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Bruce Anderson

Bruce Anderson: In austere times the winning politicians will be the ones who tell the truth

There is one conclusion to be drawn from the Autumn Statement. Maggie was right; there is no alternative. No-one has set out a plausible alternative strategy: a quicker and less painful route back to economic growth. George Osborne did not only sound authoritative on Wednesday because he had learned the lessons of the Budget degringolade. He was impressive because he was telling the House about the facts of economic life. Ed Balls was not only bad because he tripped over his own feet, which he now blames on a childhood stammer (he is not good at self-pity). He was poor because he was incapable of outlining a deficit strategy. He did not even sound as if he was convincing himself. He also sounded as if he should be covered by the Dangerous Dogs Act, but anger is not a policy.

There is a further, self-evident point. If there were an alternative, the Chancellor would already be implementing it. If there were an alternative and for some bizarre reason the Chancellor and the PM were refusing to adopt it, the Liberals would have left the coalition. They are all Thatcherites now; all seeing reason. Growth needs demand, and in the UK, that is a problem. There are four major potential components of increased demand. The first is consumer spending, which is held back by indebtedness. The second is government spending, ditto. Third comes investment by business. Plenty of companies have healthy balance sheets, but if they spend the money, where will they find customers? That leads to the fourth, exports.

That takes us to the Eurozone. The debt mountain is frightening. Normally, countries have a brutal way of dealing with such high levels of indebtedness: default, or inflation, or both. Admittedly, we British did cope with the government indebtedness created by the Napoleonic War, but there are three caveats. First, it took years. Second, there was serious political and social instability during the early phase. Third, we had the Industrial Revolution, to boost productivity, and the Empire, to absorb the output. Many years ago, Jonathan Miller produced Alice in Wonderland on television. John Bird, who played the Caterpillar, invented a wonderful line, worthy of Lewis Carroll. "I can do nothing for you," he told Alice. "I can't do nothing for you just at the moment, but I hope to be able to do nothing for you very soon".

Sometimes it seems as if we are on the verge of caterpillar economics. So the Government must pull us back from that brink, and that might be easier than it appears. Ministers should begin by employing an unusual political tactic. They should tell the truth. The public know that we are in a mess; no-one over the age of eight believes in Santa Claus. It is never difficult for Messrs Cameron and Osborne to command a hearing, even if it is an unenthusiastic one. They should do more to explain themselves. Next, not everything is gloomy. Rolls-Royce has an order-book worth £74 billion pounds. In the North-East, some car factories are breaking world records for productivity. Admittedly, they are Japanese-owned, but they have a British workforce. I keep on hearing about manufacturing firms which are globally competitive. They are a long way from the metal-bashers of yesteryear. The nearest that they come to a production line is a computer-guided laser beam. That  puts them in the vanguard. Even in hard times, even in challenging markets, they are flourishing.

Because of Michael Gove's reforms, it will gradually become easier for these firms and others like them to recruit the employees they need without importing them. Equally, the welfare reforms should improve the UK's labour market. Amidst the public-spending crisis, that is one consolation. If money had not been so tight, we might never have set about reforming the ill-fare aspects of the so-called welfare state. There is one difficulty. In the early 1960s, John Hare, then the Minister of Labour, received a delegation of the unemployed. Having exceeded their allotted time, they were  still banging on. Hare got up: "Don't know about you chaps - but I've got work to do". Although today's politicians are more sensitive, it is still awkward for prosperous, well-fed-looking characters to empathise with the hardships of the poor.

Then again; Messrs Cameron and Osborne versus Messrs Miliband and Balls in a human sympathy competition: the Tories would have every chance. Our current Ministers will remain firm in purpose. They will refuse to underestimate the obstacles or to be deflected by fantasy. The PM and the Chancellor are replete with self-confidence and they should not be afraid to display it. Some voters will resent it. Plenty of Lefties would try to out-snarl Mr Balls (they would fail). But in austere times, politicians who tell the truth and appear to know what they are doing can win respect, even if grudging. David Cameron and George Osborne should ignore the yelps and growls from the Lefties' kennels. A far larger number of voters will find reassurance in self-confident leaders.


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