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23 October 2017

Look, Tories, no one is falling for your “no magic money tree” argument so give it up

It’s tone deaf, it’s impotent, and it’s not even bloody true.

By Jonn Elledge

It must be very weird being a Conservative at the moment. In just over six months, the narrative has flipped from “eternal Tory hegemony!” to “oh shit we’re going to lose the next election, possibly some time next week”. And this at a time when Labour has a leader and policies which, the consensus among grown-up, sensible people* had held, would prove about as electable as a bout of scrofula. For a committed Tory activist, this must be a bit like finding out the world is triangular, and made entirely of pork.

They’re not taking this lying down, of course. No: the party has adopted a two-pronged strategy to win back any voters that might be feeling tempted to vote for Jeremy Corbyn’s Labour party.

One prong involves dismissing any even mildly social democratic proposal as the sort of thing that leads inexorably to the gulag. The other involves intoning the phrase “magic money tree” over and over again like an incantation that will cause Labour’s poll lead to burst into flames and melt, like the face of a Nazi at the end of Indiana Jones.

The first of these is self-evidently ridiculous and not worthy of serious analysis and anyway I’ve already done it. The second, though, is not only winding me right up, it’s doing so in five different ways.

1) It’s tone deaf.

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This was blindingly obvious on the campaign trail, all the way back in June. On a pre-election Question Time, an NHS nurse complained plaintively to Theresa May that her wages had effectively not risen in eight years. May’s response included the dread phrase, “There isn’t a magic money tree that we can shake that suddenly provides for everything that people want.”

There are so many problems with this that it’s almost a listicle in itself. For one thing, MPs have had above inflation pay rises over that eight year period, which is not a great look. For another, the phrase “everything that people want” made it sound like the nurse was some ludicrous indulgence like a yacht or something, not slightly more money to do her job – something that in any other decade of the last 200 years would have seemed perfectly natural and reasonable.

But a big one is that the tone of the answer just didn’t fit the question. The question was emotional; the answer was wonkish. It’s like offering a drowning man a lengthy explanation of why you never passed your school swimming certificate: he doesn’t give a shit, he just wants your help.

It was obvious that this was a terrible answer when it got May into trouble nearly five months ago, yet here we are. One might almost think they haven’t come up with anything better.

2) It’s impotent.

Crumbling infrastructure, inadequate housing supply, wobbling public services… The list of problems which could be addressed, at least in part, by an injection of cash is a long one.

Yet in many cases the Tory response has been not to deny the reality of the problem, merely to shrug their shoulders and say there’s no money on hand to address it.

In other words, “there is no magic money tree” sounds a lot like “we have no earthly idea how to fix this”. That may very well be true – but it’s not a response that seems likely to impress voters, is it? Especially when…

3) It’s not true.

I mean come on, everyone knows that money can always be found for important things. The triple lock, which keeps the state pension rising faster than the rate of incomes? No problem. £1bn for Northern Ireland, to buy the DUP support necessary to prop up Theresa May’s government? Easy.

But other things, where the beneficiaries are younger, poorer, less helpful to the Conservative party? Somehow there just isn’t the cash for that one.

They’re taking us for bloody fools.

4) No really, it’s not true.

In practical terms, what’s more, there very clearly is a magic money tree. It’s not literally a true, of course, which is a pity. But there are two very obvious ways in which Britain seemingly is capable of generating money from nothing.

One is that the nation controls its own currency. That doesn’t give the Treasury infinite freedom, thanks to things like inflation targets, bond markets etc. But it does mean that it controls its own money supply, and can create pound coins more or less at will. In the most literal sense there is a magic money supply: how else to explain quantitative easing?

The other is the housing market, where people who spent a few thousand pounds on a house back in the early 1980s have found that they are now magically in possession of a pile worth half a million. At no point did they do anything to earn this money – yet there it is, conjured up from nowhere.

I will be more open to the “no magic money tree line” when ministers start addressing it to 55 year olds worried about their house prices, too.

5) It distracts from the real problem.

Industrial economies all used to be a bit like magic money trees, in their heyday. Productivity would climb, wages would rise, and each generation would be richer than the last. For most of history, this didn’t happen – then, for 200 years, it did. It was amazing.

Yet now, in Britain, it seems to have stopped, and nobody is sure why. Productivity is flat. Wages aren’t rising. You’d think the party of free markets and capitalism would be focused on trying to get the machine going again.

But no. Instead, they patronise us, by openly sneering at the idea we might spend money on anything good, without even noticing that by doing so they’re merely highlighting their own failure as a government.

And that’s still, thanks to James Cleverly, not their worst argument. Amazing scenes.

*Bite me.

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