David Blackburn

It’s turning into an extremely good week for Osborne

It’s turning into an extremely good week for Osborne
Text settings

The gods are smiling on George Osborne. On Monday, he wrote an excellent article in the FT, explaining why he opposed the government’s fiscal plans and giving a brief sketch of his alternative vision. It was a short, sharp, shock article that contrasted with the tentative and nebulous announcements that characterised the Tory post-New Year slump.

They were immediate benefits. On Tuesday, the EU Commission broadly supported the Conservative position on reducing public spending, and today a City AM poll indicated that 77 percent of a panel of City experts think that cuts must be made this year. Indeed, many panellists rejected Samuel Brittan’s contention, elucidated in last week’s Spectator, that the markets expect the continuation of current strategy.

Osborne has long been mistrusted in City circles, I think, because he is competent and will end the reckless free for all that Brown propagates. Whilst this latest poll is not a personal endorsement, it emphatically endorses his policy. With Ken Clarke wooing voters and Osborne bringing the City to heel, away from Brown’s sweet nothings, the Conservatives campaign is re-invigorated. The problem now is burying Ashcroft. 

UPDATE: The Tories are on the economic ball at the moment. One of the reasons is Ken Clarke, whose geniality, skills as a communicator and his candour appeal to voters; in stark contrast with Brown, who has been cursed with Bill Sykes’ shifty jowl. Clarke’s given an interview to the Standard where he states the facts plainly:

“These are artificially low interest rates. They obviously can’t stay as low as this.

“Anybody buying a house now must realise the rates are unnaturally low and will go up in future years. In working out whether you can afford a house, you have to work out if you can afford a quite perceptible increase in interest rates, regardless of who the government is.”

That looks a risky statement, suggesting that rates will go up regardless of who wins, but it's good direct politics from Clarke. Anyone who has borrowed money understands interest rates. They understand the mechanics of interest rates and what affects them. Brown has kept interest rates low, but artificially, so there has to be a penalty in the long-run. Expect Clarke to continue making these points as polling day nears.