Nothing George Osborne said in his Autumn Statement can disguise how bleak the figures are

The Chancellor has little ammunition to make his case - and there will be a lot of "extending" and "stretching" resources this grim Christmas

Share

Thoughtfully, George Osborne leaked his big political message in advance. After the US presidential election, he noted in an article that Barack Obama prevailed with one specific message: “Although times are tough, progress is being made. It’s a hard road but the country is on the right track.” Osborne repeated that message at the beginning, middle and end of his statement yesterday. He will be doing so many times up until the next general election.

He will repeat the metaphor with scrappy or no ammunition. He has far fewer grenades than his Tory predecessors had in the 1980s or his heroes from Canada in the 1990s. After the last election, the new Chancellor declared with a flourish that he would wipe out the structural deficit within a single parliament.

That objective was lost a year ago. Now the Chancellor admits his austerity drive will extend well into the next parliament, as other previously declared goals move farther into the distance. Once again, Osborne blamed the eurozone, the wider global economy, along with a convenient new discovery that the crisis in 2008 was even worse than he had thought, which is quite something as he was comparing the UK to Greece between 2008 and 2010, after which he was supposed to come to the rescue.

Irony

The irony is that Osborne is correct in asserting that there are few buoyant markets in the world ready to drive a recovery here, which makes it so perverse that at the beginning he turned off the engine of government activity, the only driver of growth at the time.

Extensive capital spending is one route back towards growth, as the Chancellor almost acknowledges. When unveiling his first self-proclaimed “emergency spending review”, Osborne declared that he remained strongly in favour of more capital spending. A closer examination of the figures showed then that capital spending was being cut. Yesterday, he claimed there would be a switch from current spending to capital expenditure. There is no question that he is right to make such a transfer of funds.

There is a very big question about whether the much-needed infrastructure and building projects will be extensive enough and will get under way with the required urgent speed, or in some cases whether they will get under way at all.

In confronting the gloomy figures, Osborne has reinforced his reputation as being similar to Gordon Brown in one respect – deciding on an argument and marshalling the figures to support it. At times, he sounded like he was Mo Farah, sprinting from one triumph to the next, but Osborne makes his moves in a far gloomier economic context than Brown. As the head of the Office for Budget Responsibility, Robert Chote, put it politely: “The Government’s goals have become more stretching… there will be an extension of the pain.” There is a lot of grim extending and stretching in this cold winter; less Mo than a yoga class going badly wrong.

So far, the Liberal Democrats have been the main electoral victims of the painful contortions. Their pain will almost certainly stretch too. In the early autumn, Nick Clegg proclaimed vaguely the virtues of a wealth tax. He has not got one, nor a mansion tax. Instead, he and his party are left defending sweeping welfare cuts without much of a protective shield, although they get more low earners exempt from income tax.

The various additional anti-tax avoidance schemes are easy to announce. Every chancellor does so twice a year. Even in the unlikely event of some of them being effective, they are not as daring or as guaranteed to raise some money as a mansion tax. And all such initiatives provide tiny crumbs compared with the sums raised when an economy is growing. The lack of sustained growth remains the overwhelming issue.

Balls vindicated

The Shadow Chancellor, Ed Balls, is in the opposite position to Osborne. The Chancellor can spell out 10 election-winning themes before breakfast but lacks a successful economic policy to back them up. Balls has been entirely vindicated in his early assessments of what would happen under Osborne’s policies and yet lacks accessible and populist themes to reinforce his astute judgement.

The vindication of his early warnings should make him more, rather than less, worried that he struggled to make a case in the Commons yesterday and more widely with the electorate. Balls tends to rely on his deeply felt attachment to Keynes and a more immediate five-point plan, without populist phrases to frame an argument.

Sometimes he makes no wider argument at all, as he did so brilliantly in his Bloomberg lecture in August 2010 when he warned of the consequences arising from cutting too fast and deep. He and Ed Miliband still need to spell out more clearly where they stand on “tax and spend”, why that has changed from where they stood in 2010, and what the implications are for their approach to the 2015 election.

Their complex and daunting task is made slightly easier when facing a Chancellor who can only hope he has better ammunition when he claims to be on the right track as the next election moves into view.

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Austen Lloyd: Commercial Property Lawyer - Cheshire

Excellent Salary: Austen Lloyd: CHESHIRE MARKET TOWN - An exciting and rare o...

Austen Lloyd: Residential Property Solicitor - Hampshire

Excellent Salary : Austen Lloyd: NORTH HAMPSHIRE - SENIOR POSITION - An exciti...

Recruitment Genius: Gas Installation Engineer

£29000 per annum: Recruitment Genius: A Gas Installation Engineer is required ...

Recruitment Genius: Domestic Gas Technical Surveyor

£28000 per annum: Recruitment Genius: A Domestic Gas Technical Surveyor is req...

Day In a Page

Read Next
Michael Brown was shot and killed by police in August  

Ferguson: The sad truth is that Michael Brown was killed because he was a black man

Bonnie Greer
A protestor poses for a  

Ferguson verdict: This isn't a 'tragedy'. This is part of a long-running genocide of black men in America

Otamere Guobadia
Homeless Veterans Christmas Appeal: Drifting and forgotten - turning lives around for ex-soldiers

Homeless Veterans Christmas Appeal: Turning lives around for ex-soldiers

Our partner charities help veterans on the brink – and get them back on their feet
Putin’s far-right ambition: Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU

Putin’s far-right ambition

Think-tank reveals how Russian President is wooing – and funding – populist parties across Europe to gain influence in the EU
Tove Jansson's Moominland: What was the inspiration for Finland's most famous family?

Escape to Moominland

What was the inspiration for Finland's most famous family?
Nightclubbing with Richard Young: The story behind his latest book of celebrity photographs

24-Hour party person

Photographer Richard Young has been snapping celebrities at play for 40 years. As his latest book is released, he reveals that it wasn’t all fun and games
Michelle Obama's school dinners: America’s children have a message for the First Lady

A taste for rebellion

US children have started an online protest against Michelle Obama’s drive for healthy school meals by posting photos of their lunches
Colouring books for adults: How the French are going crazy for Crayolas

Colouring books for adults

How the French are going crazy for Crayolas
Jack Thorne's play 'Hope': What would you do as a local politician faced with an impossible choice of cuts?

What would you do as a local politician faced with an impossible choice of cuts?

Playwright Jack Thorne's latest work 'Hope' poses the question to audiences
Ed Harcourt on Romeo Beckham and life as a court composer at Burberry

Call me Ed Mozart

Paloma Faith, Lana del Ray... Romeo Beckham. Ed Harcourt has proved that he can write for them all. But it took a personal crisis to turn him from indie star to writer-for-hire
10 best stocking fillers for foodies

Festive treats: 10 best stocking fillers for foodies

From boozy milk to wasabi, give the food-lover in your life some extra-special, unusual treats to wake up to on Christmas morning
Phil Hughes head injury: He had one weakness – it has come back to haunt him

Phil Hughes had one weakness – it has come back to haunt him

Prolific opener had world at his feet until Harmison and Flintoff bounced him
'I have an age of attraction that starts as low as four': How do you deal with a paedophile who has never committed a crime?

'I am a paedophile'

Is our approach to sex offenders helping to create more victims?
How bad do you have to be to lose a Home Office contract?

How bad do you have to be to lose a Home Office contract?

Serco given Yarl’s Wood immigration contract despite ‘vast failings’
Green Party on the march in Bristol: From a lost deposit to victory

From a lost deposit to victory

Green Party on the march in Bristol
Putting the grot right into Santa's grotto

Winter blunderlands

Putting the grot into grotto
'It just came to us, why not do it naked?' London's first nude free runner captured in breathtaking images across capital

'It just came to us, why not do it naked?'

London's first nude free runner captured in breathtaking images across capital