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Bruce Anderson

Bruce Anderson: The Osborne/Balls fisticuffs - and a deep moral unease

Squeamishness led to incomprehension, and disapproval. There has been a lot of criticism of the Osborne/Balls dogfight. The Chancellor, who won it, attracted most of the opprobrium. Well, I enjoyed the spectacle and it earned its place in a connoisseur's anthology of Parliamentary warfare. This was no stage duel with neutered weapons. Nor was there any question of a reconciling pint afterwards, with the two principals comparing bruises and chuckling. They went at each other with bludgeon and rapier, to kill.

On the Labour side, the atmosphere was crackling with class hatred, a factor which is far more important than it ought to be. These days, very few Labour MPs have horny-handed credentials. Most of them come from middle-class backgrounds; Ed Balls was educated at a distinguished independent school. It is hard to find anyone who can talk with conviction about the Labour movement as a means of emancipating working people and enabling them to realise their full potential. Today, if they were truthful, it would be more a matter of encouraging middle-class people and enabling them to earn higher salaries.

But many Labour MPs still dislike toffs. Moreover, and despite all the evidence to the contrary, it is an article of faith on the boot-boy benches that toffs are wimps: mere public-school popinjays who will be easy to beat. Gordon Brown's regular defeats at the hands of David Cameron did nothing for his equilibrium, and Mr Balls hates losing to George Osborne. On the sunniest of days, Mr Balls's inner pit bull is never far below the surface. On Thursday, as the Chancellor taunted him and goaded him, one came to understand why pit bulls are classed as dangerous dogs, while gaining an insight into the atmosphere in Gordon Brown's Downing St. One was also reminded why the two front-benches are two swords'-lengths apart.

The voters hate all this. They would prefer Parliament to look like the School of Athens, as painted by Raphael. The voters are wrong. Down the centuries, the Commons has been a cock-pit of debate, of national argument - and of liberty. Tempers have often been lost: how could it be otherwise, when great issues are at stake? All Speakers regularly cry for order, because on the big disputed occasions, it is never easy to keep order. Nor should it be. Whatever our current grievances, think about international comparisons. Over time. Britain has a very high place in the league of well-governed nations. Our truculent and unruly Commons is entitled to some of the credit for this. It has served us well. 

Even so, the voters will take a great deal of persuading. There is a lot of moral unease out there: a widespread sense that everything has gone wrong and that decent people have been let down. Defoe said that in his time, there were a hundred thousand country fellows ready to fight to the death against popery, without knowing whether it was a man or a horse. For popery, read Libor. I have a suspicion that the Libor affair had much more to do with desperate - and justified - attempts to stabilise the banking system than with personal profit or criminality.

But the public will be hard to convince, while a swarm of American shyster lawyers - not intended as a tautology - is now scenting vast fees. Even if hardly one person in ten thousand could explain it, Libor has become the shorthand for greed, corruption and cynicism. Although it was sensible of George Osborne to cut off Labour's route to hypocrisy and and humbug, that is not enough.

The government has three related tasks. It has to remind disgruntled Conservatives that there are no magic wands. Second, it must re-fight a battle which Margaret Thatcher seemed to have won forever in the 1980s: the campaign for free markets. Finally, it must reassure unhappy voters that the Cameron project rests on sound moral foundations.

Let us start with the suppression of wizardry. It used to be the Left which would parrot mindless slogans as if this would solve all the world's problems. Now, far too many right-wingers have caught the disease. On Europe, there are those who call for a referendum now, as if that would solve anything. We Tories know what we want: free trade and political cooperation between sovereign states. To avert social disorder and to promote economic growth, we would also like the Eurozone to resolve its currency crisis. Finally, we want to continue to be Europe's most important financial centre. None of those crucial objectives is easy to achieve. None of them would be assisted by a referendum now. Instead, they would all be made harder.

"Tax cuts now" is no better. Although we would all like to promote economic growth, let us start with the first question that Mrs Thatcher would have asked. Where is the money to come from? The cry goes up immediately: "waste". Alas, it is not that simple. Undoubtedly, there is waste, but how does it manifest itself?

In three ways, the first being excessive welfare payments. Yet they almost all go to people with very little money, who usually spend every penny they have. So cuts in their benefits would mean an immediate reduction in demand. The second source of waste is capital projects, some of which are undesirable. Although we can all agree that the wind-farm craze is... crazy, cuts in capital programmes mean lost jobs, fewer orders for British firms: again, a fall in demand. The third element of waste is unnecessary public sector employees, of whom there are plenty. But eliminating their jobs and salaries would mean a further reduction in demand. 

In theory, the tax cuts would replace the missing demand: only in theory. The announcement would be made: tax cuts now, to be paid for by spending cuts later. Leaving aside the exigencies of coalition politics, many of the existing cuts have still to be implemented. There would be justified scepticism as to whether the new cuts would ever happen. It would be argued that these so-called "cuts" were merely an attempt to conceal the government's abandonment of its fiscal targets. Our National Debt and PSBR figures are still frighteningly high. The markets tolerate them - to the annoyance of many Europeans - because they trust the government's fiscal nerve. It that trust were lost, we would be in trouble.

Everyone would lose confidence. The Treasury would have to pay a much higher interest rate on gilts, while the banks would be even more reluctant to lend to SMEs. Gentle reader, reading all about this in the City pages, your initial delight in your tax cut rapidly loses its exuberance. What do you do with the extra dosh? You might well decide to buy gold. Increased demand for gold would not stimulate economic growth.

British tax rates are too high, at all levels. The government spends too much money. There is a moral case for action on both fronts, but you do not try to cross a fiscal minefield with a tax-cutting cavalry charge. Those who believe in easy solutions ought to ask themselves the obvious question. If they really are that easy, why has no-one adopted them?

Faced with so many difficulties, one can understand Ministers' reluctance to stir up unnecessary controversies. yet there is no alternative, for a lot of public debate has taken on a dangerously egalitarian tenor. We have to reassert Tory common sense: to repeat the Thatcherite argument that a country which prevents people from becoming rich condemns everyone to remain poor. Only a healthy free-market society can generate the resources for first-class public services. Certainly, there have been excesses; there have also been a lot of successes. Without our strong financial sector, this country would not be viable. Because he comes from a prosperous - though far from plutocratic - background, David Cameron may be reluctant to make the case against the egalitarians. But they are talking nonsense now, just as they were in the 1970s, when they almost destroyed the country.

In general, Mr Cameron underestimates his own strength. He is easily the biggest figure in British politics. Although a lot of people are irritated and disillusioned, they have not given up on him. He can still command a hearing. People would bitterly resent it if they felt that they were being patronised with phoney optimism, but they do want to know what is wrong, and how the government intends to put it right. Through no fault of its own, the government is still short on deeds. It, and especially the Prime Minister, must therefore seek to compensate, with words.


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