Steve Richards: In turbulent times, can the PM go with the flow?

Leaders are slow to move in a time of flux. They look back, then forwards and act in conflicting ways


Who's up and who's down? Who can make the best jokes? Who looks good on TV? These are questions that are great fun to ask and even more fun to answer. They matter, too: politics is partly an art form. But they are nowhere near as important as the great currents shaping events around bewildered leaders, whether they look good or not.

Since the global financial crisis of 2008, the tidal waves have been wilder than usual, exposing the inefficiency and iniquities of unconstrained markets. They have started to change the political and economic landscape. For now, we see only the early symptoms. The Coalition is one sign. In Britain, we are used to single party governments. In the first election since the financial crisis, voters could not decide. Now the Coalition seeks to adapt to the waves, but, conditioned by the old order of the 1980s and 1990s, cannot quite bring itself to do so. David Cameron and George Osborne know something big is going on, seek to convey that they know and yet, in policy terms, are confused, partly clinging to old assumptions as if this was 1983 or 1997.

They ache to drop the top rate of tax on high earners. Osborne appeared to be following the technique of Gordon Brown by commissioning a report on an issue the outcome of which has already been decided. But, in spite of his reputation for tactical brilliance, Osborne is not as surefooted as the unfashionable Brown was in his early days at the Treasury. According to the Daily Telegraph, his report on the top rate of tax shows a "surge" in revenues, not what Osborne had hoped to find. This must be the only occasion when a Chancellor is disappointed to hear of money pouring into the Treasury.

Irrespective of its practical merits, polls suggest the top rate is popular as voters edge tentatively towards a new keenly felt sense of fairness. Cameron and Osborne know this and cannot do what they want to do. This is not 1997, when Tony Blair and Brown felt the need to show they were relaxed about the rich getting much richer and made the commitment not to raise the top rate. Something big is happening when Cameron and Osborne find themselves in the opposite position of not being able to scrap the higher rate. Instead, they wait uneasily, hoping for the space to do so after 2015. A new focus on fairness is taking hold.

Cameron shows he recognises this in what he says about the separate issue of executive pay. In his interview on Sunday with Andrew Marr, Cameron cited undeserved awards as an example of "market failure". This acknowledgement is quite a leap. Not so long ago, some in his entourage worshipped uncritically at the altar of markets. But, in spite of the recognition, Cameron cannot quite bring himself to act in a way that will make a practical difference. Transparency will not work. We know about the greed of bankers and are angered. In response, the bankers opt for vilification and take the cash. Transparency is good, but it is not enough.

In acknowledging the validity of the fairness issue, Cameron joins the unstoppable tide. In the end, something big will happen, but not yet. Leaders are slow to move at a time of flux. They look back, then forwards and act in conflicting ways. Such is the force of the tide, Cameron moves from an instinctively wary attitude towards the state to a more equivocal position. His confusion is vividly illustrated in his recent declaration that nursing standards must improve and nurses should see a patient once an hour. This is a good target, but Cameron is not meant to believe in targets from the centre. (Disastrously, he has dropped the target on waiting times and, of course, waiting times are soaring.) His NHS reforms devolve power from the centre to a new quango, to GPs and to the private sector, so he can do no more than issue "guidelines". The NHS requires more sophisticated targets, smaller, more efficient PCTs, better-managed hospitals and more productive GPs, arising from a more nimble, efficient state. Evidently, Cameron senses his reforms are out of step or else he would not be issuing targets, but he cannot bring himself to scrap them or the vision that underlies them. In this tentative transitional phase, he opts for centralised exhortation and extreme forms of devolution.

Since 2008, questions have raged about fairness, the role of the state and markets. The Coalition sees the tidal waves, but cannot quite ride them. As in the 1970s when the corporatist era came to a dramatic, but gradual close, rulers struggle to adapt, even though they recognise the need. In their internal agonising, the leaders of the Coalition are transitional figures like Heath, Wilson and Callaghan, rather than masters of a new era that demands subtle, but stringent approaches to fairness, delivery and accountability. The confused fragility ari sing from recognition that things must change and the fearful reluctance to act accordingly is one an effective opposition could turn to its overwhelming advantage. /

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