The Tories are good at politics but hopeless at economics

It's the Conservatives' plans for immediate spending cuts that would stamp on the recovery.

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Here is the Tories' latest poster, which rather brings to mind George Orwell's vision of the future as being "a boot stamping on a human face -- for ever". It is undoubtedly the party's most effective poster yet, and looks just about spoof-proof to me.

With a day to go until Gordon Brown calls the election, the political momentum is clearly with the Conservatives. But while the Tories are getting better at politics (that National Insurance pledge has helped them in the polls), they remain hopeless at economics.

Had they been in power at the time of the financial crisis, it is almost certain that Britain would still be in recession. Their opposition to fiscal stimulus and their support for early spending cuts would have prevented even the modest growth we've seen.

The 0.4 per cent growth in the final quarter of 2009 (up from a previous estimate of 0.1 per cent) was largely thanks to higher public spending and the car scrappage scheme.

The irony of the new poster is that, as our own David Blanchflower has persistently warned, it is the Tories' plans for immediate spending cuts that would choke the recovery and trigger a double-dip recession.

Meanwhile, David Cameron continues to claim that he can simultaneously cut taxes, cut the Budget deficit and protect front-line public services.

The limits of this approach were exposed today by the King's Fund, which accused George Osborne of indulging in a "sleight of hand" by promising to use the money the National Health Service would save from a cut in NI to fund £200m worth of new cancer drugs.

Professor John Appleby, chief economist at the fund, said: "It's a sleight of hand to say the least, because the money isn't there to be saved yet, so the money will have to come out of existing budgets."

There's plenty for Labour to get its teeth into here. But it needs to find a way to communicate the contradictions of the Tory approach to the electorate -- and soon.

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George Eaton is political editor of the New Statesman.

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How Theresa May laid a trap for herself on the immigration target

When Home Secretary, she insisted on keeping foreign students in the figures – causing a headache for herself today.

When Home Secretary, Theresa May insisted that foreign students should continue to be counted in the overall immigration figures. Some cabinet colleagues, including then Business Secretary Vince Cable and Chancellor George Osborne wanted to reverse this. It was economically illiterate. Current ministers, like the Foreign Secretary Boris Johnson, Chancellor Philip Hammond and Home Secretary Amber Rudd, also want foreign students exempted from the total.

David Cameron’s government aimed to cut immigration figures – including overseas students in that aim meant trying to limit one of the UK’s crucial financial resources. They are worth £25bn to the UK economy, and their fees make up 14 per cent of total university income. And the impact is not just financial – welcoming foreign students is diplomatically and culturally key to Britain’s reputation and its relationship with the rest of the world too. Even more important now Brexit is on its way.

But they stayed in the figures – a situation that, along with counterproductive visa restrictions also introduced by May’s old department, put a lot of foreign students off studying here. For example, there has been a 44 per cent decrease in the number of Indian students coming to Britain to study in the last five years.

Now May’s stubbornness on the migration figures appears to have caught up with her. The Times has revealed that the Prime Minister is ready to “soften her longstanding opposition to taking foreign students out of immigration totals”. It reports that she will offer to change the way the numbers are calculated.

Why the u-turn? No 10 says the concession is to ensure the Higher and Research Bill, key university legislation, can pass due to a Lords amendment urging the government not to count students as “long-term migrants” for “public policy purposes”.

But it will also be a factor in May’s manifesto pledge (and continuation of Cameron’s promise) to cut immigration to the “tens of thousands”. Until today, ministers had been unclear about whether this would be in the manifesto.

Now her u-turn on student figures is being seized upon by opposition parties as “massaging” the migration figures to meet her target. An accusation for which May only has herself, and her steadfast politicising of immigration, to blame.

Anoosh Chakelian is senior writer at the New Statesman.

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