Wednesday, 2 March 2011

Matching Labour's spending plans

Plenty of tribal abuse for George Osborne in yesterday's Guardian from his article called Labour's reality deficit. One argument often used against him on economic policy was that the Conservatives pledged to match Labour's spending plans up until 2008 - the implication being that the Tories were just as complicit in the economic meltdown as Labour. 

But if you look back to Michael Howard's election campaign of 2005, the Conservatives were quite explicit about cutting public spending, albeit by a paltry £2 billion at that time - although Howard Flight and Oliver Letwin appeared to have other ideas. He also committed the party to formally managing immigration in an attempt to engender integration after the years of open-door immigration as well as addressing the widening democratic deficit so apparent across the EU and its institutions. Precisely the issues that have become most problematic for Labour.

And the result? A massive outcry from the left that the 'same old tories' were intent on dismantling the state for ideological reasons (sound familiar?) or are 'institutionally racist' to talk about immigration (remember Gordon Brown's 'bigot-gate' moment?) or are just a bunch of swivel-eyed xenophobic bigots, obsessed by Europe. Although it seems the first unintended consequence of the Lisbon treaty is now going to cost British women around £35bn in additional motor insurance.

Michael Howard lost the election and the easiest way to neutralise the issue was then to accept Labour's spending plans - just as Gordon Brown had accepted Conservative spending plans going into the 1997 election before embarking on a spending spree that our children will still be paying for - through off-balance sheet PFI costs - in thirty years time. What will be interesting to see, is what Labour commits itself to in the next parliament for reducing the other half of that record deficit it racked up whilst in office. It seems that Labour did indeed find a very successful way of binding the hands of its successors.