Tag Archives: gideon-osborne

Which of these two characters would you most trust with the economy?

Donkey and Waldorf

One is an annoying talking donkey who came to prominence by getting in the face of a grumpy ogre (who goes by the name of Gordon Brown). The other is the shorter half of a former double act of curmudgeons with an interest in variety performance. And the answer to this question matters a lot: it directly affects the electoral chances of the two main UK opposition parties.

For the past few days, the Tories have gone on the offensive on economics. Following a lead given by his Shadow Chancellor, David Cameron said on the Andrew Marr Show this morning that nationalising Northern Rock would be “the most complete humiliation and failure for the government”. Meanwhile, Vince Cable has spent the last couple of months insisting that nationalisation is the only viable short term option for the company.

And let’s be honest, both Osborne and Cable have had a good few months recently. Agree with it or not, it has to be said that Osborne’s proposal to raise the IHT threshold did him a lot of favours, while Vince Cable’s tenure as Acting Lib Dem Leader won plaudits from across the political spectrum.

All things being equal however, a cursory look at the men’s CVs rather suggests that Cable is the safer pair of hands to run the economy than Osborne. A doctorate, policy advisor to the Kenyan government, lecturer, civil servant, former Chief Economist at Shell, advisor on the Brundtland Commission… Cable broadcasts experience and it comes across. Gideon Osborne on the other hand is a history graduate with some journalistic experience and lots more experience as a political adviser on both sides of the benches. The brutal reason why Cable got all the airtime over Northern Rock in October-November was that it was clear that he reeked of authenticity while Osborne rarely made it further than the partisan soundbites.

Cameron and Osborne’s latest assault is an attempt to regain the agenda on the economy; a tacit acknowledgement that since their IHT coup, both the government and Cable have outmaneuvred them. But once again, does it add up to much more than a bit of partisanship? Their argument is that the government put off a decision because of the prospect of an October election and they cite an offer by Lloyds TSB as one that should have been more seriously considered.

But does this charge stack up? Look at it this way; if Darling had gone for a quick sale (which according to Mervyn King would have involved a whopping loan to Lloyds TSB), would we now be in a remarkably similar situation with Cameron denouncing the government for rushing into a decision because they were planning an early election? Indeed, isn’t that rather similar to the scenario we had in 2005 with Michael Howard attacking Brown for bailing out Rover (only several times larger by order of magnitude)?

My own instincts tell me that regardless of the rights and wrongs of the whole credit crunch debacle in general and Northern Rock in particular, rushing into a quick sale would have been a remarkably irresponsible thing to do when it directly affected billions of pounds of taxpayers money and thousands of jobs. And that’s even assuming the shareholders would have let them (my grandmother is getting bombarded with letters from SRM at the moment). I appreciate I’m biased but the Tories’ line here doesn’t merely strike me as easy partisan point scoring, but bad policy too.

For a long time I’ve felt that Osborne is one of the Tories’ weakest links. A good marketing man, true, but not one with a particular feel for economics, and one with a whiny tone of voice that doesn’t exactly inspire confidence. He is certainly in the wrong job. Cable on the other hand has always been one of the Lib Dems biggest secret weapons. Well, he’s not so secret any more and that could spell trouble for the Conservatives. If the Lib Dems manage to eat into the Tories’ commanding lead as the party most trusted on the economy, then things really could start to get interesting as it is the Tories’ greatest asset and one of the Lib Dems’ greatest perceived weaknesses. Yet could Cameron even contemplate cutting Osborne loose, his closest ally?

Of course, I’m not the only one thinking the unthinkable here: Tim Montgomerie was arguing for him to be made Party Chairman/Tsar back in October. Tim wasn’t attacking Osborne for being weak on the economy, but to argue this at a time when Osborne was still basking in his IHT glory said it for him.

Either way, Clegg should not be shy about keeping Cable in the limelight over the next few months; notwithstanding the importance of giving the public a chance to get to know Clegg himself, Cable should now be considered a central part of the party’s appeal and should be seriously exploited, particularly when the Tories use Osborne.

Vince Cable talks to Quaequam Blog!

Once again, I was delighted to be invited to be invited to take part in another of Millennium’s interviews with party figures. At first we interviewed the two leadership candidates, but it seemed like a good idea to get an interview in with Vince Cable while he was serving as acting leader. He graciously agreed to do this and so the inteview took place at teatime on Monday. But then you know all this because you’ve presumably read all the other versions of the interview already. Apologies for my lateness, I spent the rest of the evening out with friends and have only just had a chance to sit down and do the interview justice.

So, what to make of the “greatest leader we’ll never have” (TM all newspapers)? Well, when Vince first arrived in Committee Room 19 he came across as quite diffident and uncomfortable. Right from the start it was apparent this was not going to be like the interviews we’d had with Chris Huhne and Nick Clegg.

Millennium allowed me to start off and, a little unprepared, I proceeded to spend five minutes waffling on about what should have been a very simple question: given the party’s opposition to the “Conservative consensus” and the Liberal tradition’s opposition to inherited wealth, how did Vince justify our presently uncosted policy to increase the IHT threshold up to £500,000 (for more on this by me, see Comment is Free)?

Vince’s short answer was that our policy is to crack down on IHT, and that the real issue is that the way IHT has been set up means that the wealthy find it very easy to get around it and that it is the comparatively less well off that end up paying it. The Lib Dem policy to extend the so-called “seven year rule” so that gifts would only be exempted if they were made fifteen years before the individual’s death would make it harder to avoid.

Was I convinced by this? I’m afraid not, for three reasons. First of all, the policy has never been sold as “toughen up IHT”, but rather “raise the starting threshold” (pdf). The matter of the threshold wasn’t dealt with at all, despite it being the basis of my question. But finally, I have serious doubts about the practicalities of extending the gift rule. Both my mother and my partner’s family have recently gone through probate. It takes a long time and isn’t a walk in the park. If the concern is for middle-class families who find themselves caught out by the system, I have real concerns that these are precisely the sort of people who will end up getting screwed. Meanwhile, it may catch out the super-rich at the margins, but only those who die in skiing accidents as opposed to the ones who die in their beds. In short, for people already well versed in avoiding the tax, it will be a mild annoyance. For the rest of us, it will be a serious hassle. I’m still entirely unconvinced this is a more practical policy than an accessions tax, I’m afraid.

My second question was about multiculturalism, something which Vince has written two Demos pamphlets on the subject. I made the mistake of poorly phrasing my question, asking how we “calm down” the current debate on conflicting identities in the UK, something which he strongly rejected we should seek to do. Instead, he said, we should try to create a society where such debate can flourish, knowing that conflict will arise from time to time. He singled out Evan Harris for taking part in the Oxford Union debate with David Irving last week. On tackling discrimination there were no simple, coin-in-the-slot answers, he argued, pointing out that the experience of different ethnic communities – not least of all the white working classes who deserve the same attention as any other group.

This is all impeccably liberal stuff, and despite my rants about the Oxford Union last week I’m quite happy that Evan was there to argue against Irving given that the meeting was going to go ahead anyway (I still question the Union and its rather selective approach to free speech however) – I certainly don’t condone the rather strong arm tactics of the protesters who attempted to shut down the debate by force. But I don’t think it moved us forward particularly. What I was hoping for was a pocket summary and update of his latest paper on the subject Multiple Identities – a pamphlet which I enjoyed even if I didn’t agree with all of it. I got the sense this question rather irritated him however, which wasn’t my intention at all.

Vince warmed rather more to my final question however, on how he rated George Osborne. His answer was, basically, that Osborne is a smart political operator but an economic lightweight. He argued that Osborne and Cameron are inseparable and that he would stand or fall with his leader.

In particular, he took issue with the Conservatives’ “opportunistic” stance on Capital Gains Stance, pointing out that the Tories opposed taper relief when it was first introduced by George Brown. This is a good point, and one which we perhaps ought to drive home more strongly.

Overall, Vince gave us all fairly straightforward answers and by the end had warmed up immensely. I particularly appreciated his responses to Paul’s question about Gordon Brown’s “psychological flaws” (he doesn’t have them, but has deep intellectual flaws) and his satisfactory answer to Jonny’s question about whether the “Mr Bean” line was doing the same to Brown as we deplore was done to Ming (answer: Ming was criticised for his appearance while Cable was criticising Brown for his ineptitude). He was quite insightful, and surprisingly upbeat in response to Alix’s question about the Heathrow expansion, arguing that it wasn’t a done deal, that the fact that the environment has gone up the political agenda makes it much harder for the government compared with the last Heathrow expansion and that could only happen if the government were to get its way over planning reform (which is being strongly opposed in the Lords).

The best leader we’ll never have? Impossible to tell. If he had been a candidate I suspect we would have had a very different interview, just as he would have had a very different past month. It is clear that he is a major talent however and one that the new leader – whoever he is – should ensure remains at the centre of our front bench team.

See also: Liberal England, Liberal Burblings, Lindyloo’s Muze, The People’s Republic of Mortimer, Millennium Elephant (plus Love and Liberty and Hug a Hoodie when they get around to typing their versions up).