As Pete noted earlier we can expect the government to announce a new string of measures to try and get the banking system moving again next week. The key political question is whether action from the Prime Minister revives his poll rating or whether the public conclude that this means that the government’s first effort failed and that it doesn’t know what it’s doing.
I’ve spent most of today at the Fabian Society conference and sitting on a panel with Peter Mandelson I was particularly struck by this comment from him:
“No one responsibly would say that this is all that needs to be done to put right what’s gone wrong … We’ll get there but it will take more time, more ingenuity and possibly some further trial.”
I suspect that the public is not inclined to be patient right now, but we shall see.
Mandelson, who turned in a commanding performance, dismissed how effective income tax cuts would be in getting the economy moving again. This will please the Tories, before the PBR they were worried about how politically potent an income tax cut could be for the government. Recently there have been rumours, stoked by John McFall’s kite flying, that the government might do an income tax cut in the March Budget but that now seems almost certain not to happen..