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

Photo: Getty
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The campaign to keep Britain in Europe must be based on hope, not fear

Together we can show the world a generous, outward-facing Britain we can all be proud of.

Today the Liberal Democrats launched our national campaign to keep Britain in Europe. With the polls showing the outcome of this referendum is on a knife-edge, our party is determined to play a decisive role in this once in a generation fight. This will not be an easy campaign. But it is one we will relish as the UK's most outward-looking and internationalist party. Together in Europe the UK has delivered peace, created the world’s largest free trade area and given the British people the opportunity to live, work and travel freely across the continent. Now is the time to build on these achievements, not throw them all away.

Already we are hearing fear-mongering from both sides in this heated debate. On the one hand, Ukip and the feuding Leave campaigns have shamelessly seized on the events in Cologne at New Year to claim that British women will be at risk if the UK stays in Europe. On the other, David Cameron claims that the refugees he derides as a "bunch of migrants" in Calais will all descend on the other side of the Channel the minute Britain leaves the EU. The British public deserve better than this. Rather than constant mud-slinging and politicising of the world's biggest humanitarian crisis since the Second World War, we need a frank and honest debate about what is really at stake. Most importantly this should be a positive campaign, one that is fought on hope and not on fear. As we have a seen in Scotland, a referendum won through scare tactics alone risks winning the battle but losing the war.

The voice of business and civil society, from scientists and the police to environmental charities, have a crucial role to play in explaining how being in the EU benefits the British economy and enhances people's everyday lives. All those who believe in Britain's EU membership must not be afraid to speak out and make the positive case why being in Europe makes us more prosperous, stable and secure. Because at its heart this debate is not just about facts and figures, it is about what kind of country we want to be.

The Leave campaigns cannot agree what they believe in. Some want the UK to be an offshore, deregulated tax haven, others advocate a protectionist, mean-hearted country that shuts it doors to the world. As with so many populist movements, from Putin to Trump, they are defined not by what they are for but what they are against. Their failure to come up with a credible vision for our country's future is not patriotic, it is irresponsible.

This leaves the field open to put forward a united vision of Britain's place in Europe and the world. Liberal Democrats are clear what we believe in: an open, inclusive and tolerant nation that stands tall in the world and doesn't hide from it. We are not uncritical of the EU's institutions. Indeed as Liberals, we fiercely believe that power must be devolved to the lowest possible level, empowering communities and individuals wherever possible to make decisions for themselves. But we recognise that staying in Europe is the best way to find the solutions to the problems that don't stop at borders, rather than leaving them to our children and grandchildren. We believe Britain must put itself at the heart of our continent's future and shape a more effective and more accountable Europe, focused on responding to major global challenges we face.

Together in Europe we can build a strong and prosperous future, from pioneering research into life-saving new medicines to tackling climate change and fighting international crime. Together we can provide hope for the desperate and spread the peace we now take for granted to the rest of the world. And together we can show the world a generous, outward-facing Britain we can all be proud of. So if you agree then join the Liberal Democrat campaign today, to remain in together, and to stand up for the type of Britain you think we should be.