1st August 2011

The Ice Cream Van always pulled up outside my school at 3 00 pm.

What could be nicer than an ice cream whilst waiting for the bus home? Think vanilla or strawberry or chocolate, think the ubiquitous '99', mmm delicious after a hard day avoiding doing any work, avoiding the teachers and failing to answer any questions and studiously avoiding the education that was on offer.

Economics were a case in point, who cared about economic theory, Keynes and all that, when the economics practical was enacted each day outside school at the ice cream van.

The problem that confronted both the ice cream vendor and the pupils of the school was: Did we have the resources to purchase the ice creams?

For the ice cream vendor his business, prosperity and the well being of his family depended on his selling enough ice creams to pay for his ice cream van, his diesel, the ingredients etc and still leave him with a profit.

For the school children their Saturday jobs and pocket money formed the basis of their weekly income which had to be husbanded throughout the school week so that they could purchase their ice cream each day.

It was a good relationship, it worked well, so well in fact that during one particularly dry spell, when funds were low, I opened an account with the Luigi, and enjoyed my ice creams, settling my account after I had been paid for delivering the weekly orders to the customers of the co-op where I worked pedalling an old fashioned butchers style bicycle with an enormous basket around Stoke on Trent for five bob a week I seem to remember.

This was a great innovation because essentially Luigi extended interest free credit to me and I kept my resources for a whole week before paying for my ice cream, I should of course have banked the money and earned interest which would have put me ahead of the game.

Practical economics.

If you want to grow a business or a nations economy then you have to stimulate demand in order to encourage people to spend and purchase your ice cream.

In the big society the ambitious vision of millionaire wallpaper magnets and stockbrokers sons has lost sight of the simple truth that Luigi and I understood, if we didn't buy his ice creams he wouldn't be at the school gate but equally he had to find ingenious ways of parting us from our hard earned money.

John Maynard Keynes, who we were taught about in economics was pretty clear about this, although at the time I could have cared less about Keynes as I was focused on ice cream which is why I left school with one GCE in Woodwork, which was mainly down to my ability to fashion a dove tail joint.

But Mr Cameron and Mr Osborne ought to remind themselves of what Keynes said about growth depending on demand.

Reduce demand you reduce growth.

So there we are as I queue up for diesel tomorrow I know that it will cost so much that there will be no money left over for luxuries like ice creams.

As we tighten our belts in this we're all in this together big society we still expect to enjoy a holiday, although I will be enjoying rain and midges in Scotland rather than Prosecco in Tuscany.

I have no idea where the Chancellor is holidaying but suggest that he needs to reflect that the deeper the cuts, the greater the pain, the less money there is, the lower the demand will be and the growth we are promised will simply not happen.

At a conference recently I came across all Tony Bennish by challenging the speaker who quoted Keynes about digging holes and filling them in again, by reminding him of just how much real work there is to be done in personal social services, work with the elderly, wider community work, public construction of schools and nurseries and how many people who were well qualified for that work are losing their jobs because of the cuts  and who, without that secure income are finding it hard to buy essentials never mind luxuries like ice cream.

Luigi will be long retired and probably will have moved back to Tuscany himself to be looked after by his family.

But I remember his ice creams and the practical economics I learned at the ice cream van .................