The Scorched Earth policy has begun. The FT has a hugely significant story – that the Treasury is “working privately on plans to reform Gordon Brown’s fiscal rules” which would “initially allow for increased borrowing”. In the vernacular, Brown has realised that if the Tories win the next election the he is now spending with Cameron’s Gold Card – every by-election bribe, every union sellout will be funded by borrowing with the bill sent to D. Cameron Esq. Cameron will have to tax us to pay for what Brown is today spending.
The Treasury is claiming that it was always going to “review” its 40% limit after the current economic cycle ends. It will struggle to find a single sentence in any speech that will corroborate that. Danny Finkelstein said on Newsnight that this will undermine the whole New Labour project. My take is that Brown doesn’t care, not any more. Like a retreating army, he doesn’t want the advancing Cameroons to have any advantage at all. Debt is a boring subject, but it means we’ll all pay more taxes for longer. I have blogged here before about Brown’s existing ballooning debt, and here about how Britain over the last decade ramped up debt while properly-run countries vastly reduced it. This is big, serious and a problem: the consequences will be with us for years.
You might think this too jaded, too cynical, too conspiratorial a view of politics and policy. But that would be to forget the psychology of the man: bitter and vengeful throughout his years at the Treasury, Brown was happy to stymie his own government, simply for the pleasure of thwarting the Prime Minister. He elevated caprice and faction above all else. Why should anyone suppose his essentially petty view of politics should have changed now that he's in the top job?