Labour party

Friday

David Blackburn

The Tories are paying the price for Osborne’s mercurial political instincts

From our UK edition

I’m at a loss. How can a government that will raise the national debt to £1.4 trillion be trusted to run the economy? The Daily Politics/Com Res poll shows that Labour is more trusted on the economy than the Tories; it indicts George Osborne’s political performance. As Fraser noted, Osborne blew an unprecedented opportunity on yesterday's Today programme. The danger inherent in a £1.4 trillion national debt is not a difficult argument to make. Tax hikes, inflation and soaring interest rates will be the progeny of Brown’s continued borrowing binge. Yet Osborne confined his attack to valid but esoteric points about credit ratings and a list of acronyms. Ken Clarke would not have made such an elementary political mistake.

David Blackburn

A week to forget for Andrew Adonis

From our UK edition

The weekend cannot come quick enough for Andrew Adonis. What an awful week. The BA strike wrecked travel; the absurd Stephen Byers dragged him into the lobbying scandal; the RMT voted in favour of Bob Crow’s surreal steam-era fantasy; and today comes the coup de grace: the High Court decides that the third Heathrow runway is ‘untenable’. Transport is beginning to make Northern Ireland look like a soft brief, but Adonis hides his perturbation. He responded to this morning’s news by saying: "I welcome this court ruling. Heathrow is Britain's principal hub airport. It is vital not only to the national economy but also enables millions of citizens to keep in touch with their friends and family and to take a well-deserved holiday.

Peter Hoskin

What did Darling mean by his “deeper and tougher” cuts claim?

From our UK edition

There's been some hubbub on the good ol' blogosphere about Darling's claim that Labour spending cuts would be "deeper and tougher" than Thatcher's.  Did Thatcher actually cut spending?  What would that indicatate about Labour's plans?  And so on. Part of the confusion is caused by the different metrics that are referred to as "spending".  So here's a quick guide to what Darling might have had in mind: OPTION 1: Real-terms total spending.  As the below graph from the IFS shows (taken from this excellent blogpost by the FT's Alex Barker), real-terms total public spending only fell in two years of the Thatcher premiership.  In all the other years it rose.  Indeed, spending increased by an average of 1.

Thursday

Fraser Nelson

Labour’s spending cuts exposed

From our UK edition

Darling has now exposed as false the Brown/Balls dividing line of "investment vs cuts". If Labour were to win, he said, the cuts would be worse than anything seen under Thatcher in the 1980s. This is Darling's problem: he's a dreadful liar. The IFS today laid out the scale of the cuts that would happen whoever wins the election, and the below graph is worth reprinting. Overall spending falls 12 percent (once dole and debt interest are taken into account). So when Darling says this is worse than anything in the 1980s, he is simply stating a fact. You'd never catch Balls or Brown doing that, by the way, and I hope that, when either pop up for interview, they will be asked if they agree with their Chancellor's assessment.

Peter Hoskin

The two sides of Alistair Darling

From our UK edition

After delivering an insipid, insufficient Budget yesterday, Alistair Darling has now smuggled a little bit of honesty into the fiscal debate.  In interview with Nick Robinson, he has claimed that if Labour is re-elected its spending cuts "will be deeper and tougher" than Thatcher's.  Needless to say, that's a message which will not sit well with his Cabinet colleagues like Ed "investment vs cuts" Balls. And this is precisely why Darling is such a confusing figure.  Yes, he deserves some praise for being more upfront about the public finances than his predecessor ever could be, and for restricting the wilder excesses of Brown and Balls.  But it's hard to forget that he, as Chancellor, hasn't delivered a spending review when we need one most.

James Forsyth

Labour’s plans require non-ringfenced Budgets to be cut by 25 percent in the next parliament

From our UK edition

At lunchtime, the press headed off to hear the referee's verdict on the Budget. The Institute for Fiscal Studies is now so respected that its view of the Budget largely determines the news agenda. Its briefings are now so popular that they can no longer be held in their basement. So, journalists, economists and accountants piled into a room at the University of London Union which is normally used for battle of the bands contests rather than Budget analysis. The most striking number the IFS presented was that if Labour ringfences the already protected areas of spending for the whole parliament, other departmental budgets will have to be cut by more than 25 percent. One dreads to think what the consequences of slicing a quarter off the defence Budget would be.

Peter Hoskin

How to foil a Dispatches sting

From our UK edition

The producer and director behind the Dispatches lobbying sting, Philip Clothier, has a snappy article over at Prospect, in which he basically asks the question: how could MPs have been so stupid?  But it's his suggestion that some former ministers may have got off lightly which really caught my eye: "Meanwhile, one former Labour cabinet minister was interviewed, but the sound was so poor that we could only hear appetising phrases. He had the good fortune to be sitting in front of a brightly lit window, over-exposing the shot. And we just couldn't understand much of what another former minister said because of his thick accent." Cue all MPs adopting impenetrable accents, and sitting in front of windows, from now on.

Fraser Nelson

Osborne’s weak response

From our UK edition

I was all set up to Fisk the post-Budget analysis which Darling normally gives to the Today programme after the Budget - but he wasn’t there. The Treasury refused to have him debate with Osborne which is what Today (unusually) seems to have assumed. Well, we’d best get used to hearing Osborne post-Budget day. At first, I thought it was a coup for the Tories - but as Evan Davis sharpened his claws, it soon appeared to have been a net negative. Osborne just didn’t sound confident. A series of exchanges left him looking unprepared. His line - that he will eliminate ‘the bulk’ of the annual overspend over the lifetime of the parliament - was challenged: what does it mean?

Peter Hoskin

Darling and Brown get away with it

From our UK edition

Strange days, indeed.  While most of the frontpages today are unflattering for Labour – particularly, and unsurprisingly, those of the Telegraph and the Sun – I imagine that Brown & Co. will be quite pleased with the general tone of the Budget coverage.  Much of it mirrors the Independent's view that Darling "played a weak hand well".  Or, elsewhere, there's a kind of detached indifference about what is described as a "boring" Budget. Yes, if you like, you can take that as proof that the Darling-and-Mandelson approach to the public finances is less politically toxic, and a good degree more sensible, than the Balls-and-Brown approach.

Wednesday

James Forsyth

Darling’s nothing budget puts the ball in the Tories’ court

From our UK edition

This year’s Budget was never going to win the election for Labour but it could have lost it. If the markets had reacted really badly to it, warnings about how Britain is in danger of going Greek would have suddenly gained traction. But Darling avoided that fate with a Budget that did little. Listening to it, it was clear that those inside Labour who argued that the strategic imperatives for this Budget had to be appearing credible and not risking an adverse market reaction had prevailed. The mood music was very different from the PBR, with its emphasis on investment versus cuts.

James Forsyth

Fiscal drag

From our UK edition

It is good to see the Tories calling fiscal drag what it is, a tax rise by another name. Fiscal drag is a result of holding income tax thresholds steady while both prices and earnings are increasing. This means that more people have to pay more of their income in tax. Gordon Brown indulging in this ploy so often as Chancellor was one of the main reasons that the number of people paying the 40p rate pretty much doubled between 1997 and 2008. One other good thing about the Tory line on fiscal drag today, is that it will put pressure on them to raise personal allowances and income tax thresholds in line with inflation every year. If they don’t, they will be—by their own definition—raising taxes.

Fraser Nelson

In defence of Alistair Darling

From our UK edition

It's unusual for Chancellors to stand with their wives on the steps of the Treasury on budget day, and to see the Darlings together this morning gives an indication of what they have been through. Brown doubtless thought him an automaton when he appointed him to the job - but I was wrong to say that he would be "no more a Chancellor than Captain Scarlett was an actor". He has defied Brown, bringing moderation and much-needed dullness to the worst fiscal crisis in Britain's peacetime history. In James's political column last week he suggested that Darling calls his autobiography "the forces of hell" - that he would defy Brown like that takes some guts. It felt strange to praise Darling in the editorial of tomorrow's magazine, given that he has presided over this fiscal collapse.

Patrick Nolan

This budget penalises employment

From our UK edition

Supporting jobs and small businesses - "the backbone of future economic growth", in Alistair Darling's words - was seen as a priority in today's Budget. In his statement the Chancellor highlighted the following measures: •         Extending the young person's guarantee for one year after March 2011 (providing a job, training or work experience for young people who cannot find work). •         Extending the time to pay scheme, which allows businesses to spread tax payments over a timetable they can afford, for the whole of the next Parliament. •         Cutting the business rates facing small businesses for one year from October.

James Forsyth

Another dangerous Quango in the offing

From our UK edition

This government’s love of quangos reached new heights in today’s Budget when Darling announced the creation of a ‘credit adjudicator service’. This will allow companies who feel they have been unfairly denied credit by their bank to appeal the decision to the credit adjudicator service which will have the legal power to order the bank to lend the money.    The Treasury is quick to stress that businesses will have to have claims referred to the credit adjudicator service by their regional business body. But this quango, which will cost five million pounds a year to run, strikes me as a quite absurd attempt to second guess commercial lending decisions. It is also unaccountable.

Fraser Nelson

A reassuringly dull budget

From our UK edition

This was a surprisingly subdued Budget, and for that Alistair Darling is to be commended. He must have resisted all manner of pressure from Brown to put in pre-election pyrotechnics. But the budget was what it should be: a punctuation mark on the sentence of the national economy. That sentence says "our finances are going to hell," and the Budget's high point is that we are doing so fractionally slower than we were expecting to last November. Personally, I forgive Darling all the partisan stuff in his speech - this is a pre-election Budget after all. There is no act of wanton vandalism, like the 50p tax. Stamp duty on properties over 1m is rising from 4 percent to 5 percent, but does anyone seriously think this would not have happened under the Tories?

Peter Hoskin

Darling’s phoney Budget doesn’t change anything

From our UK edition

Was that a Budget sufficient to the fiscal nightmare that we face?  Well, I think we all could have answered that question before Alistair Darling stood up at the dispatch box, but now we can at least be sure: no, it wasn't.  The government's overall spending plans remain roughly the same as they were in the PBR, there aren't many tax increases to raise much money for the Treasury, and we're meant to be all excited that borrowing is £11bn lower this year than previously forecast – at £167bn.  It's a shame that Darling increased alcohol duty, or we'd all be be out celebrating that particular success, I'm sure. If you're feeling charitable to the government, you could say that if might have been worse.

Peter Hoskin

All quiet on the Westminster front

From our UK edition

If there's one thing distinguishing this morning, then it's just how placid everything feels.  The clouds are moving sluggishly across the sky; there's little excitement about the measures expected in the Budget; and there are no stories about rifts between the Prime Minister and the Chancellor.  Indeed, Downing St insiders tell the FT that relations between Gordon Brown and Alistair Darling have been "pretty good" in the run up to the Budget, because both are "broadly agreed on the strategy of halving the deficit in four years while backing growth initiatives." Many are taking this as a sign that Darling and Peter Mandelson have won out in their efforts to coax Brown away from the crude "investment vs cuts" thinking of yesteryear.

Tuesday

Martin Bright

Does America Point to a Future for the British Left?

From our UK edition

I have had the pleasure of meeting two major figures of the American intellectual left over the past two weeks: Washington Post columnist EJ Dionne and Michael Kazin, co-editor of Dissent magazine. I'm sure there are as many differences as similarities in the politics of these two men, but what struck me about meeting them was how complacent and flabby we have become in Britain with our progressive politics. The relative strength of the Labour Party and the trade unions make us believe our radical traditions are safe here. But last night's Dispatches made me realise just how fragile a principled left-wing politics has become.  It is as well not to get over-romantic about other intellectual cultures.

Peter Hoskin

Darling’s Budget preview emphasises private sector-driven growth

From our UK edition

Exactly what you want at the end of the working day: Alistair Darling's video preview of the Budget.  I've watched it so that you don't have to, and it's striking just how much emphasis the Chancellor places on "unlocking private sector investment" to "ensure growth".  There's probably nothing in it, but it does make you wonder whether Labour have some secret business tax cut ready to spring tomorrow.  And, if so, how that sqaures with increasing the rates of tax on workers.