Osborne’s Stand Up Routine

Gideon stood on the platform ready for his Conservative Conference speech, half-smiling, eyes slightly glazed – the precise expression of someone trying to work out a joke that everyone else already got. To compensate, he cracked some hilarious jokes of his own. There was the one about his own cabinet colleague being fat (give me a moment to wipe the tears of laughter from my eyes) and the one about the Miliband brothers being brothers. There may have been a couple of knock-knock jokes, possibly one that started “my mother in law…” – I’m not sure. I passed out briefly with a strange mixture of rage and boredom.

Source: Reuters

We were spared jokes about the masturbating habits of teenage boys, sparking hope Gideon was trying to use fresh, crisp material. Sadly, it was about as crisp and fresh as the salad garnish in a greasy spoon in 70’s Barnsley. The speech centred on the now-too-familiar theme of blaming everyone else for the economy’s lack of recovery.

First in the firing line was, naturally, the previous government. Now, I will not pretend that the last administration covered themselves with glory on the issue. But the fact remains that the economy was beginning to recover quite robustly at the time the Tories took over and has slowed down significantly since. The IMF have revised the 2011 UK growth forecast 4 times this year already, from 2% to 1.7% to 1.5% to 1.1%. And there are still three months to go.

So, when is the cut-off? When do we exit this Twilight Zone within which the current government can take credit for any positive development, but have ostensibly no influence over anything negative? I turn to the words of Osborne’s buddy, Cabinet Minister Francis Maude. This was what he said about the newly elected Labour Government in June 1998, after they had been in power for just over a year:

“After only 14 months, [the economy] is coming apart. [The Government’s] economic policies are in disarray and the public finances are unravelling… It is time for [the Government] to take responsibility for its actions and stop blaming everyone else. This is the Government’s strategy. These are their choices and decisions. As the economy flags, it will be the Government’s fault. It will be a downturn made in Downing street.” Hansard link

Next in Gideon’s sights were the banks. “The message from this hall is clear”, he said. “They let down their customers, they let down their shareholders, and they let down their country.” Funny thing is, only three months ago he had the perfect opportunity to deliver that message to the right hall – when he spoke at the London Mayor’s Dinner for Merchants and Bankers of the City of London. He said nothing of the sort. The tone of that speech fell only marginally short of holding hands and singing “Kumbaya”. Like every good comedian, Gideon adjusts his material depending on the venue.

Maybe the banks have been punished enough. They did, after all, make significant concessions on Project Merlin earlier this year. This was the government flagship banking policy; the compromise which explained why they would refrain from regulating banks’ conduct and bonuses more stringently. The key promise by banks was to lend more to SMEs.

So, why is it that 8 months later Osborne is talking about Credit Easing? A scheme under which the Treasury will provide loans to SMEs, at the risk of taxpayers? This potentially vast amount of money will not even show on the balance books as an increase in national debt. We are getting financial instruments of equal value in exchange, explained Philip Hammond MP on Newsnight (IOUs – possibly worthless ones since these are businesses that banks didn’t deem credit-worthy). It saddles the country with a massive, invisible liability.

And here’s the kicker – for most loans the scheme will be administered by high street banks, who will presumably take a cut without assuming any of the risk. It’s a nice “thank you” to the sector which provides over half of all Tory party funding.

Last on the hit-list were bloody foreigners – sorry, our European partners. A lot of congratulating and patting of backs – how right the Conservatives were to oppose entry to the Euro. Little mention of the fact that they were in opposition at the time and so, the decision not to enter the Euro was made by Labour. Little mention that the Euro with a powerful economy like the UK in it, may have been a very different and much more robust animal. A lot of tutting and wringing of hands. Those continental chaps really ought to sort their lives out.

The Eurozone is, according to William Hague, “a burning building with no exits”. I am no monetary expert, but taking Bill’s analogy, if the house next to mine was on fire I would grab a bucket – for both selfless and very obvious selfish reasons. I certainly would not stand in my front garden beaming with Schadenfreude, telling my neighbours they’re not putting the fire out quickly enough.

Especially if I were partially responsible. And we are. Because the thing that never gets a mention is that, maybe the Eurozone building is badly designed, but it was the finance arsonists in Osborne’s beloved City of London and Wall Street that started the fire.

But it won’t all be plain-sailing for the wealthy. Gideon issued a grave warning to the rich who evade tax: “We will find you”. Well, he wouldn’t have to look far. One of the biggest evaders – Sir Philip Green, who hides his huge profits from Topshop and the Arcadia Group under his wife’s mattress in Monaco – was hired by this government as an advisor.

There were more anecdotes, skits, jokes and one-liners to come. Like the idea that introducing a fee for suing one’s employer for unfair dismissal will make it easier for businesses to hire people.  That’s right; not easier to dismiss people, but to hire them. Also an increase of the time after which significant employment rights kick in from one to two years. Because, presumably, one year is not enough to assess whether someone is good at their job. A mention of “the right of the unemployed to get a job and not be priced out of the labour market” – no doubt an overture to an attack on the minimum wage. A review of public sector employees who get paid to be part-time union reps, which is, you understand, in no way a revenge beating to the unions for being difficult over pensions.

And after all that, the biggest cracker of all (sadly, too late in the year to be a contender for an Edinburgh Comedy Award): about the Tories being the party of employment rights because – wait for it —– they introduced The Chimney Sweepers Act 136 years ago. I don’t wish to be unkind to Osborne’s researchers and speech-writers. It is entirely possible that this was the most recent piece of legislation of benefit to working people introduced by a conservative government. Or the only one.

And the rotten cherry on top of this rancid comedy trifle? A plea to the Bank of England, please, to print more money, please, please. Quantitative Easing. The very same measure which, when suggested by Alistair Darling (at a time, I might add, when inflation was much lower), was branded by Osborne himself as “the last resort of desperate governments when all other policies have failed.”

And so it is. Because the truth is that this Coalition is failing in the only task for which it had a true electoral mandate – not the dismantling of the NHS, not student fees, not tax breaks for the wealthy, not the selling of forests, not the closing of libraries – but to oversee an economic recovery. And the reason it is failing is truly, very simple.

When they came into power, they made a decision to overplay massively the extent of the problem in order to advance an ideologically-driven agenda. To use fear, not hope, as the primary tool of Government. Frightened people do not oppose or object; they are easier to manage. Frightened people work 12 hours a day, watch Eastenders, go to sleep and, in their prayers, thank God that they have an underpaid job. Frightened people work in servitude until they have paid back all the debt into which they have been forced, and then drop dead.

Unfortunately the plan back-fired. They were so effective in their tactics, that they scared the entire economy into stagnation. They have caused such a crisis of confidence that demand is flailing. The transfer of public debt to private household and company debt (which I first identified in March) is not happening. Individuals are just not spending and so businesses are not getting the orders. Cameron and co. have scared the country into another recession.

And so, when Ian Duncan Smith and others equate the task ahead to “slowly turning around a tanker”, I get nervous about the idiot in the cargo-hold, with the big corkscrew.

No wonder Gideon doesn’t get the joke. He is the punchline.

Source: Reuters