The credibility crunch
We at The Spectator are concerned about our occasional contributor, Frank Field. In last week’s magazine, the MP for Birkenhead declared that ‘the 10p revolt is unlike any other faced by the Labour leadership over the past 11 years... it has at a stroke placed clear red water between practically the whole of the Parliamentary Labour Party on the one hand and the government on the other.’ Over the weekend, he told the BBC that it was time for the Prime Minister to consult his loved ones with a view to resigning.
Yet it was a very different Mr Field who apologised unreservedly on Tuesday for his personal remarks about Gordon Brown, declared himself to be delighted with Alistair Darling’s (latest) rescue package for the 10p debacle, and said that he now felt able to campaign for the Labour party in the Crewe and Nantwich by-election. Mr Field smiled with the wan rictus of a man who had recently spent an hour or two with the rats in Room 101 or, surrounded by Brownite tormentors, crying out: ‘No, no, not the comfy chair!’ It is depressing, at any rate, to think that he has fallen for this astonishingly cynical ploy by the government. Forking out £2.7 billion of public money, the Chancellor raised the starting point for paying tax by £600, ensuring that 22 million taxpayers who earn up to £40,835 and pay the basic rate of 20 per cent tax will receive an extra £120 in their pay packets this year. A nice windfall, one might think.
In fact, Mr Darling is simply robbing Peter to pay Peter. When the Chancellor said he would finance the package through higher public borrowing, ‘ensuring that we do not take money out of the economy at this time’, what he really meant was that the government had no money to spend, and so was adding to the swollen national debt. Britain already has a fiscal deficit of more than 3 per cent of GDP, higher than any other large developed nation: but, this weekend, that statistic is far from Mr Brown’s mind. In the Crewe by-election, Labour is defending the majority of 7,000 won by the late Gwyneth Dunwoody. After the disaster of the local elections and Boris Johnson’s triumph in London, Mr Brown knows that the loss of the seat to the Tories would make his position deeply vulnerable and might well transform the leadership speculation explored by Fraser Nelson on page 14 into an outright challenge. The PM is prepared to pay any price — literally, it would seem — to avert this outcome, and is painfully aware that David Cameron’s decision to make the by-election a mini-referendum on the 10p fiasco is proving successful. So Mr Brown is seeking to buy the seat on the never-never. Assuming that he wants to preserve Labour’s majority in Crewe, he is spending £385,714 for each of those 7,000 votes. And this from a man who said he wanted to purify campaign finance.
Herein lies the deeper problem facing Mr Brown, and one which will not be solved by any number of panic measures. On Tuesday, the government unveiled its mini-Budget and by-election sweetener; on Wednesday, Mr Brown delivered a preview of the Queen’s Speech, intended to relaunch his premiership and restore faith in his claim to office as man of substance and conviction. The trouble is that no inventory of policies, however worthy, can address the much more fundamental crisis now afflicting Labour.
It is no accident that Mr Brown’s fortunes turned around the time of the general-election-that-never-was last autumn. This protracted folly of speculation, arrogance and then loss of nerve dramatised the sense that the PM, far from being a man of iron, was a chronic ditherer — evasive, slippery, uncertain. The corollary has been a growing public distrust of what the government says about anything. To the credit crunch has been added a credibility crunch.
The crisis over the abolition of the 10p tax rate has entrenched this impression. Mr Brown’s first instinct was to deny furiously that there was a problem at all, insisting that the tax credit system would make up the difference. ‘There aren’t any losers,’ he told the Labour MP Eric Martlew at a meeting of the Parliamentary Labour Party on 31 March — even though it was quite clear that the proposals would disadvantage 5.3 million people. Since then, Mr Brown has had to reverse his position, but only grudgingly and under the greatest parliamentary and electoral pressure.
No less robustly, Mr Darling insisted to the BBC’s Andrew Marr on 20 March that ‘what I can’t do is to rewrite the budget’. Yet — no less wretchedly — that is precisely what he did on Tuesday, desperate to prevent by-election disaster and backbench rebellion over the Finance Bill.
So much for Mr Brown’s fixation with ‘longterm decisions’. His decisions, we now know, are entirely provisional and subject to reversal depending upon the political context of the day. As Chancellor, Mr Brown’s favourite mantra was that there would no return to the supposed ‘boom and bust’ of the Tory years: no short-termism, no opportunism. As PM, he has routinely attacked Mr Cameron for putting political expediency first and for economic illiteracy. This will be a much harder charge to make now that Labour has dug its own £2.7 billion black hole, throwing fiscal caution to the wind in a last desperate bid to win a single by-election. And next time you hear a minister or Labour spokesman accusing the Tory party of promising ‘an unfunded tax cut’, remember Mr Darling’s panic measure this week. This is a government that talks grand strategy, but lives hand to mouth.
Which in turn should give Mr Cameron pause for thought. Yes, he faces an enfeebled, exhausted Prime Minister fighting for his life. The Conservatives are more confident and energised than for many years, and with good reason. But the shamelessness with which Mr Brown has used the nation’s credit card in a last-ditch bid to buy next week’s by-election shows how brutal and bloody the months ahead will be. This is a Prime Minister who will do anything — anything — to cling to power.
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