Moody's downgrade might be symbolic - but it's still correct

What does it mean, if anything?

Moody’s downgrade of Britain’s credit rating, from AAA to AA1, is largely symbolic, akin to a sticking plaster falling off a major unhealed gash. It will have no effect on the cost of borrowing, so what does it mean, if anything?

First, it was an anomaly that America and France had been downgraded months ago, and that little bankrupt Britain could sail on merrily, as if the only boat in the race without a leak, was plainly ludicrous.

Second, the fact is that there is a major hole below the waterline in the nation’s finances that isn’t being fixed. But compare 600,000 new jobs being created in the last year by the private sector, of which half are full-time: either the figures are wrong, or thousands of jobs have been lost at the same time, by bankrupt retailers and lost manufacturing output.

Third, sterling was on the slide in the FX markets before Moody’s even blew their faint-hearted whistle. This was after Mervyn King of the BoE voted for more QE, despite the fact that he is already sitting atop one-third of the national debt, and could easily topple off this pile of irredeemable IOUs.

Fourth, the national debt, which was meant to be coming down, is now going back up again. Osborne’s cuts were too little, and now are seen to be too late. But the Cameroons are such a lot of new-drippy Old Etonians that they are increasingly seen as a generation that hasn’t got the balls to pick up a sharp axe and really wield it. No pain, no gain.

As a result of reasons one to four, number five is that the economy is going nowhere fast except down a big, black hole called the IMF. Sort it Osborne, or quit! The answer is simple: slash government expenditure and taxation on March 20, not in some mealy-mouthed way as you are currently posturing, but in a determined and dramatic way.

Slash the Gordian knot of ever-advancing EU-driven socialist-bureaucracy! Cut the chain that is holding back the UK private sector, the people who have had proper jobs all their lives! Unlike you miserable lot in government, who have never had a proper productive job at all.

After all, the only man in Britain who is going to say you are wrong to do such a thing, is the utterly stupid, pathetic and ludicrous Ed Balls. And he is the one who assiduously dug the nation over many years into this great hole in the first place! But then, I suppose, he has never had a proper job either - a kindred spirit, perhaps?

This first appeared on Spear's.

Photograph: Getty Images

Stephen Hill writes for Spear's

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Emily Thornberry heckled by Labour MPs as tensions over Trident erupt

Shadow defence secretary's performance at PLP meeting described as "risible" and "cringeworthy". 

"There's no point trying to shout me down" shadow defence secretary Emily Thornberry declared midway through tonight's Parliamentary Labour Party meeting. Even by recent standards, the 70-minute gathering was remarkably fractious (with PLP chair John Cryer at one point threatening to halt it). Addressing MPs and peers for the first time since replacing Maria Eagle, Thornberry's performance did nothing to reassure Trident supporters. 

The Islington South MP, who voted against renewal in 2007, said that the defence review would be "wide-ranging" and did not take a position on the nuclear question (though she emphasised it was right to "question" renewal). She vowed to listen to colleagues as well as taking "expert advice" and promised to soon visit the Barrow construction site. But MPs' anger was remorseless. Former shadow defence minister Kevan Jones was one of the first to emerge from Committee Room 14. "Waffly and incoherent, cringeworthy" was his verdict. Another Labour MP told me: "Risible. Appalling. She compared Trident to patrolling the skies with spitfires ... It was embarrassing." A party source said afterwards that Thornberry's "spitfire" remark was merely an observation on changing technology. 

"She was talking originally in that whole section about drones. She'd been talking to some people about drones and it was apparent that it was absolutely possible, with improving technology, that large submarines could easily be tracked, detected and attacked by drones. She said it is a question of keeping your eye on new technology ... We don't have the spitfires of the 21st century but we do have some quite old planes, Tornadoes, but they've been updated with modern technology and modern weaponry." 

Former first sea lord and security minister Alan West complained, however, that she had failed to understand how nuclear submarines worked. "Physics, basic physics!" he cried as he left. Asked how the meeting went, Neil Kinnock, who as leader reversed Labour's unilateralist position in 1989, simply let out a belly laugh. Thornberry herself stoically insisted that it went "alright". But a shadow minister told me: "Emily just evidently hadn't put in the work required to be able to credibly address the PLP - totally humiliated. Not by the noise of the hecklers but by the silence of any defenders, no one speaking up for her." 

Labour has long awaited the Europe split currently unfolding among the Tories. But its divide on Trident is far worse. The majority of its MPs are opposed to unilateral disarmament and just seven of the shadow cabinet's 31 members share Jeremy Corbyn's position. While Labour MPs will be given a free vote when the Commons votes on Trident renewal later this year (a fait accompli), the real battle is to determine the party's manifesto stance. 

Thornberry will tomorrow address the shadow cabinet and, for the first time this year, Corbyn will attend the next PLP meeting on 22 February. Both will have to contend with a divide which appears unbridgeable. 

George Eaton is political editor of the New Statesman.