Political commentary

No time for Sandy

Ferdinand Mount

'The beggars wrapped in their blankets 1 squatting outside the old souk of Tamanrasset were as dismal a crowd as I had met in the Sahara. Richard Hannay had seen a sight or two in the trenches, but these eerie pleas for baksheesh gave me the creeps. One old fellow in particular had something unearthly about him. His eyes were glassy, like those of a dervish who smokes hemp, and his silvery pate shone in the light of the desert moon. And yet there was something about the Old Harrovian socks poking out from under the jellaba that aroused my suspicion. Suddenly I remembered where I had seen those socks before.

`Great Scott, Sandy, you old devil,' I ejaculated.

`No, Denis, actually.'

Meanwhile, a thousand miles down the Nile, the Honourable Peter Tapsell, one of the seven most powerful financiers in the world, was giving a lecture on the failings of monetarism amid the potted palms and gilt mirrors of the Cairo Hilton. There was mischief afoot. From the sands of Arabia to the great river delta, this mysterious tycoon was to be found on his strange quest. He taught Shikaris in the Pamirs round their camp fires about short-term interest rates. He held the caravanserais of Bokhara en- thralled with his views on the public sector borrowing requirement. What was the dark secret that drove him so far from home? What was this devilish thing called monetarism that had driven so many good men out of their senses? Who was The Woman he hoped to forget?

Meanwhile, five thousand miles to the North, over the frozen wastes of Norway an aircraft juddered through the blizzard, The passengers sat tense and anxious in their seats. Suddenly, over the loudspeaker crackled a strangely familiar voice: 'Hullo, hullo, this is Michael Foot speaking, this wouldn't happen under socialism, I say, I say. It's the Tories that bring the snow, ha, ha. Mrs Thatcher's the Abominable Snowwoman, I say that was a good one. It's quicker by train, oy. It's the way I tell 'em, y' know.'

A wild-eyed gesticulating man with white hair staggered out of the cockpit with an air hostess under each arm. The passengers looked at each other with consternation. Was he under the influence of some rare South American drug? Or was this not the real Right Honourable Michael Foot but an imposter? Who was behind this most dangerous international conspiracy the world had ever seen? And what was the meaning of these appalling jokes? Were they some fiendish code? Or was this yet another role for Sandy Arbuthnot, that master of disguise? The responsible observer is torn by con- tradictory impulses: that politicians ought to get out and about and see more of the world and, contrariwise, that they ought to be kept locked up because, when they do get out, they are allowed to behave so peculiarly that they return to Westminster odder than ever. Their expectations of drama are hyped up; their reluctance to ap- ply themselves to the duller niceties of runn- ing the country remains ingrained. What, one can't help wondering, is to become of us all?

It is at least possible that the party battles at this stage in the Parliament are much less important than they are cracked up to be. Differences can be put out of sight, if not entirely out of the voter's mind. Most peo- ple are now aware that the Labour Party is now a party of the far Left; but it may perhaps be possible to conceal just how far Left the Parliamentary Labour Party will be after the General Election.

For the Conservatives, similarly, the political differences which are represented as coming to a head with the budget may be rather easier to solve than they are said to be. At the moment, the tax revenue is flow- ing in nicely, pent up until these last months in the financial year because of the civil ser- vants' strike which put the VAT computer out of action.

Sir Geoffrey Howe could alter existing tax rates by up to £2,000 million a year without endangering his target for govern- ment borrowing in the coming year. Thus he could uprate the dole to take full account of inflation, raise the personal tax allowances similarly and reduce the employers' national insurance surcharge with only modest compensating rises in the duty on alcohol, tobacco and petrol — and that would count, economically, as a no- change Budget.

He could even go a little bit further to meet Sir Ian Gilmour and Co without much risk; with a modicum of cunning in the presentation even a sober Budget can be made to sound relatively genial.

The ultimate difficulty lies not within the Conservative Party, but outside in the real world. And it is reflected inside politics only in the unhelpful sense of the shadows flickering on the wall of the cave, To put the problem at its gloomiest for Mrs Thatcher, she appears to be a year behind schedule, The year which Keith Joseph admitted the Tories had lost could yet turn out to be the crucial year.

Consider those things which are at pre- sent going right for the government: the rate of inflation is slowly coming down, wage rises in the current round are running at a tolerable if not brilliant level (let's say about 7-8 per cent), production is slowly

recovering from its nadir in the spring, government expenditure is not running away, even if it is not entirely under con- trol, and the money supply is ditto.

These achievements may sound in" dividually mediocre, but collectively they add up to a country slowly entering a vir- tuous circle. Inflation comes down, so does government spending, and hence so do taxes. Price rises going down eventually meet take-home pay going up. Real in- comes begin to rise, along with profits; businessmen begin to invest, consumers begin to spend; hey nonny.

I think it was Mr Nigel Lawson who in- vented the 'crossover point', the moment during your progress towards your low- inflation, low-tax utopia at which real in- comes begin to rise.

The trouble is that, on present calcula- tions, the crossover point could well be

delayed until dangerously late next year. If

prices rise at an annual rate of about 10 Per cent and earnings at about 8 per cent bet- ween now and mid-1983, people are not go- ing to start being better off until just before the General Election. And the feeling of be- ing better off takes a notoriously long time to sink in.

These calculations may sound 1111" pleasantly gross. You may well say that

man does not vote for bread alone. But NIT

Lawson is not only the most eloquent apologist for the government's actions; he is also the author of the theory that elec-

tions are decided by whether living stall° dards are rising or not. And the conjunc'

tion of theory and practice does look a little ominous for the Conservatives. If things are corning right, they may be coming right too slowly.

So the temptation for the government (the imperative for its critics) is to hurry up the return to rising real incomes by making huge tax cuts on 9 March. Have not pay set- tlements so far this year been relativelY modest? Isn't this the least risky time to put more money back in people's pockets?

Alas, in post-war Britain there has been an obstinate tendency for incomes to creep

up much faster than was hoped. Wages maY be sticky downwards, but they shoot up- wards like greased lightning. In six months time, we could well be wondering how we could have ever been worried about the

consumer's lack of spending power. it would surely be dotty for Sir Geoffrey to make the same mistake in his fourth Budget as he did in his first. The most assuredly

fatal course — for the three million unemployed no less than for the govern- ment — would be to provoke yet another

inflationary crisis and yet another delta' tionary jolt. For each time we slam on the

brakes, the worse the shock to employment' This year, Sir Geoffrey is, at last, in a position to feel his way towards expansion,

doing something to satisfy his critics without alarming his friends. The last and usually fatal illusion of chancellors is that!

by some daring coup or mastery of political disguise, they can break free at one bound' Sir Geoffrey must not start thinking he Is Sandy Arbuthnot, let alone Beau Geste.