Andrew Lilico: The State of the Union

My highly non-trivial dinner companion summed up his thesis thus: "The guys you have in charge here are clever, and they want to do the right thing (more than they're often given credit for), but fundamentally they're lightweights.  On the other hand, it wouldn't make that much difference if they were more heavyweight, because the climate of debate in your country is so impoverished.  You and I know it's a crisis, but these folks around us at the other tables have no idea.  They've become 30% poorer over the past few years, and unless things change they're going to slide further and further, internationally.  They aren't afraid that foreigners might stop lending you money or buying your assets, or that your government could collapse and be replaced by something else, or your economy could be engulfed in inflation or some other disaster because you all still think you're "Great Britain" - you lot need to wake up and realise these things can happen to you, 'cause you're just "Britain" now."

I've been disappointed by our Party's leadership, recently - disappointed its all-consuming fatalism and the distinct impression it gives of lacking ideas.  The range of topics over which this fatalism has spread is remarkable: the economy; the 2015 General Election; the EU; the rise of Ukip.  The Coalition itself was the product of fatalist pessimism - that the alternative would be a short period of minority government and then defeat, rather than victory.  The fatalist pessimist account of the 2010 General Election had it that that was a great result for the Conservative Party (not the failure it really was), because fatalism had extended to the belief that the British electorate is not fundamentally Conservative and cannot be persuaded to believe in the Truth.

I find myself drawn almost inexorably in to this collective Despair.  Maybe politics will only truly rise to the events of our age when crisis becomes acute.  What will it take?  Inflation at 20%?  A further 8% contraction in GDP?  A further round of banking collapse?  A sovereign default?

Could things be even worse than that?  Could we somehow skate through by sheer luck, learning nothing and changing little, and then settle into long-term inescapable decline as other countries benefit from the crisis by changing their cultures and political cultures and re-structuring their economies whilst we fade gently away - like a nineteenth century Spain or a twentieth century Argentina - learning to live with our diminished significance?

No.  No.  No.  I must shake myself, eschew the depressive's scripting of defeat, and repeat - nay, redouble - my efforts.  It will be okay in the end, but only because of the efforts of the vigorous, creative, and resolute to make it so.

We can make things right on the deficit - if we choose to.  There are straightforward - not easy, but straightforward - ways to do that.  Our economy is about the same size it was in 2006.  If we allocated the same amount in real terms as in 2006 for spending on benefits and public services (including health and schools) we would still face a slightly higher total spending because of pensions and debt interest, but the vast majority of our challenge would have been met.  Some departments, of course, have been scheduled to have spending go much less than in 2006 - eventually.  But there is such fatalism about the possibility of doing this with any alacrity.  It's said "these things can't be done overnight".  But it's two and a half years since the Coalition came in - more than 900 "overnights".  How many "overnights" do you need?  The problem hasn't been any intrinsic technical difficulty with cutting back on spending.  It's been the political unwillingness to cut spending where there was the most scope for cutting - in the budgets that had risen the most before: health and schools.  The government claims it's a once-in-a-generation crisis, but is unwilling to respond to that crisis by unpicking the mistakes of the previous administation.  It says that spending rose too much under Brown, but is unwilling to cut spending where he raised it.  It says "We're all in this together", but if you're a doctor on £110,00 a year, you're not in it at all.

The government's defenders on this point say: "We promised not to cut NHS spending.  That might have been a daft promise, but it was a promise and we can't break it now."  To which I say: We promised to eliminate the current structural deficit over a Parliament and to keep our AAA rating - indeed, the latter was said to be the main basis on which we should judge the government.  Why are those promises - those pivotal, central, defining promises of the government - ones it's fine to break when it's unthinkable to break the NHS promise?  It's clearly nothing to do with honour - it isn't that the government feels honour-bound to keep its promises, because it doesn't feel honour-bound to keep its main defining economic promises.  Why, if some promise had to be broken, was it the economy ones and not the (daft, and uncopied by Labour or the Lib Dems) NHS spending promise - which we broke in 2010-11 anyway?  This isn't a government that keeps its promises; it's a government that likes to quote its promises to defend what it decides to do for tactical political reasons, not reasons of any principle.

To try to keep our promises on the deficit - or, if we must break our promises, then spread the breaking of them around so that we're all in this together instead of some parts of society not participating in the corrective exercise - would be hard.  But we should not fatalistically declare that it cannot be done until there is disaster.  A true leader with faith in the triumph of Truth and Virtue tries to prevent disaster; he doesn't simply try to survive politically so that he's around to respond to disaster when it inevitably comes.

We can make things right - or at least better - on the banks.  We are actually doing that a very little bit with some of the most recent reforms.  But we'll start to know things are really changing once they privatise some banks, breaking them up into competing units in the process, and then let some fail.  I propose that the most elegant way to privatise the banks would be that next time they become distressed (probably already, for one or two of them) we deem their shares to have been wiped out - alas! (not!) wiping out the government's shareholding and obviating all government responsibility for the debts of the bank in question.  That would be hard.  But it is possible.  We must not despair.

We can find a place in the world post-EU.  I didn't want to leave, but it was never the kind of arrangement that was going to last for us forever.  We don't need to regard it fatalistically, as our EU departure and the debate thereon being some dread disaster we can no longer avoid.  The EU was good, but will shortly be done.  We should approach that scenario fresh and optimistic, hoping to find some even better arrangement for us for the future.

The rise of Ukip does not have to mean a fissure on the Right of politics.  And we do not have to regard every effort to get back Ukip voters as likely to lose us even more votes elsewhere.  Shake yourselves, and stop scripting defeat before you've begun!  I want us to appeal to Labour voters, Communists, BNP voters, Greens, Ukippers, Christian Democrats, Respect voters - even (the horror!) Lib Dem voters - by convincing them either that we are right or that we will deliver for them in some key respect when others will not.  We should not regard someone that once voted BNP or Respect or Lib Dem as tainted and beyond redemption, as unwanted by us.  We saw from Lord Ashcroft's survey the other day that the single most important factor for Ukip voters was that they felt the other parties didn't want them or their values, that they weren't at home in the way our politics and society has gone and felt no-one in the other parties cared.

These are profoundly and naturally conservative sentiments.  We should not underestimate the threat they could constitute.  As Conservatives we like to quote Robert Peel's principle of embracing change when it is required, but we forget that Peel created such a split in the Conservative Party that it actually died, being eventually absorbed into the Liberal Party - what we now call "the Conservative Party" is the new party of Lord Derby and Disraeli that broke away from Peel's Conservatives over the Corn Laws and called itself the "Protectionists" until Peel died.  The Protectionists were the Ukippers of their day.  The fission to the Right has destroyed then inherited the Conservative Party before.  We should not complacently assume it cannot do so again.

But it is not inevitable that there is such fission.  Many Ukippers, including many former Labour-voting Ukippers, could easily be drawn back in to Conservative circles with a sufficiently sympathetic ear and a sufficiently generous sense of compromise.  The rise and rise of Ukip is not inevitable.  We should seek to counter it.

I believe that if there is a crisis, the British voter will self-educate enough to drive change and turn things around.  The British voter will not be willing to see Britain surrender and gently fade away, even though the British Establishment may be.  But it is negligent for us in the Establishment either to rely upon or to wait upon that.  And just as we should not be fatalistic in policy terms, the Party should not be fatalistic politically.  Rise to the task, my friends.  We are the Conservatives.  We are never out of ideas or out of will.  We haven't driven events and spread our vision and values across the globe these three hundred years just to script our own defeat now.