Watching Gordon Brown’s fantasy Budgets often felt like consuming a large dish of soused herrings — sour, vinegary, and more chewy protein than was palatable.
By comparison, George Osborne’s first effort was chocolate cake topped with whipped cream and strawberries. Given the differences between them, you might think it should be the other way around.
No! Osborne satisfied our despairing appetite for realism, honesty and a massive aspiration for a healthy, self-funding economy in the medium term. How we enjoyed every cut-throat word of it.
Despite his detractors in the City and the media, Osborne’s reputation is made. This Budget will be remembered even more than Geoffrey Howe’s pitch perfect 1981 effort — in which he defied 364 top economists to return the country to growth within a year — simply because, in scale and in enterprise, it tops it by a mile.
The structural deficit will be eliminated by 2014, producing a surplus that will begin the long haul of lowering the UK’s massive stock of public debt. Under Osborne’s strict rule, it will top off at 70% of GDP, not the expected 100% from Labour’s deficit halving plans.
This is serious stuff. It will need reductions in departmental spending of up to 25% across the public sector — apart from Health and International Development. The latter, of course, are political choices not economic ones. Any half competent economist can spot the waste littering these inefficient agencies of the State. I am sure they are marked down for major surgery in the Conservatives’ second Parliament — minus the Lib Dems, perhaps.
One thing I enjoy about this hybrid administration is the zeal with which it scraps anything that has Gordon Brown’s stamp on it. Out goes the FSA, the laughable “Golden Rules”, hugely complex benefit mountains, and, as we’ll hear in the autumn spending review, much of Brown’s cretinous agenda for public sector dominance of personal behaviour.
Brown must wonder why he bothered to build such a vast top-down infrastructure of command and control, especially as all that treasure spent didn’t win him his coverted General Election victory. The Tories are clearly intent on total ruthlessness where corrupt Scottish Labour politics are concerned.
The question we have to ask is why our democratic processes didn’t protect the nation against the mafia-like tactics of Gordon Brown, Mandelson and the rest of New Labour’s despicable crew.
Osborne’s Budget gives us hope that we will never see their like again.
Speculation is rife that the social democrat contingent in the Lib Dems, led by Charlie Kennedy, could split away from the Coalition. I don’t see that happening for a year or two, at least until Labour starts getting decent polling results under a new leader. Harriet Harman is planting the seeds of that move furiously. It could happen within this Parliament.
Nick Clegg and the genuine Liberals may even unite with the Tories to form a real Liberal Conservative Party. His loyalty so far suggests that this could be a return to the old Conservative dominance of British politics for decades to come.
When the eurozone goes, it will go suddenly. One moment it will be there, and then it will have vanished into the historical annals of catastrophic human vanity projects that disappeared.
Gordon Brown, who claimed to have “saved the world”, was partly instrumental in all this. He it was who transferred the massive private debts of the ailing banks onto the public balance sheet, thereby creating the current crisis: Sovereign Debt.
The world followed the sorcerer’s apprentice into universal contagion. Brown made his claim for glory, now he must bear the approbrium of putting the world’s financial systems at deadly risk.
Europe is the epicentre of the new Armageddon, and the euro currency is its central cause. Britain did well to stay out of it, but, as an EU member, we are still trailing in the wake of this approaching cataclysm, subject to bigoted laws and restrictions from Brussels.
To make matters worse, regulators are depressing the money supply right around the world by their insistence on higher capital ratios in the banking sector.
Moreover, Britain is being contaminated from the Continent in ways that are not being explained to the general population unless they read the FT or the business section of other newspapers, notably, the Telegraph. We are in the eye of a storm, and it’s relatively calm … for the moment.
If Greece, Spain, or Portugal collapse, banks across the European Union will be left holding almost worthless sovereign bonds. It will be the end of the road if trillions of sovereign debt is written off, or “restructured” in the jargon. Major banks and corporations will fail.
Such contagion would leave governments helpless to respond. Theoretically, the IMF would be bust. The US Senate has already made its position clear by 94 votes to 0 — no more American dollars.
Almost the minimum that can happen now is an awesome deflation across Europe and America — already the US money supply is shrinking at an alarming 10% on an annualized basis. A double-dip recession is at the benign end of the spectrum.
The worst case scenario is that a worldwide contagion begins on the European continent. August 1914 will have its 21st-century anniversary in four years. And the grandiose political vanity of Continental politicians will be at the heart of it.
This sunny spring could represent a kind of Edwardian glow before the chancellory lights go out once more across Europe.
David Cameron should use his new leverage to negotiate the UK out of the danger zone and back to full independence.
[7.30pm GMT 11 May] David Cameron is the new Prime Minister of the United Kingdom. He is the Queen’s 12th Prime Minister of her Reign, the youngest since Lord Liverpool in 1812.
[7pm GMT 11 May] David Cameron is heading towards Buckingham Palace to kiss hands with the Queen on appointment as Britain’s new Prime Minister.
[6.43pm GMT 11 May] Gordon Brown has left the Palace and is no longer Prime Minister. Britain as of now has no PM. The Queen herself holds that power until, in 15 minutes, David Cameron is expected to arrive and relieve his Monarch of that burden.
[6.20pm GMT 11 May] Gordon Brown announced he has resigned both as Prime Minister and leader of the Labour Party. He is currently on the way to Buckingham Palace to tender his resignation to the Queen. David Cameron is expected to go to the Palace soon. Nick Clegg is expected to be Deputy Prime Minister in the new Government.
[5pm GMT 11 May] The Queen is in Buckingham Palace as a deal is very close between the Conservatives and Lib Dems. Her Private Secretary is reported to be in the Cabinet Office. Brown is expected to resign tonight to take up a career of writing and charity.
[4.17pm GMT 11 May] The BBC’s Nick Robinson is reporting that fixed, four-year Parliaments part of deal with Lib Dems.
[4pm GMT 11 May] Gordon Brown will resign his seat and leave politics altogether.
[3.45pm GMT 11 May] Sky reporting that staff assembling in 10 Downing Street to say goodbye to the Browns.
[3.35 GMT 11 May] Meeting of the Privy Council in Buckingham Palace in 25 minutes. Although a routine one, it could become involved with the fast-moving events.
[3.15 GMT 11 May] The Evening Standard is reporting that Gordon Brown is about to resign. He will go to the Palace this evening or tomorrow morning. The Queen will then send for David Cameron.
[3pm GMT 11 May] There are reports on the BBC that Gordon Brown’s baggage is being loaded into cars as I write. Now denied.
It also looks as if the Conservatives will form a pact with the Lib Dems later today — “The only deal in town” (Lib Dems).
Could David Cameron go to the Palace this evening? We await the Queen’s helicopter from Windsor imminently.
I’ve just watched the most extraordinary row between Labour spin doctor, Alastair Campbell, and Sky News’s Political Editor, Adam Boulton.
At one point it looked as if they were about to come to blows. Boulton, in very aggressive terms, accused Campbell of “telling him what to think”, and he kept repeating that almost like a man possessed.
Campbell kept his cool but seemed surprised at the fury of Adam Boulton’s reaction. Sky’s veteran presenter, Jeremy Thompson, tried to cool the clash, but looked embarrassed at Boulton’s continued tirade.
In the end Sky cut to Gordon Brown’s resignation announcement.
I must say, I thought Adam Boulton’s aggression was rather unprofessional, even given Campbell’s well known serpentine method of dealing with journalists. Clearly, the two men don’t get on, and a lot of repressed fury poured out in the confrontation.
Boulton has been under momentous pressure during the election and is undoubtedly exhausted. Today he snapped.
Unedifying? Yes; understandable? Yes; but it was unprofessional.
I hope he keeps his job, though. He would be hard to replace.
It was a moment of clarity that has been missing from the discourse of the European Union for years. The Chancellor of Germany, increasingly impressive Angela Merkel, announced in Berlin that the future of her country “in Europe” is now at stake.
It could have been a bluff, of course, designed to frighten member states back into line. But surely events have gone beyond that now? In Athens, the Government is under siege by rioting protesters. Three people are reported dead as I write.
Contagion is not just on the horizon, it’s here now, stalking the streets of Portugal, Spain and Italy. On some measures, Ireland and Britain are in there too.
We are in a situation where most countries are facing fearful debt crises, with public debt rising to 100% of GDP, and well beyond in many cases, Greece being a good example. And yet, the tottering Club O’Med countries are being forced to contribute to the bailout of Greece, as is Britain through the IMF segment of the deal. Can’t you just picture a snake eating its own tail here?
Fantasy economics is at play now. The point about debt is that the money has aready been spent. It can’t be reclaimed from an empty pot. Neither can it be magicked away by a debt amnesty. Someone always loses.
When Gordon Brown makes out that “the recession is over”, he fails to convey the fact that the recovery has been bought with staggeringly unsustainable levels of indebtedness, both public and private.
The real level of Britain’s public debt, which includes off-balance sheet items, such as engorged public-sector pension liabilities, plus PFI projects used to build all those schools and hospitals he boasts about, is now around 2.2 trillion pounds. That’s 157% of GDP.
The notional liabilities of nationalized Royal Bank of Scotland alone is said to be four times UK GDP.
Private indebtedness also exceeds Britain’s annual income, and will have to be paid down or written off at some point.
When Brown makes his spurious and profoundly dishonest claim about the recovery, he fails to mention the costs and liabilities he will leave behind when he vacates his office in 10 Downing Street on Friday, or in the weeks to come.
British voters are not stupid. They know his spending promises are as void as any vacuum, which will be Gordon Brown’s bequest to the nation. Inheritance tax was never his strong point.
Many of us have written off the EU in the past, but it’s hard to see how it can survive if its strongest member decides that further participation could bring down its own hard won economic position in the world. As one of the few surplus states it has great strength. But, like China it’s being constantly assailed by debtor nations.
I sense the coming of a new hard core of European states, led by Germany and France on terms that will not attract a Tory Government in Britain.
Glorious isolation is preferable to bedding down with the quarrelsome gang on the Continent.
Whatever results from all this, it’s going to be a turbulent journey.
Watching Gordon Brown’s fantasy Budgets often felt like consuming a large dish of soused herrings — sour, vinegary, and more chewy protein than was palatable.
When the eurozone goes, it will go suddenly. One moment it will be there, and then it will have vanished into the historical annals of catastrophic human vanity projects that disappeared.
I’ve just watched the most extraordinary row between Labour spin doctor, Alastair Campbell, and Sky News’s Political Editor, Adam Boulton.
It was a moment of clarity that has been missing from the discourse of the European Union for years. The Chancellor of Germany, increasingly impressive Angela Merkel, announced in Berlin that the future of her country “in Europe” is now at stake.
