THE BLOG
05/12/2013 06:50 GMT | Updated 03/02/2014 05:59 GMT

Goldman Sachs, Newton Daniels and the Phantom Disappearing Act

Political predictions are always a dangerous game. But personalising them or, even worse, threatening to do something drastic if x doesn't happen, risks turning a prediction into an endless source of mockery.

Take the diminutive helium-voiced conjurer Paul Daniels who, six months before the 1997 General Election, threatened to "take his money and leave" if a Labour government was returned. He was joined by the likes of Frank Bruno and Andrew Lloyd-Webber, each forecasting a mass exodus of talent if Tony Blair's band of rabid socialists were given the keys to Downing Street. Needless to say, all three of the above were still firmly British citizens by the time the 2001 election had rolled around.

Not too long after Newton had made his dismal prediction (yes, Paul Daniels' real name is Newton - who knew!?), a series of more credible - if less prime-time - figures were anticipating similarly dreadful consequences for Britain if we didn't join the EU's hotly-tipped new single currency.

Peter Mandelson, apparently forgetting the experience of those who'd prematurely poured scorn on his own political project, wrote in the Sunday Mirror that "staying out of the Euro will mean progressive economic isolation for Britain. It will mean fewer foreign businesses investing here, fewer good jobs being created and less trade being done with our European partners." His dire warnings were followed up by a host of senior business figures - from WPP's Sir Martin Sorrell, to Virgin's Richard Branson - who foresaw the City of London crumbling, a wave of boarded-up high streets and general economic doom if we stayed free of the euro. In retrospect, very few would argue that Britain's freedom outside the euro has brought prosperity and a faster recovery, while the eurozone has declined and its members have gone cap-in-hand to the IMF.

Of course, Richard Branson has now quit the UK, but that's less to do with economic achievements of the euro and more to do with the favourable tax rates of Necker Island...

The common thread with all these dreadful predictions is that those saying them are basing their analysis of the future on one possible outcome - a Labour government ramping up tax rates, the euro being an unqualified success - rather than the several possible outcomes one needs to accurately forecast future scenarios.

The latest fashion is for large businesses to predict job losses and closures in the event of Britain leaving the European Union - with seemingly zero analysis of other possible routes for renegotiation with Brussels and gradual reform. A month ago it was Nissan chief executive Carlos Ghosn saying his company would reconsider investing in the UK if we didn't stay in the EU, apparently Tipp-Ex'ing the word 'euro' and replacing it with 'EU' on a press release issued twelve years earlier. Then yesterday Goldman Sachs' Michael Sherwood threatened to leave London in the event of Brexit - another impressive, albeit quicker, reverse given at the start of September this year he was assuring investors that a "substantial base" in London would be retained regardless of Britain's relationship with Europe.

It is notable that, although Mr Sherwood's remarks have been covered widely by the media, there is very little discussion of under what scenario he believes this huge business decision will be made. Writing for the Spectator, Alex Massie even suggests that the Conservative Party needed to make future tactical political decisions based on one man's questionable predictions!

When notable figures make statements on future political or economic policy it is understandable that the media and politicians will take note of what they are anticipating. Status and soapbox afford some people more chance to broadcast their views than others. But it would be useful if either, they gave us more indication of the thinking behind their predictions, or their words were couched with the proper caveats when reported.