I’m still seething after Cameron’s speech on Friday. Coming in late, I won’t rant on redundantly except to add a couple of points:
1) Sometimes soundbites can bite you on the bum. Gideon Osborne on the Today programme on Friday managed to claim that a) it was time to question how the “house caught fire” and b) that Labour “didn’t fix the roof when the sun was shining.” Now, I may not know much about housing, but I am unaware of how a lack of roof could cause a house to catch fire. This may sound a rather pedantic point, but it does seem that during a time of crisis all we are getting from the Tory front bench is pat phrases.
2) The Tories have chosen this moment because they judge the immediate crisis to be over. In the City maybe, but the rest of the country has barely begun to feel the after effects. It speaks volumes that politicians, and the Tories in particular, only judge it necessary to put on a show of unity for the City and not the rest of the country. It shows who they consider their true masters to be.
3) Crude is now cheaper than it was 12 months ago, and half what it was in July. Back then, when the market cost was high, the Tories were offering to “share the pain” and cut fuel duty. The quid pro quo was that when the price of crude was low, they would raise taxes. So why aren’t they calling for increases now? Doesn’t this show the vacuousness of their policy in the first place?
Gordon Brown has ruled out a handout to help people with winter fuel payments a few days after his office was insisting that he definitely wasn’t. Add those two together and you have the possibility of a windfall tax which will only be used to reduce the PSBR. Since this would almost certainly be total insanity, I think we can safely say that the windfall tax won’t be happening no matter how hard Labour backbenchers stamp their feet.
I agree with Nick Clegg: there shouldn’t be a windfall tax but utility companies need to do much more to help people insulate their homes and tackle fuel poverty. Slooshing the money in and out of government coffers would be pointless even if it wasn’t likely to end up getting held up to pay for something else.
What interests me about this story though is how upfront Compass have been about pressuring Brown and Darling on the specific issue of a windfall tax. Superficially I can see why it ticks all their boxes; Compass has gone a long way from its original founding statement (pdf). This was steeped in liberalism. Since then, they have literally leapt into bed with the Tribunite left (the very thing that Lawson et al were denouncing in the 90s) and shown that when it comes to liberty, they are very fair weather friends.
They are very good on coming up with ‘solutions’ while Progress and whingers like Charles Clarke are notably silent when it boils down to specifics. But that doesn’t mean they are the right answers. Worse, the demand for a windfall tax has left Brown in a no-win situation. Either he refuses their demands and faces a backbench rebellion or he capitulates and looks weaker than ever. Frankly, given the parlous situation he’s in, I’m amazed that Compass think that Brown will ever conclude that the latter is the lesser of two evils. If he were to give in, after giving earlier this year on income tax and raising duty on petrol, his authority would be shot to pieces.
It’s weird, because I didn’t see it coming, but Labour is now tearing itself apart in a remarkably similar way to how the Tories destroyed themselves in the mid-90s. At least with the Tories it was over fundamental points of principle; with Labour at the moment it is more steeped in tactical judgement. There certainly are differences of principle, but that debate isn’t really getting a chance to get going while this agonising dispute about tactics and process rages.
All Charles Clarke provides us with is another frustrated ex-minister. Nothing new there. Compass offer Labour something far worse: an alternative power base. In the longer term that may be in Labour’s interests: a bit of ideological purity might be the only thing that holds the party together in the upcoming wilderness years. But at the same time, let’s not kid ourselves, it is helping to secure a Tory victory.