Why both the Tories and Labour now want a fight on the economy

Tomorrow, in a sign of how keen the Tories are to keep the political debate focused on it, both David Cameron and George Osborne will give speeches on the economy. Cameron will announce that he is bringing forward a scheme to offer first-time buyers under 40 a 20% discount on 100,000 new home. This scheme had originally been slated for the Tory manifesto but will now be up and running before May. Inside Number 10, they hope that this scheme will help demonstrate that there are tangible benefits for voters to sticking with the Tories and their long term economic plan.   Later on, Osborne will use an address in New York to challenge Ed Miliband on whether Labour would repay any of the national debt. He’ll argue that if you aren’t planning to run a surplus by the end of the next parliament, then you’re not serious about ever repaying any of the debt. As one of his allies says, ‘‘If you are not going to pay down your debts after seven years of growth, then you are never going to.’   But Labour won’t, this time, shy away from a fight on the economy. Ed Miliband is convinced that the autumn statement has given Labour a chance to persuade the voters that the Tories are on a dangerous, ideologically driven mission to cut back the state. He’s also been told by his American guru David Axelrod, who was in town last week, that Labour can’t cede economic competence to the Tories.   The Tories think that when the argument is on the economy, they win. But Labour think they can now persuade voters that in the next five years, Cameron and Osborne will shrink the state in alarming fashion. So, for the first time in almost two years, both sides now want to fight on the economy.