Clegg’s contradictions

The Liberal Democrats need to sort out their line of attack on Labour’s “deficit deniers”.

One of the (many) downsides to the Liberal Democrats being in coalition with the Conservatives, and Lib Dem press officers like Lena Pietsch having to serve under Tory spinners like Andy "Bully" Coulson, is that the Lib Dems have had their talking points written for them, word for word, by their Conservative coalition partners.

Take the deficit. I've blogged before about Clegg and Cable's humiliating and inexplicable U-turn on the issue of spending cuts and the timing of deficit reduction, but have you noticed how Tory-esque their attacks on Labour's economic policies seem to have become in recent weeks? The whole Osbornian "deficit denier" stuff has been swallowed wholesale by the Lib Dem front bench.

Last month, in a joint press conference with the Tory party chair, Sayeeda Warsi, the Energy Secretary, Chris Huhne, said it was "inexcusable" that none of the Labour leadership contenders had come up with any policies to tackle the record Budget deficit. And on Sunday, Danny Alexander wrote to the Labour leadership candidates, accusing them of "opportunism rather than economic competence".

And in yesterday's PMQs, stand-in Nick Clegg, the deputy PM, told the Tory MP Mark Pritchard::

They [Labour] were irresponsible in government, and they are now living in denial in opposition.

He told the Labour MP Nic Dakin:

One hundred thousand members of the public have made suggestions about how we can try to bring some sense to our public finances without hitting the vulnerable and without hitting front-line public services. Have we heard a single suggestion from anyone on the opposition benches? Not a single suggestion.

But, in the same session of PMQs, he said to the Labour MP Joan Walley:

I simply ask the Honourable Lady and her colleagues whether they have any qualms about the fact that her party and her government announced £44bn-worth of cuts but never had the decency or honesty to tell the British people where those cuts would fall.

Hang on! He accepts that Labour had planned "£44bn-worth of cuts", but accuses Labour leadership contenders -- including David Miliband, who is sticking to the Brown/Darling deficit reduction plan -- of being in "denial". Contradiction?

And he tells Dakin (above) that we have not "heard a single suggestion from anyone on the opposition benches" about how to fix the public finances, despite being well aware of the various proposals that have emerged from the five leadership candidates during the course of the campaign.

Take David Miliband, for example, who wants to abolish charitable status for private schools and introduce a mansion tax.

Take Ed Miliband, who wants to retain the bankers' bonus tax.

Take Ed Balls, who wants to introduce a 50p tax rate on those earning more than £100,000.

Take Andy Burnham, who wants to end the ring-fencing of the NHS budget.

Take Diane Abbott, who wants to scrap Trident (something the Deputy PM once wanted to do!).

Now, I accept that most of these proposals have yet to be fleshed out in detail, and none of them on their own (or, for that matter, combined) will eliminate or even halve the structural deficit, but to pretend that we've had nothing but silence from in-denial Labour leadership candidates is simply untrue and absurd.

It also, as I said, flatly contradicts his other line of defence -- Labour planned cuts, too! -- which he deployed against Joan Walley yesterday, and again on the Today programme this morning against John Humphrys.

Get your story straight, Nick!

UPDATE:

I hear Danny Alexander refused to appear on Newsnight yesterday to debate Ed Balls. The shadow schools secretary has, of course, been praised for his grasp of economics and fiscal policy by, among others, centre-right figures such as Irwin Stelzer, Martin Wolf and Boris Johnson (!).

Check out Balls's reply to Alexander's letter to the candidates here.

You can read Mehdi Hasan's politics column each week in the New Statesman magazine.

Mehdi Hasan is a contributing writer for the New Statesman and the co-author of Ed: The Milibands and the Making of a Labour Leader. He was the New Statesman's senior editor (politics) from 2009-12.

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Scotland's vast deficit remains an obstacle to independence

Though the country's financial position has improved, independence would still risk severe austerity. 

For the SNP, the annual Scottish public spending figures bring good and bad news. The good news, such as it is, is that Scotland's deficit fell by £1.3bn in 2016/17. The bad news is that it remains £13.3bn or 8.3 per cent of GDP – three times the UK figure of 2.4 per cent (£46.2bn) and vastly higher than the white paper's worst case scenario of £5.5bn. 

These figures, it's important to note, include Scotland's geographic share of North Sea oil and gas revenue. The "oil bonus" that the SNP once boasted of has withered since the collapse in commodity prices. Though revenue rose from £56m the previous year to £208m, this remains a fraction of the £8bn recorded in 2011/12. Total public sector revenue was £312 per person below the UK average, while expenditure was £1,437 higher. Though the SNP is playing down the figures as "a snapshot", the white paper unambiguously stated: "GERS [Government Expenditure and Revenue Scotland] is the authoritative publication on Scotland’s public finances". 

As before, Nicola Sturgeon has warned of the threat posed by Brexit to the Scottish economy. But the country's black hole means the risks of independence remain immense. As a new state, Scotland would be forced to pay a premium on its debt, resulting in an even greater fiscal gap. Were it to use the pound without permission, with no independent central bank and no lender of last resort, borrowing costs would rise still further. To offset a Greek-style crisis, Scotland would be forced to impose dramatic austerity. 

Sturgeon is undoubtedly right to warn of the risks of Brexit (particularly of the "hard" variety). But for a large number of Scots, this is merely cause to avoid the added turmoil of independence. Though eventual EU membership would benefit Scotland, its UK trade is worth four times as much as that with Europe. 

Of course, for a true nationalist, economics is irrelevant. Independence is a good in itself and sovereignty always trumps prosperity (a point on which Scottish nationalists align with English Brexiteers). But if Scotland is to ever depart the UK, the SNP will need to win over pragmatists, too. In that quest, Scotland's deficit remains a vast obstacle. 

George Eaton is political editor of the New Statesman.