Morning Call: pick of the papers

The ten must-read commment pieces from this morning's papers.

1. US has been let down by its leadership (Financial Times)

A deal that extends unsustainable tax cuts for 98 per cent of Americans is no victory, says Nouriel Roubini.

2. Iain Duncan Smith's polemic is politics at its most cynical (Guardian)

How does the secretary of state's conceit, that in-work benefit claimants are fraudsters, serve the public interest, asks Zoe Williams.

3. Cosy up to China – are you sure about that? (Times) (£)

It’s easy to envy the boom, but as Beijing’s influence spreads around the globe we must confront the human cost, says David Aaronovitch.

4. We can end the elderly care lottery (Guardian)

Means-testing winter fuel payments could prevent old people losing their assets and their dignity, argues Paul Burstow.

5. Let taxpayers share rail fare pain (Independent)

More effort must be made to spread the investment costs more widely, says an Independent editorial.

6. Britain would vote to stay in the EU (Financial Times)

The UK electorate would almost certainly opt for the status quo, writes Gideon Rachman.

7. Fighting back against the left-wing guerrillas (Daily Telegraph)

Foes of public sector reform are waging war at a local level – they must be roundly beaten, says Sean Worth.

8. America could still go over the cliff — and take the rest of us with it (Daily Mail)

The American people, and, indeed, the rest of the world, urgently need to revise their view of how economically strong this ailing superpower really is, says Simon Heffer.

9. Christopher Martin-Jenkins: we're all the poorer for his passing (Daily Telegraph)

Our institutions need many more 'outsiders’ with the enthusiasm and knowledge of Christopher Martin-Jenkins, says Peter Oborne.

10. Cosmetic surgery is bad. That women feel the need for it is worse (Independent)

Now even the British Association of Aesthetic Plastic Surgeons is demanding change, writes Mary Ann Sieghart.

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Autumn Statement 2015: George Osborne abandons his target

How will George Osborne close the deficit after his U-Turns? Answer: he won't, of course. 

“Good governments U-Turn, and U-Turn frequently.” That’s Andrew Adonis’ maxim, and George Osborne borrowed heavily from him today, delivering two big U-Turns, on tax credits and on police funding. There will be no cuts to tax credits or to the police.

The Office for Budget Responsibility estimates that, in total, the government gave away £6.2 billion next year, more than half of which is the reverse to tax credits.

Osborne claims that he will still deliver his planned £12bn reduction in welfare. But, as I’ve written before, without cutting tax credits, it’s difficult to see how you can get £12bn out of the welfare bill. Here’s the OBR’s chart of welfare spending:

The government has already promised to protect child benefit and pension spending – in fact, it actually increased pensioner spending today. So all that’s left is tax credits. If the government is not going to cut them, where’s the £12bn come from?

A bit of clever accounting today got Osborne out of his hole. The Universal Credit, once it comes in in full, will replace tax credits anyway, allowing him to describe his U-Turn as a delay, not a full retreat. But the reality – as the Treasury has admitted privately for some time – is that the Universal Credit will never be wholly implemented. The pilot schemes – one of which, in Hammersmith, I have visited myself – are little more than Potemkin set-ups. Iain Duncan Smith’s Universal Credit will never be rolled out in full. The savings from switching from tax credits to Universal Credit will never materialise.

The £12bn is smaller, too, than it was this time last week. Instead of cutting £12bn from the welfare budget by 2017-8, the government will instead cut £12bn by the end of the parliament – a much smaller task.

That’s not to say that the cuts to departmental spending and welfare will be painless – far from it. Employment Support Allowance – what used to be called incapacity benefit and severe disablement benefit – will be cut down to the level of Jobseekers’ Allowance, while the government will erect further hurdles to claimants. Cuts to departmental spending will mean a further reduction in the numbers of public sector workers.  But it will be some way short of the reductions in welfare spending required to hit Osborne’s deficit reduction timetable.

So, where’s the money coming from? The answer is nowhere. What we'll instead get is five more years of the same: increasing household debt, austerity largely concentrated on the poorest, and yet more borrowing. As the last five years proved, the Conservatives don’t need to close the deficit to be re-elected. In fact, it may be that having the need to “finish the job” as a stick to beat Labour with actually helped the Tories in May. They have neither an economic imperative nor a political one to close the deficit. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.