George Osborne and the risky politics of chutzpah

The Chancellor is right that people don't demand ideological consistency but they do like politicians to believe in something.

The Chancellor’s position is clear enough. He doesn’t think it is the government’s job to meddle in markets except when he does. As my colleague George Eaton noted yesterday, George Osborne’s decision to cap payday loan charges sits in splendid contradiction with his objections to Ed Miliband’s proposal to freeze energy prices. When Labour wants to mandate lower prices, it’s Bolshevism; when Tories give in to the same impulse, it’s addressing the concerns of ordinary citizens.

The volte face has been greeted with scepticism across the political spectrum. Orthodox Thatcherites fear that the Chancellor is dabbling in anti-enterprise Milibandism, while Labour, cherishing a moment of intellectual vindication, are confident Osborne can never beat them in an arms race over the cost of living and responsible capitalism.

So, Left Populism 1 – 0 Market Fundamentalism? Not necessarily.

There isn’t anything particularly new about this ideological plasticity in the Chancellor. Help to Buy is a market intervention to buoy up house prices by stimulating demand with government guarantees. When Osborne’s deficit-reduction programme veered of course, he simply abandoned his targets. As I wrote earlier this year, the economy has been run to a plan A-minus (or B-plus) ever since the decision was made to let automatic fiscal stabilisers compensate for disappointing growth and to bring forward infrastructure spending to counteract the threat of perpetual stagnation. There is no doubt that Osborne’s economic instincts are deeply Conservative, but his political impulses are ruthlessly pragmatic. He would rather win an election by sacrificing a point of Thatcherite dogma here or there than gratify libertarian purists and lose. One of the Chancellor’s defining political traits is the embrace of chutzpah – that excellent Yiddish word to describe the bare-faced cheek of someone who combines offence with self-righteousness. (One way to understand chutzpah is to imagine a shoplifter taking his stolen item back to the store for a refund because it doesn’t work properly.)

Osborne’s lack of intellectual consistency naturally irritates the kind of people who admire doctrinal rigour. But does it really matter to anyone else? It matters to Labour, of course. That is partly because there is a habit of mind on the left that seeks an almost aesthetic gratification in theoretical coherence, but largely because exposing the Chancellor’s discreet capitulations to what Miliband has been saying all along strengthens the argument that he ought to be given a turn at running the country. A central part of the story that Miliband’s team wants to tell about his march on Downing Street is that he identified deep structural problems with the economy before anyone else and that the Tories, blinkered by their obsolete pro-market dogmas, are incapable of matching his perspicacity. (In this context, they like to recall that Osborne was accusing Labour of going back the 1970s when Gordon Brown intervened to rescue the entire banking system from collapse in 2008, so his antennae for what constitutes radical leftism are a bit warped.) In other words, Labour want the Chancellor’s economic flip-flops to be seen as much more than conventional flakiness. They want it to be a disqualification from holding the office he has at such a critical moment in the nation’s destiny.

It is far from clear that voters are ready to see it that way. For one thing, only the kind of people who use “wedded to the neo-liberal paradigm” as a term of abuse will readily understand the argument and they are almost certainly voting Labour already. Miliband may be making progress in highlighting the way that the economy isn’t adequately trickling wealth down to households who feel a financial squeeze but that doesn’t mean he has persuaded the country that a drastic change of direction – and a return to Labour rule – is the remedy.

The Chancellor’s supporters, meanwhile, remain confident that Britain is still a very capitalist society; that if you hold it up to the light you see the watermark of pro-enterprise, aspirational Thatcherism. In that context, even if voters do feel that something has gone awry with some dysfunctional markets, they’d rather have them repaired by bona fide capitalists than the people who lost all the arguments in the 1980s, never got over it and are just waiting for a chance to turn the clock back. Osborne’s calculation is surely that he can feint a bit to the left when it comes to regulating the likes of Wonga precisely because there is a bedrock of confidence in the Tories not to get carried away in that direction. The argument would be that Conservatives regulate reluctantly, when they have to, while Labour regulates indiscriminately because that’s all it knows.

The danger for Osborne is probably not that millions of people will be aghast at his failure to uphold the purity of liberal market theory, nor even that they think he is cynically chasing Miliband’s agenda. There isn’t much evidence that unyielding intellectualism is a quality that is supremely prized by voters in their politicians. It certainly isn’t one they expect. On the contrary, properly spun, a bit of flexibility in the face of the facts is potentially quite appealing. The problems only begin when flexibility is coupled with a pre-existing reputation for lacking principle. This is where the Tories are in danger.

Only last week, David Cameron was reported to be trash-talking environmental policy as “green crap.” Naturally that doesn’t go down well with the very small number of people for whom ecological rectitude is the greatest asset to be hoped for in a Prime Minister. But it also goes down badly with anyone who remembers that Cameron once professed to care very deeply about greenery, which is anyone who was even half-paying attention to politics in the period 2005-2008. The issue itself is secondary to the casual abandonment of the commitment.

Osborne’s u-turn over pay-day lenders is not as flagrant in most people’s eyes as the butchery of Cameron’s once hugged huskies. But it stems from the same brand of cynicism. I doubt many people will be dismayed because the Chancellor appears to have changed – or even betrayed – his old beliefs. It is a problem when, over time, it becomes impossible to suppose that the Chancellor or the Prime Minister really believe in anything very much at all.

George Osborne addresses the Mansion House dinner in London. Photograph: Getty Images.

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

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The Tory-DUP deal has left Scotland and Wales seething

It is quite something to threaten the Northern Irish peace process and set the various nations of the UK at loggerheads with merely one act.

Politics in the UK is rarely quite this crude, or this blatant. The deal agreed between the Conservatives and Northern Ireland's Democratic Unionist Party has – finally – been delivered. But both the deal and much of the opposition to it come with barely even the pretence of principled behaviour.

The Conservatives are looking to shore up their parliamentary and broader political position after a nightmare month. The DUP deal gives the Tories some parliamentary security, and some political breathing space. It is not yet clear what they as a party will do with this – whether, for instance, there will be an attempt to seek new leadership for the party now that the immediate parliamentary position has been secured.

But while some stability has been achieved, the deal does not provide the Tories with much additional strength. Indeed, the DUP deal emphasises their weakness. To finalise the agreement the government has had to throw money at Northern Ireland and align with a deeply socially conservative political force. At a stroke, the last of what remained of the entire Cameron project – the Conservative’s rebuilt reputation as the better party for the economy and fiscal stability, and their development as a much more socially inclusive and liberal party – has been thrown overboard.

Read more: Theresa May's magic money tree is growing in Northern Ireland

For the DUP, the reasoning behind the deal is as obvious as it is for the Conservatives. The DUP has maximised the leverage that the parliamentary arithmetic gives it. As a socially conservative and unionist party, it has absolutely no wish to see Jeremy Corbyn in Downing Street. But it has kept the Conservatives waiting, and used the current position to get as good a deal as possible. Why should we expect it to do anything else? Still, it is hardly seemly for votes to be bought quite so blatantly.

The politics behind much of the criticism of the deal has been equally obvious. Welsh First Minister Carwyn Jones – representing not only the Labour party, but also a nation whose relative needs are at least as great as those of the six counties – abandoned his normally restrained tone to describe the deal as a "bung" for Northern Ireland. Scotland’s First Minister Nicola Sturgeon was also sharply critical of the deal’s lack of concern for financial fairness across the UK. In doing so, she rather blithely ignored the fact that the Barnett Formula, out of which Scotland has long done rather well, never had much to do with fairness anyway. But we could hardly expect the Scottish National Party First Minister to do anything but criticise both the Conservatives and the current functioning of the UK.

Beyond the depressingly predictable short-term politics, the long-term consequences of the Tory-DUP deal are much less foreseeable. It is quite something to threaten the integrity of the Northern Irish peace process and set the various nations of the UK at loggerheads with merely one act. Perhaps everything will work out OK. But it is concerning that, for the current government, short-term political survival appears all-important, even at potential cost to the long-term stability and integrity of the state.

But one thing is clear. The political unity of the UK is breaking down. British party politics is in retreat, possibly even existential decay. This not to say that political parties as a whole are in decline. But the political ties that bind across the UK are.

The DUP deal comes after the second general election in a row where four different parties have come first in the four nations of the UK, something which had never happened before 2015. But perhaps even more significantly, the 2017 election was one where the campaigns across the four nations were perhaps less connected than ever before.

Of course, Northern Ireland’s party and electoral politics have long been largely separate from those on the mainland. But Ulster Unionist MPs long took the Tory whip at Westminster. Even after that practice ceased in the 1970s, some vestigial links between the parties remained, while there were also loose ties between the Social Democratic and Labour Party and Labour. But in 2017, both these Northern Irish parties had their last Commons representation eliminated.

In Scotland, 2017 saw the SNP lose some ground; the main unionist parties are, it seems, back in the game. But even to stage their partial comeback, the unionist parties had to fight – albeit with some success – on the SNP’s turf, focusing the general election campaign in Scotland heavily around the issue of a potential second independence referendum.

Even in Wales, Labour’s 26th successive general election victory was achieved in a very different way to the previous 25. The party campaigned almost exclusively as Welsh Labour. The main face and voice of the campaign was Carwyn Jones, with Jeremy Corbyn almost invisible in official campaign materials. Immediately post-election, Conservatives responded to their failure by calling for the creation of a clear Welsh Conservative leader.

Read more: Did Carwyn Jones win Wales for Labour  - or Jeremy Corbyn?

Yet these four increasingly separate political arenas still exist within one state. The UK was always an odd entity: what James Mitchell astutely termed a "state of unions", with the minority nations grafted on in distinct and even contradictory ways to the English core. The politics of the four nations are drifting apart, yet circumstances will still sometimes mean that they have to intersect. In the current instance, the parliamentary arithmetic means the Tories having to work with a party that celebrates a form of "Britishness" viewed increasingly with baffled incomprehension, if not outright revulsion, by the majority of Conservatives, even, on the British mainland. In turn, the Tories and other parties, as well as the news-media, are having to deal with sudden relevance of a party whose concerns and traditions they understand very little of.

Expect more of this incomprehension, not less, in the post-2017 general election world. 

Roger Scully is Professor of Political Science in the Wales Governance Centre at Cardiff University.

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