Cost of living

Who will pay the price for the crisis?

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While politicians clearly have no idea of how to solve the economic crisis unemployment continues to rise across Britain. But where is it having the most impact? Danny Dorling argues that it is the young - "Thatcher's grandchildren" - who will bear the brunt of the recession.

How government reacts to a crisis is revealing. The initial reaction of the British government to the credit crunch was concern for those who initially appeared to have most to lose - those with savings in banks. The reaction was not carefully calculated or well thought out; it was no capitalist conspiracy; it was a reaction replicated around the rich world by exhausted looking finance ministers who knew their advisers were telling them they had no clue as to what would happen next.

Credit crunch: A winning formula?

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The credit crunch has wiped £600 billion - more than £1 million a minute - from Britain's total wealth in the past year.

According to a recent set of figures, which seem almost impossible to take in, these losses are caused largely by falls in the value of houses and shares. They begin to highlight the scale of the economic crisis which is upon us and which shows every sign of getting much worse before it gets better.

The crisis fuels discontent

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Global economic turmoil has led to food riots abroad and spiralling inflation in Britain. Michael Bradley and Judith Orr report on the growing resentment towards the crisis-ridden Labour government

Where did it all go wrong for Gordon Brown? Was it his failure to call a general election last October? Was it the attempt to impose a pay freeze? Was it the vote in parliament to extend detention without trial to 42 days? Just one year into Brown's premiership a recent Gallup poll showed Labour's popularity at its lowest ebb of support since Gallup first asked people to declare their voting intention in 1943. The government is in a crisis that appears out of control and the central issue that is derailing Brown is the economic crisis.

Why the price indexes miscalculate the cost of modern life

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The cost of living rose at an annual rate of 2.2 percent in January if you believe the government's Consumer Price Index (CPI).

This is the rate newspapers and TV report and on which the Bank of England bases interest rate policy. But it is fiction as far as reflecting the rising prices faced by working class households.

For a start, the CPI excludes mortgage payments and council tax. A second official inflation measure, the retail price index excluding mortgage interest payments (RPIX), also ignores such costs but hit 3.4 percent in January. This is sometimes referred to as the underlying rate of inflation, presumably because it is closer to the truth.

Tired of Weighting

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The rising cost of living and shortages of labour means London's workers now have more industrial power.

On the face of it the issue of London weighting payments is not all that thrilling. Nevertheless, it has helped add a bit more spice to the recent upsurge of rank and file militancy which has managed to send the mainstream press into such a lather.

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