James Forsyth on what promises to be a transformative year in politics
Prediction is very difficult, especially about the future‚ as the Nobel Prize-winning physicist Niels Bohr rightly observed. But there are some things one can predict with (almost) total confidence: in this year there will be an election and by next Christmas one of the two main parties will have a new leader. And by the end of the summer, we will know if Britain is likely to tackle the single biggest threat to its prosperity and standing in the world: the gargantuan budget deficit, 12.6 per cent of GDP and counting.
The election will divide the year. Until election day, the last remaining bubble in Britain — that of public spending — will be protected. Gordon Brown will fall back on his old narrative: that the Tories would cut. But he will also add that the Tories will raise taxes to boot. This is, of course, correct: tax rises and spending cuts will be the medicine prescribed by whoever wins the election. The Tories will try to counter that they are being straight with the public and that Labour’s denial will lead to a fiscal crisis and higher borrowing rates.
Local elections are scheduled for 6 May, and this remains the most likely date for a general election — although all parties like to destabilise each other by pretending they want an earlier deadline. The Tories would like to recreate the fiasco over the October 2007 election-that-never-was — by building up expectations of a March election and then claiming that Gordon Brown has ‘bottled’ it again. But May suits all of them better: more time to prepare for the Tories, and more time for something to turn up for the Prime Minister.
The dynamics of the campaign will be even more presidential than usual. The prospect of a leaders’ debate (which all parties expect to go ahead) will put personality at the forefront of the fight. Labour will portray Brown as a statesman who made ‘the call of the century’ in ‘saving’ the banks and has shown leadership while the Tories dithered. Brown’s trip to Copenhagen and the London conference on Afghanistan in late January are all designed to create the impression that Brown is a considerable figure on the world stage in comparison to the novice Cameron. Labour believes that it must undermine Cameron’s appeal if they are to deny the Tories an overall majority (their most realistic goal). The Tories’ greatest weapon will be Gordon Brown. They will simply ask voters if they want five more years of him.
The weeks and months that follow the election will define the next four years. If the Tories win an outright majority (as I expect) they will produce a budget within 50 days and lay out financial projections for the medium term. Then judgment will come: will this assuage the bond markets and the rating agencies or will it become more expensive for Britain to borrow, sending the country into a downward spiral? The budget must also produce an agenda for growth, likely to take the form of corporation tax cuts (as this column revealed in October). The level being spoken of is a rate of 20 per cent, which would be the lowest of any major economy.
Yet most of the drama may come from the opposition benches as Labour commences its civil war. It is customary for Labour to disembowel itself after a defeat and after 16 years without any open debate about strategy there is a lot of pent-up anger to be released. One warring faction will be the party’s remaining ‘social democrats’. They will blame the defeat on Blairism, Iraq and an excessive faith in the market. ‘Investment v cuts’ will still be their preferred dividing line. But elsewhere in the Labour party there is some intriguing thinking going on. Figures traditionally seen as Blairities and those on the soft left of the party are coming together to seek inspiration from Labour’s past. They are pushing for the party to rebuild by re-engaging: rediscovering Labour’s attachment to mutualism and ‘empowering communities’.
Whatever the philosophical battles, Labour’s war will be one of personality. Or lack thereof. The two candidates who are keenest to run are Ed Balls and David Miliband. Neither are particularly talented front-of-house performers, both owe their reputation and standing in the party to their wonkish achievements, not to any political conquests. But more worryingly for the Labour establishment, a contest between the two of them — protégés of Brown and Blair respectively — would threaten to continue the whole Blairite-Brownite feud into another generation.
Like many of Brown’s acolytes, who got to the top by internal clan warfare, Balls has little experience in winning votes in elections. His speciality is intimidation; one potential rival calls him a ‘terrorist’. His bare-knuckled, factional approach to politics will typify his campaign.
His aggressive preparations for his leadership bid are already causing ructions on the centre left of the Labour party. Ken Livingstone has emerged as his cheerleader, telling allies that Balls has travelled further to the left than most people have realised and should be regarded as the best candidate.
But Livingstone had promised support to Jon Cruddas, the standard-bearer of the soft-left who won the first round of the deputy leadership contest. In return for this, Cruddas agreed not to challenge him in the Labour mayoral primary. That deal now seems to have collapsed.
The collateral damage of the Labour leadership contest will be substantial if it does descend into a factional, Balls v. Miliband contest. One well-connected figure in the party says that it will be the job of Peter Mandelson and Jack Straw to call David Miliband on election night and urge him not to stand — and make way for his brother, Ed. The argument is that Ed is not just more tele-genic and talented, but is also acceptable to all the important factions in the Labour party and so could prevent the contest from becoming a bloody civil war.
Every election year we are told that the election is the most important for decades. But this year’s election can genuinely be regarded as the most important since 1983. A bold Tory party which had the courage to fight the election on its own mandate may well be able to salvage the national finances and avoid the nightmare scenario of a debt downgrade, the IMF being called in or worse. A more timid Tory party, which the Tories will have to be if they have not sought a mandate for radical action from the voters or if they are governing without an overall majority, would move more slowly; and speed is of the essence.
Seldom has there been more at stake in an election year. That is why, for good or for ill, 2010 promises to be a transformative year in politics.
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