Who has the most over-inflated reputation in British politics? Theresa May’s air of calculating caution is long gone, no one has believed in Boris Johnson’s connection with ordinary voters for a while, and if anyone still thinks the dwindling tribe of hardcore Blairites blathering on about the radical centre know anything about what is going on they are keeping themselves well-hidden. But for some strange reason, Sir Vince Cable’s reputation for being able to read the economy with lethal accuracy remains intact.
To much of the media, he remains the ‘man who saw the crash coming’. As the so-called Sage of Twickenham becomes leader of the Liberal Democrats later today, we will no doubt hear a great deal more about it. And as Brexit unfolds, he will no doubt be wheeled out to warn us constantly of damage being done to the pound, jobs, and prices if we aren’t in the Single Market or the Customs Union, or whatever version of EU-lite is being peddled that particular day.
There is a problem however. Although St Vince is very good at proclaiming his ability to foresee economic trouble ahead, there is not much actual evidence of it. Did he specifically predict the sub-prime crisis that started in the United States in 2009-09? True, he needled Gordon Brown a bit about soaring house prices and consumer debt in the run up to the crash. But then so did everyone from the Governor of the Bank of England downwards. And yet, for all the pious talk, there is no serious evidence to suggest it was a house price bubble which led to the collapse (a hint for people who don’t follow these thing closely – house prices never crashed). Nor was excessive consumer debt the problem – it wasn’t people ripping up their credit card statements that caused the banks to collapse. On some of the real causes of the 2008 collapse, such as Brown’s disastrous decision to take financial regulation away from the Bank of England, or the bonkers way Royal Bank of Scotland was allowed to expand, he was strangely silent.
Once in power as business secretary in the Coalition, he was forever coming up with fiddly, politically correct initiatives to improve diversity in the boardroom, or to create greener companies. But he didn’t seem to get around to fixing any of the things he argued had caused the problem the last time around. Debt? House prices? They carried on climbing. But from his perch in the Cabinet, St Vince didn’t seem that bothered any more. Funny that. Meanwhile, there was no fresh thinking on how to improve the economy. What there was actually came from George Osborne’s Treasury.
Right now, along with most die-hard Remainers, he has taken to constantly warning of financial catastrophe as we leave the EU. Apparently that’s going to be worse than 2008. Well, perhaps. There is precious little sign of it so far, however. No doubt those warnings will become ever more hysterical – and ever more wide of the mark.
In fact, Vince Cable is mainly just a re-heated 1960’s social democrat. He is a big state, tax-and-spend interventionist, who would rather oddly like to turn Britain into France circa 1970, with lots of hi-tech manufacturing, government-industrial partnerships, worker consultation and so on. But will he have anything useful to say about how the UK re-invents its economy as it leaves the EU? Or how a post-industrial, gig-based country should thrive in the 2020s. It seems unlikely. In truth, he hasn’t had anything interesting to say about the economy for years – if he ever had.