But it certainly has helped us to achieve a significantly better macro-economic performance over the past few years, and that in itself has helped in addressing at least some of our social problems. Over the eight years or so since the last recession in the early 1990s retail price inflation - on the Government’s target measure - has averaged some 2¾%. That’s a lower rate for longer than anyone can remember. This much greater degree of price stability is a “good thing” in itself - economically because it contributes to more rational, longer-term, decision making, but also socially, because it is typically the poorer, less financially sophisticated, sectors of society - for example those living on low fixed incomes - that suffer most from inflation. But low inflation is not simply an end in itself. The real benefit is that alongside sustained stability we have experienced the longest period of quarter-by-quarter growth since quarterly records began. Over the whole period annual output growth has averaged a little over 2¾% which is significantly higher than the earlier trend rate of around 2¼%. But more even than that, employment has increased steadily by nearly 2½m people over the same period, so that the number in work is today the highest on record. And unemployment has progressively fallen almost month by month on a claimant count basis (though with a slight setback last month) and the rate of unemployment is just about the lowest rate we’ve seen for about 25 years in the UK as a whole.
There is the same need therefore to make hard choices between alternative means, and the international process for making those choices is inevitably more complicated than in our national environment. To take some examples, there is substantial evidence that increasingly free world trade and increasing freedom of international capital flows are contributing to unprecedented rates of growth in the global economy as a whole and more rapidly rising living standards in almost every region of the global economy. It is certainly possible to argue even so that the free trade playing field remains tilted against poorer countries, or that it should be tilted more in their favour: distinguishing between self-interested protectionism and “fairness” or equality of competition is not wholly straightforward. But there would be a real cost to all of us, including particularly the poorer countries, if we were to be tempted to throw the baby out with the bath water and retreat behind trade barriers. 5  BIS Review 110/2000  Similarly we have recently seen all too clearly the damage that can be caused by the volatility of international capital flows - but we need to set that against the positive benefits - in terms of potential growth rates - that had previously resulted from massively greater private sector capital investment in many of the emerging markets, and which has now resumed.