A Tale of Two Elections

The Republican primaries make good spectator sport and are conveniently conducted in English. The ra

The British media are predictably mesmerised by the US Republican primary campaign and with good reason. It is a fiercely competitive race between colourful candidates. Newt Gingrich's victory in South Carolina puts pressure on Mitt Romney, the front-runner, to deliver a "knockout punch" in Florida.

As political spectator sport goes, this is end-to-end stuff. And, of course, it matters. The winning candidate will run against Barack Obama and so potentially emerge as President of the United States and Commander-in-Chief of what remains - until China catches up some time in the next decade or three - the most formidable power in the world. It is worth keeping an eye on who is in the frame for that job.

Still, the US vote that really counts isn't until November. Meanwhile, in our political backyard, campaigning is under way in another presidential poll - in France. The first round of voting is on 22 April. Francois Hollande wants to unseat Nicolas Sarkozy and take back the presidency for the Socialist party first time since 1996. On the fringe, Marine Le Pen, leader of the far right National Front, is hoping to repeat the success of her father, Jean-Marie, who stunned the European political establishment by elbowing his way into the second round presidential run-off against Sarkozy in 2002.

France's constitution gives the president extraordinary powers - far more than are wielded by the US head of state, whose hands are often tied by Congress. The country is absolutely central to the diplomacy that is currently going on around attempts to resolve the European single currency debt crisis and the negotiations over wider reforms to the European Union. It shouldn't have to be said that the outcome of a presidential election across the channel matters every bit as much to Britain - and arguably much more - than the outcome of a contest over the Atlantic.

You wouldn't have guessed it from the proportion of attention paid by our media. It is, of course, easier to follow US politics - the Americans conveniently do battle in our native language. But that point of access creates a false sense of cultural and political proximity. Britain's strategic alliance with Washington stays remarkably stable regardless of who is in the White House. It is a partnership built on defence and security collaboration.

By contrast, our economic fortunes could be quite substantially affected by the outcome of European negotiations, which, in turn, are substantially affected by diplomatic relations with the French head of state. The prospect of that job going to the Socialist candidate for the first time in 16 years (who, by the way, is campaigning on a populist anti-Big Finance ticket) merits perhaps more attention than it has thus far earned.

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

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How austere will Philip Hammond be?

The Chancellor must choose between softening or abandoning George Osborne's approach in his Autumn Statement. 

After becoming Chancellor, Philip Hammond was swift to confirm that George Osborne's budget surplus target would be abandoned. The move was hailed by some as the beginning of a new era of fiscal policy - but it was more modest than it appeared. Rather than a statement of principle, the abandonment of the 2019-20 target was merely an acceptance of reality. In the absence of additional spending cuts or tax rises, it would inevitably be missed (as Osborne himself recognised following the EU referendum). The decision did not represent, as some suggested, "the end of austerity".

Ahead of his first Autumn Statement on 23 November, the defining choice facing Hammond is whether to make a more radical break. As a new Resolution Foundation report notes, the Chancellor could either delay the surplus target (the conservative option) or embrace an alternative goal. Were he to seek a current budget suplus, rather than an overall one (as Labour pledged at the last general election), Hammond would avoid the need for further austerity and give himself up to £17bn of headroom. This would allow him to borrow for investment and to provide support for the "just managing" families (as Theresa May calls them) who will be squeezed by the continuing benefits freeze.

Alternatively, should Hammond merely delay Osborne's surplus target by a year (to 2020-21), he would be forced to impose an additional £9bn of tax rises or spending cuts. Were he to reject any further fiscal tightening, a surplus would not be achieved until 2023-24 - too late to be politically relevant. 

The most logical option, as the Resolution Foundation concludes, is for Hammond to target a current surplus. But since entering office, both he and May have emphasised their continuing commitment to fiscal conservatism ("He talks about austerity – I call it living within our means," the latter told Jeremy Corbyn at her first PMQs). For Hammond to abandon the goal of the UK's first budget surplus since 2001-02 would be a defining moment. 

George Eaton is political editor of the New Statesman.