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The fatal contradiction at the heart of the Tory message: there is no money, except for people we like.

18 December 2014

4:55 PM

18 December 2014

4:55 PM

Next year’s general election looks like being the most gruesomely entertaining in years. Entertaining because no-one knows what is going to happen; gruesome because of the protagonists and the sorry misfortune that someone has to win it. All we can say for certain is that the Lib Dems will receive a doing.

I still don’t think that person will be David Cameron. In part for reasons previously detailed here. The single biggest thing preventing a thumping Labour victory is Ed Miliband. This is, it is true, a sturdy peg upon which the Tories may hang their hopes but it still may not prove sturdy enough.

Not least because, by the standards they set themselves, this government has failed. It came to power promising to put Britain’s finances in order. By any sensible measurement it has signally failed to do so. As Fraser put it the other day, the Prime Minster and his Chancellor are scurrying around the country misleading people. Never mind the national debt, the deficit has not been cut in half over the course of this parliament.

Indeed, functionally-speaking Cameron and Osborne’s record in power is much closer to the plans put forward by Gordon Brown and Alistair Darling in 2010 than to the promises the Tories offered the country themselves. In fiscal terms, you could argue this has been another Labour government.

But that’s far from the Tories’ greatest problem. If only it were! Broken promises are circles all governments must square after all and it’s the kind of thing the electorate kinda expects. No, much worse for the Tories is that far from completing the modernisation they once promised they have, in large part, abandoned the project. As a result the electorate, generally speaking, reckons the Tories just as extreme as Ukip. Moreover, voters think the Tories are some distance further from the centre of British politics than Labour. Perhaps that helps explain why no poll in the last two months has put the Tories above 34% of the vote.


So that’s all pretty bad. But it’s not nearly as bad as the fact the Tories are entering the campaign with a message that contradicts itself. Not at the margin or in some trivial sense but at the heart of the matter and on the stuff that really matters.

Because, you see, the Conservatives are running a campaign that says there is no money for public spending but there is money for tax cuts. One of these things can be true; they cannot both be.

The income tax cut for millionaires was a terrible idea when it was first announced and remains, politically-speaking, a terrible idea now. If anything, in fact, it looks worse now than it did at the time. Tax cuts for our chums; welfare cuts for you. That’s not a good look.

Now, however, Osborne promises huge public spending cuts of a depth and severity unseen in this parliament. The future, he smirks, is going to be pretty bloody bloody. It will hurt but it will be good for you.

Well, perhaps it will be. It may well be that further retrenchment is necessary, even if the private-sector economy grows more quickly than current predictions suggest. We can’t spend forever.

But if that is the case then we can’t afford tax cuts either. Especially tax cuts that won’t achieve their stated objectives. Once upon a time, Osborne disliked unfunded tax cuts; now he seems to be in favour of them.

Consider his Stamp Duty reforms, for instance. This is predicted to cost the government £800m a year. Not, it is true, the greatest lollipop in the history of pre-election giveaways but still, you know, a giveaway. Which, at a time of severe fiscal tightening, seems unnecessary and not least because it won’t actually do anything to make houses more affordable. No-one will save any money because a reduction in stamp duty payable will be offset by an increase in house prices. Good news for sellers, for sure, but there’s hee-haw in this for buyers.

It may be that voters don’t mind paying more for their house if it means the tax burden of purchasing a property is reduced and so there could, granted, be a political upside to this plan. But even if there is, that political benefit is more than offset by the manner in which Osborne’s Autumn Statement undermined the core thesis upon which the Tories are supposed to be making their pitch to the electorate.

Which is, again, that there is no money. Except, it seems, when there is. So which is it? At best the Tory message is We failed first time around but please give us another go. Voters, however, are entitled to wonder why, if there really is no money, the government can afford to cut government revenues. It’s not an easy message to sell, not least because it’s a message that contradicts itself. And those messages tend to be the kinds of message that lose elections.

Perhaps the electorate won’t notice. Perhaps they will conclude that, rubbish as the Tories have been, Prime Minister Miliband would be even worse. That’s a pretty risky bet, mind you.


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