Alistair Darling, not a man given to hyperbole, is on top form defending his economic legacy and attacking what he sees as ideological cuts from the Tory-led coalition. He has been a regular on the airwaves at a time when Labour lacks leadership. And this passionate piece in the Observer was a model Keynesian take-down of the government’s fiscal plans.
Now, following Ed Miliband’s description of Nick Clegg as a “crypto-Tory”, Darling has accused the Lib Dems of acting as a “human shield” covering the Tories’ controversial programme of cuts.
Darling writes in today’s London Evening Standard:
When George Osborne says the UK is “on the road to ruin” he is trashing this country’s reputation to justify the cuts and tax rises he’s always wanted.
He talks a lot about tax rises and cuts. He never has much to say about growth. So the test of the Budget will be whether his plans ensure growth. And crucially, if it is fair.
Britain is slowly emerging from recession. Europe, our biggest trading partner, is struggling to maintain growth with many countries in recession or not far off it. Our economy is this year largely being supported by government spending, as the independent Office for Budget Responsibility has said. We cannot afford to do anything to undermine that growth. Indeed, we should be supporting it.
Borrowing has risen because tax revenues fell when the financial crisis hit in 2008. We and every other developed country did the same: we used public spending to stop our economy tipping from recession into depression. It worked.
Remember, the Tories supported our spending plans right up to 2008.
Of course, borrowing has to come down as our economy recovers. That is why I wanted to cut it by half over a four-year period. It would have been tough but I wanted to avoid damaging our economy whilst it was still in a fragile state.
The Tories have painted an apocalyptic picture of public finances and claim high borrowing is to be found here and nowhere else. That, as they know, is nonsense. They are using this as an excuse to do what they have always wanted to do — have a real go at the public sector.
It is essential that we maintain growth. Without it, the deficit will never come down, as we have seen in Japan.
The Tories often quote Canada. The truth is the Canadians got their borrowing down on the back of a growing US economy. And it is nonsense, too, to suggest that if you cut public spending the private sector will take its place automatically.
And remember the Lib Dems’ “VAT bombshell”? Judging by the last few weeks, they will be voting for a Tory Budget and acting as their human shield.
Darling is setting the tone for the new opposition. As Alastair Campbell has said, it is time for the Labour leadership candidates to follow suit.
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