You have to admire the way George Osborne and Nick Clegg are handling the public spending debate. They’re playing a blinder, and they’ve got some excellent allies. Later this month they’ll cut the UK Government’s budget by 25%. Or is it 40%? The Navy will be forced to put to sea in contraptions made of hemp and ice, the handful of doctors and nurses that remain will be forced simply to kiss it better, and no new schools will ever be built again. It’s a disaster, an exercise in ideological cruelty, with cuts so savage they’ll make Geoffrey Howe’s 1981 austerity budget look like the Milky Bar Kid just showed up.
It’s Labour’s fault, all Labour’s fault, and even Labour agrees. Never mind that each time Labour bent over backwards to facilitate the markets, the Tories urged them to bend further. No deregulation was ever opposed by them, or by the Lib Dems, or indeed by the SNP.
The left have fallen for it entirely, and could not be helping more directly if the Treasury was writing their content for them. On the media side, Polly Toynbee says today “Conservatives know their captain and his mate are storm-chasers, deliberately steering straight into a force 10 hurricane with the spending review on 20 October.” John Lanchester mocks up Osborne as Edward Scissorhands. Labour’s conference talked of nothing else (aside from some family matters), and left bloggers write about little else. You can’t cut a quarter of the entire UK Budget? Won’t someone think of the children?
Except it isn’t going to happen. On the 20th of October the Chancellor will set out his Comprehensive Spending Review, and, magically, nothing will be as bad as we thought. Lollipop ladies and gentlemen won’t be sold off to foreign parts, and children in dank Victorian dinnerhalls won’t have to eat broken-up old aircraft carriers at lunchtime.
Some detail in the latest statistics isn’t as bad as we’d expected, he’ll say. I’ve spoken to my friends in the City, and they’re comfortable letting spending decline much more gradually than planned. 40%? Nowhere near. 25%? Not even that. We can still tackle the deficit without the pain we’d all feared. There will be no capital flight, no increase in the government’s cost of borrowing, and our triple A+ with a gold star rating can be maintained. The nation will breathe a sigh of relief, and Labour’s attack lines will suddenly pop like a soap bubble. Nick Clegg’s people will again brief that it’s the moderating influence of the Lib Dems in office that saved us all, the particularly cynical media strategy this coalition has afforded both parties, and the polls will show a bounce for both the coalition parties.
The trouble is that there still will be savage cuts. Maybe around 15%, perhaps up to 18%. And that’s still eye-watering punishment for the poor, an end to countless programmes intended to moderate the effects of poverty, ill-health and poor education. The fact that it’s significantly below what we were threatened with is entirely irrelevant.
If I was a steely right-wing ideologue like Osborne or Clegg, with a desire to weaken the state and ram through a neo-liberal economic settlement more extreme than anything even Margaret Thatcher achieved, I’d warm everyone up with warnings of massive cuts. They started with 25% but then it looks like they realised that was too close to their actual plans, hence the absurd 40% figures subsequently floated. In their position, if I had any intention of cutting 25% from the budget I’d have started with threats of 35% first off.
This period of deft high-balling by the Coalition and feckless stupidity from the left will make their cuts very hard to oppose. The public have been softened up, and Labour will flounder. There was a point where they could have set out a strong narrative here, but it was before they left office. Alastair Darling could have explained basic Keynes to the nation, that cutting public budgets in a recession just deepens it. Labour could have apologised for building up the deficit during the boom times, but then passed some kind of budget responsibility legislation to guarantee that wouldn’t happen again.
They could have said “this is a time for a principled choice: the Tories will cut services to the poorest, but we will raise taxes on the richest, and on the banks who got the country into this situation”, cleverly glossing over their own role in that deregulation. Instead they sold the jerseys, with Darling promising some £78bn of cuts, a move which makes any argument they have with Osborne or Clegg mere quibbling about the details.
In fact, the spending review will be exactly what the left say it is, an ideological move to reduce the size of the state, to leave the rich free to make more money and the poor free to fantasise about being rich. But we’ve fallen into their trap about the specific scale, so who will be left to make a convincing argument against it?
Prize competition. I will send the one hundred trillion dollars pictured above to whoever posts a comment containing the most accurate figure for the overall cuts set out in this comprehensive spending review. To one decimal place, please. My money’s on 17.8%.
The two elections that I have been interested in this year have each thrown up interesting results. The UK, a country famed for not doing coalition politics, has resulted in a surprisingly successful pairing between the Conservatives and the Liberal Democrats. Meanwhile Sweden, a country that is typically governed by a coalition of several parties, has for the first time in decades effectively ended up with a hung parliament.
