"Do Cameron and Osborne know what they're doing?"

That is the question voters will ask.

Jeremy Hunt is in trouble. The Culture Secretary’s statement in the House of Commons today has done nothing to dispel the impression that he allowed News Corp privileged insight into a process he was overseeing in a quasi-judicial capacity. A cache of emails released yesterday clearly indicates that, at least as viewed from the Murdoch side, Hunt was a collaborative partner in the process of ensuring smooth passage of the controversial bid to take 100% control of BSkyB. Hunt’s defence appears to be that such an impression is false and  derives from excitable embellishment by the emails’ author – News Corp’s European public affairs director Frederic Michel – encouraged by over-zealous briefing by Adam Smith, the minister’s own special adviser. Smith has resigned.

It is a flimsy line and a shabby one. The secretary of state is responsible for his advisor’s actions and it is simply not credible that so much information, briefings and encouragement were fed to Michel behind Hunt’s back. If the Spad behaved in a way that seemed to lubricate relations with News Corp it is because his boss instructed him to do so. That raises the question of what instructions Hunt had from his own boss – the Prime Minister.

Cameron will not want to lose Hunt. He is a loyal minister who has, until now, proved diligent and effective. Besides, any forced resignation carries a whiff of disorder and corruption. But, crucially, if Hunt goes, suspicious eyes turn automatically higher up the chain of command. We know that Cameron was close to James Murdoch and Rebekah Brooks. He found time in his busy schedule for Christmas lunches and Cotswolds rambles with the latter. If, as the emails strongly imply, the Culture Secretary saw facilitation of the BSkyB bid as part of his job description, it is reasonable to suppose he took that interpretation from Downing Street’s culture of wider Murdoch facilitation. Of course, Hunt’s case is egregious because he was supposed to be acting in a quasi-judicial role. The PM, meanwhile, is allowed to have friends in business and media and was not the one making the takeover decision. That, at least, would be Downing Street’s defence. Unless there is some evidence that Cameron instructed Hunt to satisfy News Corps’s appetites (and one has to presume he would never be so crass), the damage to Number 10 from this episode is limited.

There is damage nonetheless. Most people, I suspect, will not drill too deep into the exact nature of the government’s role in regulating the media, who was responsible for what, when and whether or not specific communications were therefore improper. Labour should be wary of getting too excited about an issue that is essentially retrospective – the BSkyB bid is dead, the Leveson inquiry has been established and will report in due course. Cameron is unlikely to be seen riding a News of the World-branded police horse down Whitehall any time soon.

The most problematic part of the whole business for Downing Street is the way it reinforces the impression that the government serves rich and powerful clients before attending to the interests of ordinary citizens.  This is rapidly becoming a theme in criticism of Cameron, from the “kitchen suppers” for donors to the Budget tax breaks for high earners.

Today’s grim economic news – the confirmation of a double-dip recession - will feed a wider sense of drift that is shaking people’s confidence in the government. When challenged on the growth crisis in parliament, Cameron fell back on the familiar refrain that the difficulty in getting the economy back on track is simply an expression of the scale of the mess bequeathed by Labour. The political returns from that line are diminishing fast. The economy was expanding when Cameron entered Downing Street; now it is shrinking. How is that not at least to some extent a consequence of his policies? And what is the plan to restart growth? He says borrowing more is not the answer, but as many of his Conservative critics point out, borrowing more is precisely what he and George Osborne are being forced to do.

Those economic problems dwarf the local crisis enveloping the Department for Culture, Media and Sport. They are connected in one crucial respect. Double-dip recession will provoke in many people’s minds the question of whether Cameron and Osborne know what they are doing. The reminder of cosy collaboration with billionaire media moguls provokes the question of whose side they are really on. The combination of those doubts in the public mind could be electorally ruinous.

David Cameron and George Osborne. Photograph: Getty Images.

Rafael Behr is political columnist at the Guardian and former political editor of the New Statesman

How Jim Murphy's mistake cost Labour - and helped make Ruth Davidson

Scottish Labour's former leader's great mistake was to run away from Labour's Scottish referendum, not on it.

The strange revival of Conservative Scotland? Another poll from north of the border, this time from the Times and YouGov, shows the Tories experiencing a revival in Scotland, up to 28 per cent of the vote, enough to net seven extra seats from the SNP.

Adding to the Nationalists’ misery, according to the same poll, they would lose East Dunbartonshire to the Liberal Democrats, reducing their strength in the Commons to a still-formidable 47 seats.

It could be worse than the polls suggest, however. In the elections to the Scottish Parliament last year, parties which backed a No vote in the referendum did better in the first-past-the-post seats than the polls would have suggested – thanks to tactical voting by No voters, who backed whichever party had the best chance of beating the SNP.

The strategic insight of Ruth Davidson, the Conservative leader in Scotland, was to to recast her party as the loudest defender of the Union between Scotland and the rest of the United Kingdom. She has absorbed large chunks of that vote from the Liberal Democrats and Labour, but, paradoxically, at the Holyrood elections at least, the “Unionist coalition” she assembled helped those parties even though it cost the vote share.

The big thing to watch is not just where the parties of the Union make gains, but where they successfully form strong second-places against whoever the strongest pro-Union party is.

Davidson’s popularity and eye for a good photo opportunity – which came first is an interesting question – mean that the natural benefactor in most places will likely be the Tories.

But it could have been very different. The first politician to hit successfully upon the “last defender of the Union” routine was Ian Murray, the last Labour MP in Scotland, who squeezed both the  Liberal Democrat and Conservative vote in his seat of Edinburgh South.

His then-leader in Scotland, Jim Murphy, had a different idea. He fought the election in 2015 to the SNP’s left, with the slogan of “Whether you’re Yes, or No, the Tories have got to go”.  There were a couple of problems with that approach, as one  former staffer put it: “Firstly, the SNP weren’t going to put the Tories in, and everyone knew it. Secondly, no-one but us wanted to move on [from the referendum]”.

Then again under different leadership, this time under Kezia Dugdale, Scottish Labour once again fought a campaign explicitly to the left of the SNP, promising to increase taxation to blunt cuts devolved from Westminster, and an agnostic position on the referendum. Dugdale said she’d be open to voting to leave the United Kingdom if Britain left the European Union. Senior Scottish Labour figures flirted with the idea that the party might be neutral in a forthcoming election. Once again, the party tried to move on – but no-one else wanted to move on.

How different things might be if instead of running away from their referendum campaign, Jim Murphy had run towards it in 2015. 

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.

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