial management steered the country on the way to recovery, politically his party has taken nearly a generation to recover its popular appeal.

Anyone who talks about green shoots now is really setting themselves up to be shot at - and with factories laying people off and financial services companies contracting that is hardly surprising.

But eventually the green shoots will clearly start to appear.

The problem is, of course, that not all the indicators will start going in the same direction at the same time.

Experts say that the FTSE index will start to rise first, followed by an increase in general production. Falling unemployment - and a rise in the number of jobs in the economy - is likely to be the last indicator.

On that basis even if the economy is starting to bottom-out at present, then it could be some time before the jobless figure falls significantly.

However, there is, of course, another factor that needs to be taken into account during this recession.

Over the last 15 years the number of migrant workers in this country has risen. How many of them will hang around if there are not the jobs for them to fill?

How many Polish plumbers will find it easier to find work in Warsaw than Woodbridge?

No recession is the same as the previous one. We are now in the middle of the recession and things do feel bad - they always feel worse than ever before while the economy is bouncing along at the bottom.

But we must guard against hopelessness. The green shoots might not be showing yet, but we have to hope that the seeds that are being sown by the government and business in the middle of the economic winter does eventually thrive when sunnier economic climes appear.

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