The central tensions undermining Brown's "Tory cuts" argument

RobertD

Halve the deficit = halve the rate at which government debt is increasing in five years time. No concept of ever reducing the debt back to a sustainable share of GDP. Brown v Darling = Charlatan v Knave

David Bouvier

Looking at the IMF report mentioned in the interview, we can add the IMF to the list of people who agree that Brown and friends are telling a Big Lie about "investment vs. cuts". Since it is IMF-ese I put translations in square brackets.

"The Pre-Budget Report and the 2009 Budget already announced consolidation plans through 2013/14,

[e.g. CUTS]

taking account of risks to the outlook. Fiscal commitments would be strengthened by:

• Targeting a more ambitious medium-term fiscal adjustment path for implementation once the economic recovery is established. The focus of this adjustment profile should be to put public debt on a firmly downward path faster than envisaged in the 2009 Budget.

[Actually you need even bigger cuts than the budget said]

• Providing greater clarity on the specific measures needed to achieve the adjustment path, including in the context of the next Comprehensive Spending Review. The emphasis in current plans to weigh the adjustment toward expenditure reduction is appropriate in light of international experience that expenditure-based consolidations are more durable.

[you need to start planning for this, and don't think about trying to do this through taxation instead of cuts]

In addition, long-term sustainability would be enhanced by implementing structural reforms to address rising costs related to demographic change.

[you have a structural deficit, and a demographic timebomb - this is not just a short-term problem. Did I mention public sector pensions for example...]

• Allocating any upside surprises to growth or revenue to reduce deficits more aggressively and limit the accumulation of public debt.

[Don't spray any windfalls around - this is going to take years and years]

• And finally, building a broad public consensus on the critical need for sizeable fiscal adjustment to assist in meeting fiscal challenges.

[Stop telling lies - no one believes you any more]

Simon Stephenson

I don't think you should make too much of this. Darling's Labour through and through, which means he must, by definition, be a serial misleader. Labour dreams and Labour reality are always so far apart that when in government it's a constant battle to prevent the reality from puncturing the myth.

All I think that Darling has is a slightly thinner skin than his rhinocerous-hided boss. Unlike Brown, there is a limit to how far he's prepared to exploit the public's in-built respect for authority, per se. Deep down, Darling knows that a great deal of what he and Brown are saying is being absorbed because he is the Chancellor and Brown is the Prime Minister, NOT because it is has any quality or acuity.

He knows he cannot match Brown's depth of contempt for the people he is "leading", because Brown's contempt-well is bottomless.

barnacle bill

Perhaps Glove-Puppet has decided a quick humane ending for Broon was too good for the PM.
Instead a death by a thousand cuts for the remainder of this government is G-P's revenge.

Ian C

The provocation for Darling will become too much sometime soon. He will have his hand on the dagger when it is finally plunged in.

Tiberius

Thank you, David Bouvier, for a very helpful contribution.

The Laughing Cavalier

Brown rhinocerous-hided? I think not. Rather, he is excessively thin-skinned but his monumental pride leads him to hide his wounded feelings. Then he gets his bully boys to lash out on his behalf. Pride is one of the deadly sins that he claims to have learned to avoid when he was a son of the Manse. He probably unlearned the lesson about the same time he mislaid hs moral compass.

Frank Goddard

Oldtimer the other day in his blog put it simply.
If you have expenditure of £4,and income £3,then you are broke.I dont want to get into specifics of this and that.Mr.Micawba in Dickens novel, was right in his explanation of income over expenditure,and I have based my family wealth on this formula'over the years.Borrowing can only be had if you can guarantee income over any period of time.This is where socialism fails.The Labour party think,still,even after their "no boom and bust policy" was destroyed,that utopia is always just round the corner.that is why they will never understand "Capitalism",because capatilism is and always will be a dirty word to them.They will never be able to balance their books,just like the people who vote for them cannot either.
Frank Goddard ....English pensioner

mart

David Bouvier - excellent!

But you didn't mention the "IMF thinks UK HMG is doing the right things" line we've heard from a few HMG ministers over the last few days/weeks.

If that's in there (and I seem to remember posts from the Spectator guys on here at the time) then that might be worth adding as a footnote to your post.

JONNY

I'm afraid to say Lansley committed a howler. That 10% stuff is pure box office poison and will continue to resonate and to echo.
Oh dear oh dear, don't we all know the average voter cannot take too much reality.
And when the dust has settled,
people will certainly understand Labour must cut too. But there will remain a feeling their cuts may be kinder. More humane. Less draconian. More aware of people's needs.
The other problem the Tories have is that if you took away Cameron, they'd be even lower than today's Populus shows them.
He's the one asset they've still got.

FRANK O'CONNELL

Thanks Frank for your wise words.
From another old timer(just turned 73)

Simon Stephenson

The Laughing Cavalier : 11.22am

Yes, you're quite right. Sorry about that.

I was looking for a more earthy way of setting out that Darling probably has an inner embarrassment that limits his capacity for shamelessness, whereas Brown, it seems, hasn't. Thick-skinnedness (?) isn't what I was looking for, but my brain got into a loop that insisted it was.

I still can't reach what I was looking for - can anyone help?

Hj

The deficit is approaching £200bn p.a., so halving it will still leave £100bn per year, which is pretty much what most economic commentators reckon is the size of the structural part of the deficit taking out the cyclical element due to the recession.

This means that Darling has absolutely no plans to reduce the structural deficit. This is plainly irresponsible.

Hysteria

Mart - re your comment on DV's (good) post...

I think the whole passage is the "IMF thinks we are ok" - my attempt at a translation would be

[We write all this stuff in incomprehensible jargon so as not to scare the natives, but any reading between the lines will tell you we are not happy at all]

David Bouvier

Mart/Tiberius - thankyou.

Broadly they do agree that preventing the collapse of the financial system, recapitalising banks, and stop the economy going into a death spiral were the right thing to do. So do I for that matter.

They also note the importance floating exchange rates had as a "shock absorber". They are not yet concerned about inflation.

The details of when and how, and who got us into this mess in the first place also matter but are not their topic.

I recommend reading it. It is a bit turgid but but not that long. You do have to read between the lines and see what they are not saying.

A few key 'attack' points:

They point out that quantitative easing should include commercial as well as government debt, as it was supposed to.

They repeatedly mention the need to get the deficit under control and reduce debt, and note that the deficit is structural and worsening - not just due to the crisis.

They expect the decline in GDP to slow and recovery to begin during 2009 - as do most people. But remember that is the end of the beginning only. And they expect the recovery to slow and that we will be vulnerable to shocks.

Gordon's tripartite regulatory needs to be improved, and better communication between Bank, Treasury, and FSA is needed.

They make a big point of praising BoE independence, and praising certain arrangements that support it. They seem to be worrying that the crisis is undermining perceptions of independence and cynically (I am guessing) there may be some other institutional arrangement they are making an invidious comparison with.

For the text go to:

http://www.imf.org/external/np/ms/2009/052009a.htm

Denis Cooper

"we have got to live within our means"

So, what's the best available estimate of how far the government is now living beyond its means?

It is

Expenditure £5, income £4, so borrow £1 out of every £5 spent

Expenditure £4, income £3, so borrow £1 out of every £4 spent

Expenditure £7, income £5, so borrow £2 out of every £7 spent

or what?