George Osborne's answer to the weakness of British wages is to deny that the problem exists
George Osborne's autumn statement was an all-purpose political pick-and-mix of tax cuts for shopkeepers and pennies off at the pump, liberally sprinkled with "don't let Labour ruin it" rhetoric.
To the extent that it had a guiding principle, it was to shut down Labour's argument about the cost of living crisis by giving the hard-pressed British public a few goodies, and exhorting them to wait for jam tomorrow, when the "job-rich recovery" really takes hold.
Ever since Ed Miliband's party conference speech, with its promise to freeze household energy bills, the coalition has been scrambling to show that it can do something to ease the squeeze on households: the chancellor's announcement that he would cancel next year's 2p rise in fuel duty was just the latest example.
But of course it's not just rising prices that have contributed to what Labour likes to call the "cost of living crisis", but the chronic weakness of wages in the wake of the 2008-09 recession – and here, the chancellor's approach is to deny any problem exists.
Economists remain divided about the forces behind what the TUC has called the longest wage squeeze since the 1870s, but Miliband argues that it severs the age-old connection between economic growth and rising living standards. According to analysis by the Office for Budget Responsibility, the real wage of the average worker will not be restored to its pre-recession level until 2018.
The Treasury's carefully crafted riposte, spelled out in the autumn statement green book last week, is that rather than a tale of skinflint employers and their downtrodden staff, the weakness of take-home pay is a consequence of the increased cost to employers of providing staff pensions, and paying higher national insurance contributions after the rate rose under Labour.
On that analysis, we might expect wages to bounce back smartly as the economy picks up. In other words, the fundamental relationships in the economy remain undisturbed: nothing to worry about here, move on.
Yet that doesn't feel quite right. For one thing, the Treasury data is based on mean, not median, incomes and, as anyone who can dredge up memories of schoolroom maths will know, a mean can be dragged upwards by a relatively small number of large readings at the top end of the scale.
Second, the beneficiaries of those costly pension payouts are not necessarily the same people whose wage packets have been under attack over the past five years. Many of these beneficiaries will already have retired; many more will be the higher-paid workers who tend to have more generous retirement provision.
And third, pension top-ups and employer NICs are an important measure of employers' costs, but they don't end up in workers' pockets at the end of the week – and you can't use them to pay the gas bill.
But there's more at stake here than a spat about data. Labour's concern with the cost of living taps into a much wider debate about the state and shape of Britain's economy, and whether it can deliver for working people.
The rekindling of the housing market and the rise in consumer borrowing is helping paper over the cracks for some. However, the behaviour of the labour market since the start of the crisis confirms something that has long been growing clear: for many workers towards the middle and bottom of the income distribution scale, the idea of having any bargaining power over their wages, terms and conditions has become a distant dream.
Last month's Panorama programme about working practices at online retailer Amazon encapsulated the helpless, dehumanised existence of many thousands of workers in contemporary Britain. Monitored by machine, they are constantly at risk of being chucked off the payroll if they miss targets or take time off sick.
It's not just a UK problem: in the US, where the wage of the median worker is no higher in real terms than it was in 1997, Barack Obama made a stirring speech last week, addressing the fact that many workers have "the nagging sense that no matter how hard they work, the deck is stacked against them."
This is the same powerful feeling that has motivated the Living Wage campaign in the UK, and pushed it from the fringes of civil society to the centre of political discourse. And it's the same sense of injustice that has motivated a wave of recent strikes across the US among low-paid employees of giant firms such as Walmart and McDonald's.
Solving these problems will take more than lopping a few quid off the average energy bill; it requires a guiding vision of the kind of economy, and the kind of jobs, Britain should be aspiring to. That might mean tackling shortcomings in corporate culture, vocational education, employment law, the finance sector and a host of other areas.
Osborne once appeared to have an economic vision, but it dissolved in the face of hard reality, and instead this recovery looks like a reversion to the "debt-fuelled" growth he once professed to despise, egged on by state-backed mortgage subsidies.
Obama said last week: "I believe this is the defining challenge of our time – making sure our economy works for every working American."
Sadly, Osborne's answer to the British analogue of that challenge is to deny that it exists.