Encore for the Gordon and Prudence Show, but it's nearing the end of its run
ne more Budget, and Gordon Brown will overtake Nigel Lawson's record and go on to challenge Gladstone. He is coming up for his seventh year as Chancellor and by now we know the Gordon and Prudence Show so well that we can hum along with him. That delivery, as insistent as a road-drill, the plonking catchphrases, the tortured arithmetic, the fidgety initiatives, the sinking realisation that we shall have to labour for longer to meet his demands — this is his formula, and he has come to rely on it. Only a year ago it got him hailed as the wonder-working Chancellor who could meet all society's needs. Back on stage for his encore this week, he must have sensed a change of mood. The show has begun to degenerate into self-parody. It now includes a Trades Union Learning Fund and an enhanced fuel allowance for the over-80s. A rustling of plush can be heard under corporate behinds in the stalls. Further back, those who have to buy their own tickets are finding it harder, and from the seats supposedly packed with supporters comes the impatient sound of whistling. Some people, he must reflect, are never satisfied. What is the matter with them? Is it just that they have got bored with his formula and want another script, or have they found fault with the strategy that has taken him and his party so far for so long? This week he looks fallible.
Seizing the height
Few chancellors can have planned for success as he did. His plans must have been conceived a decade ago, under an earlier chancellor, when the pound crashed out of Europe's exchange rate mechanism. Until then, crises had been what you got with Labour chancellors. After the ERM debacle, no one could think that. The Conservatives were driven off the commanding height of economic and financial competence and Labour had the chance to seize it. This required more than bravado. Labour's previous chancellors had come bouncing into office, spending first, borrowing next and taxing later. This would set off a run on sterling. force unpleasant choices on the Chancellor and do nothing for his party's chances at the next election. Gordon Brown drew the moral. Prudence would he his watchword, or at least his catchword, and he would bind himself to her with golden rules. In his first and bold
est action he gave independence to the Bank of England and invited it to set interest rates. The markets applauded, and the pound was if anything too strong for comfort. Then, in the millennium year, with an election looming, he concluded that the time had come for Prudence to pay dividends. He came out as the big spender.
Elephantiasis
One summer day he came down to the House of Commons with a statement and I proclaimed an ecological disaster. The elephants, I said, had taken over the waterhole. The Treasury has to deal with the spending departments of government, and Sir Leo Pliatsky, whose job this had been, once likened it to protecting a water-hole from elephants: 'You drive them off, and drive them off, and in the evening, back they come.' Now the Chancellor welcomed them in. He announced his plans for public spending in the years ahead, which would build him up from the first chancellor to spend a billion pounds a day to the first to spend a billion and a quarter. All would be well, he explained, because he would keep the elephants under rigid control. I doubted it. These elephants. I said, had long memories and knew tricks worth two of his.
Wishful forecasting
By now the elephants are crowding in. Defence, which had been shouldered aside, now finds itself back in line for a wallow and swallow. Health, which has been guaranteed that its allocation will grow twice as fast as the economy, will always want more and come up with some heart-rending story to prove it. The awkward question now is: how fast can the economy grow? The Chancellor's forecasts, which worked out so well for so long, have begun to misfire, and now seem to incorporate an element of wishful thinking. This (so they imply) is what the sums have got to look like if they are to add up. It is no consolation to be told that Continental Europe is doing worse, or not to be told that China is doing better. Higher taxes or higher borrowing or both will have to fill the hole. Where are you when we need you, Prudence? He did not blow you so much as a kiss.
Into the traps
We can now see that two traps were laid for Gordon Brown. The first (and how natural) was to assume that the good times would go on rolling — at least while he was there to make sure that they did. He came to office at the tail-end of a prosperous decade, when expectations were still soaring. He could count on us to keep the economy going and even to allow him to take the credit for it. The mistake that he made is well known to investors: don't, so they say, confuse brains with a bull market. The second trap was set by the elephants. They have spread brushwood and twigs to cover up a pit where their inflation rate lies hidden. Yes, they have one of their own. Inflation in the public sector is running at something like 5 per cent. It goes up as pay goes up, as numbers go up and as administration becomes more elaborate. The Chancellor has to sluice more and more money into this bottomless pit every year and the rest of us get no more out of it. This year, we shall be working for him until well into June. No wonder we complain about the price of tickets.
L nassailable
When things go wrong for a chancellor, they go wrong quickly. At one moment he is bicycling calmly along, like Constable Oates in The Code of the Woosters. with nothing on his mind except his helmet. At the next he is upside-down in a ditch with his wheels spinning above him. The art of being lucky is to know when to dismount. Nigel Lawson missed his chance. We shall see now whether Gordon Brown takes his or whether it gets taken for him. Up, down, or sideways? Can he be, like Nigel Lawson, unassailable? I sense that this week has brought us the last of the Gordon and Prudence Show. To my surprise. I shall miss it.
Previous page
