MERVYN King, the Governor of the Bank of England, has warned that in the year ahead we will face the most dramatic fall in living standards for 80 years.
Wages will fail to keep pace with inflation, take home pay will end the year worth the same as in 2005, and disposable income will be soaked up by the financial crisis.
Oo-er. Sounds as if we are going from bad to worse. But how difficult was life 80 years ago, in the 1920s and 1930s? Was it all outside loos and a shared tin bath once a week in front of the kitchen fire?
I've head a peek into the past to see what we can expect.
Back then, the global depression led to the Great Slump in the UK. There was a General Strike in 1926 – and two strikes by police during the same decade – but by 1930 there were still two million people out of work (in a population of 46 million). There was no Health Service. And indoor plumbing for many people really was a dream.
Mind you, the British Empire was doing well. In the 1920s it comprised more than 30 nations and 400 million people and covered a fifth of the earth’s surface. Find an old map and marvel at all the pink bits.
Films were silent (until 1927), greyhound racing was introduced from America, Marie Stopes founded Britain’s first birth control clinic, John Logie Baird invented television (I wonder what he would think of it now) and by 1928, all women over 21 could vote.
However, it was still frowned upon for married ladies to work. They were expected to stay at home and raise the family. Teachers, for instance, had to give up their career when they got married.
Alternative beliefs flourished after the death and destruction of the First World War. Eastern philosophies and Celtic or pagan myths offered a different kind of spirituality for an era that suffered from recession and unemployment, but which was full of modern ideas and the very idea of modernity.
These were in part summed up by ragtime jazz, flappers, the new fashions for women that revealed more flesh than ever before, the wild dances of the Shimmy, the Black Bottom and the Charleston, and icons of the age such as the free-spirited Louise Brooks.
London had an eight million population, at this time, and was the biggest city in the Western world. It was so big that some London County Council politicians called for Home Rule for the capital.
Shame they didn't get it. By now, we could be living in the Republic of Yorkshire.
Ordinary people struggled, of course, but they survived with a growing optimism, as is displayed by predictions for the future made 80 years ago.
Experts even proclaimed that a Channel Tunnel would be built – by 1940. They were just a few decades out.
Every household would have its own lightweight aeroplane and road traffic would disappear; the Sahara would be irrigated to make a holiday resort for Europe with a beach bigger than Morecambe, and chaps would only ever own three outfits at a time: one each for work, leisure and formal occasions. I know blokes like that.
I'm not sure I'm looking forward to the return of the austerity of the1920s and I certainly would not like to see the police going on strike. But it will be nice for television to be invented again, seeing as I've just got a new one, and bring on the Charleston, flappers and those wonderful ragtime fashions.