"...this camp – I suppose you can call them "Blairites" – do not see any contradiction in demanding [a stimulus in the next Budget], followed swiftly by a longer term pledge to bring down the level of spending by the state. They are not thinking of one-off chops (appealing as a surgical removal of £25bn on Trident or £4bn on two new aircraft may be to some) or money saved on "waste", the gift that keeps on giving.
Instead, they are erring on calling for more frugal ways of doing fewer things. I predict speeches by senior figures of the left in June, after the local elections, making the argument for a ceiling to be put on public spending, which should, in the long term, come down to lower than what it is now (and they don't just mean after RBS and Lloyds are sold off)."
To be fair, the Tories have been ramping up their spending cut narrative recently. But their slowly-slowly approach does mean there's space, at least temporarily, for a more radical message which could prove popular with the voting public. Problem is, I doubt Brown would ever let Labour jump ahead of their opposition on this, however much fiscal sense it makes. There's little evidence that the PM's own enthusiasm for the "Tory cuts" attack is waning, as he continues to borrow the nation's finances into oblivion.
The main winner from Brown's approach will be the Tories, as they have time to develop a sane alternative to the PM's economic management. The main losers? Why, the taxpaying public, of course.