Will this be Osborne's worst week yet?

A higher deficit and a triple-dip recession could make this week even worse for the Chancellor than the last one.

Even by recent standards, last week was not a good one for George Osborne. Unemployment was found to have increased by 70,000, the IMF's chief economist warned that he was "playing with fire" by persisting with austerity, Carman Reinhart and Kenneth Rogoff, two of the economists that the Chancellor leant heavily on to justify his economic approach, had their research on debt and growth discredited, and Fitch became the second credit rating agency to strip the UK of its AAA rating

But worse could be to come this week. Tomorrow, borrowing figures for March will be released, the final set for the 2012-13 financial year, and, for the first time since Osborne entered office, they could show that the deficit has risen in annual terms. At the Budget, the OBR forecast that borrowing would be £120.9bn in 2012-13, £100m less than in 2011-12, after the Treasury forced government departments to underspend by an extraordinary £10.9bn in the final months of this year and delayed payments to some international institutions such as the UN and the World Bank. But that £100m difference leaves the Chancellor with little room for error if tax revenues fall short or spending is higher than expected. Whether the deficit marginally rose or fell in 2012-13 is of little economic significance, but it is of immense political significance. Until now, even as growth has disappeared, the Chancellor has been able to boast that borrowing "is falling" and "will continue to fall each and every year". A higher deficit would make it far harder for him to claim that Britain is "on the right track".

Then, two days later, we will learn whether the UK has suffered its first-ever triple-dip recession when the ONS releases its estimate for GDP in Q1 of this year. Again, the Chancellor is expected to have a lucky escape, with most forecasters, in common with the OBR, predicting output of around 0.1 per cent. But that also leaves Osborne with little room for comfort if growth undershoots expectations (as it done so often has in recent history). IPPR's senior economist Tony Dolphin comments: "It is touch and go whether we triple dip, I would say 50/50. Retail sales were up a fraction in March, but manufacturing is expected to be flat and ­construction down. Services will be positive, but the question is whether it will be positive enough to offset construction." Again, whether output slightly grew or slightly shrank in the first quarter is of little economic signifinance. The broad picture is one of prolonged stagnation, with periods of growth alternating with periods of contraction. But as Osborne will know, it's the politics that matter. An unprecedented triple-dip would intensify the calls from all sides - Tory backbenchers, Vince Cable, Labour - for a change of approach, be it Keynesian stimulus or a supply-side revolution. 

There is one way that Osborne could avoid a triple-dip even if the economy is found to have shrunk in Q1: the preceding double-dip could be revised away. After previously estimating that output fell by 0.3 per cent in the final quarter of 2011, the ONS now says it fell by just 0.1 per cent. The number could be further upgraded this week. But such technicalities will count for little if the economy is reported to have shrunk again. 

Tory MPs previously suggested that they would demand the removal of Osborne if the economy failed to show signs of recovery by this time, with one telling the Daily Mail: "You wouldn’t get 80 people supporting Adam Afriyie for leader but you might get 80 or 100 people saying get rid of George." There is little prospect of Cameron acquiescing to such demands. The Prime Minister and his closest political ally continue to rise and fall together. But with the local elections just over a week away and Labour showing signs of strain, a renewed bout of Tory infighting would be unwelcome for Cameron. 

Chancellor of the Exchequer George Osborne attends a press conference at the Treasury in Whitehall on February 6, 2013. Photograph: Getty Images.

George Eaton is political editor of the New Statesman.

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How Donald Trump is slouching towards the Republican nomination

There was supposed to be a ceiling above which Trump’s popular support could not climb.

In America, you can judge a crowd by its merchandise. Outside the Connecticut Convention Centre in Hartford, frail old men and brawny moms are selling “your Trump 45 football jerseys”, “your hats”, “your campaign buttons”. But the hottest item is a T-shirt bearing the slogan “Hillary sucks . . . but not like Monica!” and, on the back: “Trump that bitch!” Inside, beyond the checkpoint manned by the Transportation Security Administration and the secret service (“Good!” the man next to me says, when he sees the agents), is a family whose three kids, two of them girls, are wearing the Monica shirt.

Other people are content with the shirts they arrived in (“Waterboarding – baptising terrorists with freedom” and “If you don’t BLEED red, white and blue, take your bitch ass home!”). There are 80 chairs penned off for the elderly but everyone else is standing: guys in motorcycle and military gear, their arms folded; aspiring deal-makers, suited, on cellphones; giggling high-school fatsos, dressed fresh from the couch, grabbing M&M’s and Doritos from the movie-theatre-style concession stands. So many baseball hats; deep, bellicose chants of “Build the wall!” and “USA!”. (And, to the same rhythm, “Don-ald J!”)

A grizzled man in camouflage pants and combat boots, whose T-shirt – “Connecticut Militia III%” – confirms him as a member of the “patriot” movement, is talking to a zealous young girl in a short skirt, who came in dancing to “Uptown Girl”.

“Yeah, we were there for Operation American Spring,” he says. “Louis Farrakhan’s rally of hate . . .”

“And you’re a veteran?” she asks. “Thank you so much!”

Three hours will pass. A retired US marine will take the rostrum to growl, “God bless America – hoo-rah!”; “Uptown Girl” will play many more times (much like his speeches, Donald J’s playlist consists of a few items, repeated endlessly), before Trump finally looms in and asks the crowd: “Is this the greatest place on Earth?”

There was supposed to be a ceiling above which Trump’s popular support could not climb. Only a minority within a minority of Americans, it was assumed, could possibly be stupid enough to think a Trump presidency was a good idea. He won New Hampshire and South Carolina with over 30 per cent of the Republican vote, then took almost 46 per cent in Nevada. When he cleaned up on Super Tuesday in March, he was just shy of 50 per cent in Massachusetts; a week later, he took 47 per cent of the votes in Mississippi.

His rivals, who are useless individually, were meant to co-operate with each other and the national party to deny him the nomination. But Trump won four out of the five key states being contested on “Super-Duper Tuesday” on 15 March. Then, as talk turned to persuading and co-opting his delegates behind the scenes, Trump won New York with 60 per cent.

Now, the campaign is trying to present Trump as more “presidential”. According to his new manager, Paul Manafort, this requires him to appear in “more formal settings” – without, of course, diluting “the unique magic of Trump”. But whether or not he can resist denouncing the GOP and the “corrupt” primary system, and alluding to violence if he is baulked at at the convention, the new Trump will be much the same as the old.

Back in Hartford: “The Republicans wanna play cute with us, right? If I don’t make it, you’re gonna have millions of people that don’t vote for a Republican. They’re not gonna vote at all,” says Trump. “Hopefully that’s all, OK? Hopefully that’s all, but they’re very, very angry.”

This anger, which can supposedly be turned on anyone who gets in the way, has mainly been vented, so far, on the protesters who disrupt Trump’s rallies. “We’re not gonna be the dummies that lose all of our jobs now. We’re gonna be the smart ones. Oh, do you have one over there? There’s one of the dummies . . .”

There is a frenzied fluttering of Trump placards, off to his right. “Get ’em out! . . . Don’t hurt ’em – see how nice I am? . . . They really impede freedom of speech and it’s a disgrace. But the good news is, folks, it won’t be long. We’re just not taking it and it won’t be long.”

It is their removal by police, at Trump’s ostentatious behest, that causes the disruption, rather than the scarcely audible protesters. He seems to realise this, suddenly: “We should just let ’em . . . I’ll talk right over them, there’s no problem!” But it’s impossible to leave the protesters where they are, because it would not be safe. His crowd is too vicious.

Exit Trump, after exactly half an hour, inclusive of the many interruptions. His people seem uplifted but, out on the street, they are ambushed by a large counter-demonstration, with a booming drum and warlike banners and standards (“Black Lives Matter”; an image of the Virgin of Guadalupe, holding aloft Trump’s severed head). Here is the rest of the world, the real American world: young people, beautiful people, more female than male, every shade of skin colour. “F*** Donald Trump!” they chant.

After a horrified split-second, the Trump crowd, massively more numerous, rallies with “USA!” and – perplexingly, since one of the main themes of the speech it has just heard was the lack of jobs in Connecticut – “Get a job!” The two sides then mingle, unobstructed by police. Slanging matches break out that seem in every instance to humiliate the Trump supporter. “Go to college!” one demands. “Man, I am in college, I’m doin’ lovely!”

There is no violence, only this: some black boys are dancing, with liquid moves, to the sound of the drum. Four young Trump guys counter by stripping to their waists and jouncing around madly, their skin greenish-yellow under the street lights, screaming about the building of the wall. There was no alcohol inside; they’re drunk on whatever it is – the elixir of fascism, the unique magic of Trump. It’s a hyper but not at all happy drunk.

As with every other moment of the Trump campaign so far, it would have been merely some grade of the cringeworthy – the embarrassing, the revolting, the pitiful – were Trump not slouching closer and closer, with each of these moments, to his nomination. 

This article first appeared in the 28 April 2016 issue of the New Statesman, The new fascism