George Osborne looked tired as he gave interviews about the figures announced on Thursday showing the economy grew by 0.6 per cent in the second quarter of this year. But it was a price worth paying for staying up until 2am to join night shift workers in the Midlands at a bakery, a road scheme and Tesco’s distribution centre.
It was a very clever photo opportunity, the perfect backdrop to welcome signs of recovery while insisting there is still a long way to go. The pictures played well on the TV bulletins. In contrast, Ed Balls was in Washington and gave his reaction to the GDP figures with the White House in the background.
It seemed the Chancellor and his Labour shadow had changed places. We might have expected the Labour guy to be with the workers and a Tory Chancellor swanning around in Washington. When Mr Osborne did that last year, sharing the red-carpet treatment with David Cameron, he took his eye off the ball on the eve of his “omnishambles” Budget.
Like the economy, the Chancellor is now in recovery mode. His nocturnal tour shows he has got the message from the focus groups, opinion polls and probably from Lynton Crosby, the Conservatives’ Australian election strategist: it is not enough to bang on about cutting the deficit. The public want politicians to feel their pain as incomes fall behind inflation – and to know what they are going to do about it.
That’s why Mr Osborne’s interviews were peppered with references to our old friend “hard-working families”. The Tories’ potential Achilles heel is that they look “out of touch” – not so much that Cameron-Osborne are “two posh boys,” as the Tory MP Nadine Dorries, inset, put it, but that voters judge them as remote from their own daily struggle.
So the Tories are changing their language in recognition that the 2015 contest will be a “living standards election”. True, they hope to say the Coalition has halved the deficit. True, they will ask voters to let them “finish the job” and not to let Labour ruin it – a powerful attack line when many people still believe the previous government rather than a global crisis caused the deficit.
But it will not be enough for the Tories to fight a negative, Labour-bashing campaign. Elections are usually about the future rather than the past. The “forward offer” is crucial. That’s why Mr Cameron and Mr Osborne have started to raise the prospect of rewarding the public for the years of austerity.
The Chancellor suggests a Tory government would complete deficit reduction with more welfare cuts – a popular message, even if voters didn’t like his divisive “scroungers versus strivers” rhetoric, which has been quietly toned down. The emphasis now is on the “strivers”. Last Sunday, the Prime Minister even raised the prospect of eventual tax cuts.
The recovery, however fragile, poses problems for Labour. It is harder to argue the Osborne economic plan has failed, even though clearing the deficit will take much longer than expected, and the Chancellor has finally changed tack by revving up the housing market. The Coalition can claim it is creating “jobs and growth”.
Some Labour figures felt the party didn’t get the balance right when responding to the GDP figures. “It’s welcome but it’s far too late,” barked Mr Balls, with the emphasis very much on the latter. The shadow Chancellor is unrepentant: he will not let the Coalition forget its “three wasted years” of failure.
Labour leaders are more than happy to fight on the new battleground of living standards. They sense a real opportunity because of what Mr Balls calls “the longest squeeze on family incomes since the 1870s”. They suspect the return to growth will not generate a “feelgood factor” and that voters will feel no better off in 2015 than they were in 2010. Ed Miliband was first to identify the “squeezed middle” in 2010, even though few voters may remember it.
Mr Miliband believes the public shares his view that the economic system is not working for ordinary people, and will therefore warm to his calls for radical change and a more responsible capitalism. He is sure the Tories don’t get that. At a time when voters don’t trust promises by any politicians, the Labour leader is convinced that election pledges must be underpinned by a big vision to have any chance of being taken seriously by the voters. To be fair, he does translate his vision into real world issues such as energy bills and train fares, but he will need to do so a thousand times to get noticed. And soon.
Some Tory backbenchers are getting carried away after the GDP figures; the mood pendulum on their side has swung from pessimism to exuberance in a matter of weeks. One clever photo op by the Chancellor will not win them the next election. Nor will a return to growth unless people really feel it by 2015, which is doubtful. Forget the economy, stupid. Now it’s living standards, stupid.
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