So today’s the day; the day Alistair Darling will confirm that Brown’s current fiscal rules are to be scrapped. Now, the rules have always been more of a fiddle than a useful economic tool – to meet the “golden rule” that the budget remains balanced over the course of the economic cycle, Brown blithely changed his definition of the economic cycle; and his use of off-balance sheet trickery to meet the “sustainable investment rule” is well-documented. But the worry is that if those fiscal rules failed to constrain Brown, what will he be able to achieve – what debt will he be able to accrue – under a more “flexible” framework? One shudders to think.
This is now a battle of political narratives. In the red corner, we have Brown at his cunning best – reducing the argument into “responsible borrowing vs. irresponsible spendthriftery”, just as he reduced the tax and spend argument into one of “investment vs. cuts”. And in the blue corner … well, to be fair, are Tories are starting to articulate a more coherent case against the Brown plan. George Osborne rails against it in today’s Telegraph, whilst Cameron has rightly called the fiscal rule decision a “con trick”. There’s still a sense, though, that the Cameroons are yet to hit upon the most effective lines of attack. They’ll find some inspiration in Larry Elliot’s excellent article in the Guardian today – his line that the UK economy is “mutton dressed up as lamb” deserves repeating.
Comments