Leading article: Ed Balls is Labour's accidental gain

Ed Miliband is a lucky politician. At some minor cost to his personal authority, he has accidentally managed to strengthen Labour's collective leadership.

We can see why he overcame Alan Johnson's reluctance three months ago to persuade him to accept the post of Shadow Chancellor. Mr Johnson is a fine communicator, with an engaging persona as a regular guy, and a life story that offers a pointed contrast with the Conservative leadership. Mr Miliband also needed to make a senior Blairite appointment to soothe the boiling resentment of the majority of both his MPs and party members who voted for his brother.

But Mr Johnson's heart was not in it, partly for reasons that have now become apparent; and he allowed his affable self-deprecation to set off a running story about his unfamiliarity with economics. So now the Labour Party has arrived at the obvious lineup in the top jobs, including Yvette Cooper and Douglas Alexander as Shadow Home Secretary and Shadow Foreign Secretary, respectively. And it has done so after Mr Miliband has shown a sincere desire to reach out to his brother's supporters.

What matters, though, is that Ed Balls will now take the fight to the coalition on the central battleground of public spending, tax and the economy. He has already proved himself an exemplar of a certain kind of opposition politics – combative and confident, with a formidable grip on his subject. At Education he made Michael Gove look leaden-footed and error-prone. At Home, he has harried Theresa May by putting down Urgent Questions, ruthlessly exploiting new House of Commons procedures.

The question that bothered Mr Miliband in October – leaving aside any personal issues – was that Mr Balls had taken a counterintuitive line on the deficit in a speech at Bloomberg in July, in the later stage of the Labour leadership campaign. In it, he argued that the policy on which Labour fought the 2010 election, of halving the deficit in four years, still went too far, too fast, even though it went less far, less quickly, than the coalition policy of eliminating the structural deficit altogether in five years.

Who is to say if that was a sincere view, or if it was intended mainly to differentiate himself from his rival candidates to avoid humiliation – which it helped him to do, ending in third place? Now it matters less. Mr Miliband and Mr Balls have negotiated terms. Under their own Granita deal, Mr Balls has decided that growth turned out so strong, as the result of decisions that he and Gordon Brown took in government, that it would be safe to halve the deficit in four years after all.

The Independent on Sunday agrees with that policy, and there is a case for saying that, if Labour is to adopt a responsible stance on deficit reduction, then Mr Balls is the best person to do it. Had Mr Miliband replaced Mr Johnson with, say, Mr Alexander (the only other prominent member of the Shadow Cabinet to say tough things about the need to make deep cuts), a part of the Labour Party might have continued to believe there was an alternative policy, identified with Mr Balls, that would allow them to avoid making spending cuts at all.

It is suggested, not least by our cartoonist, Schrank, left, that Mr Balls's closeness to the last prime minister will hold him back. While it is certainly true that Mr Brown is not exactly electoral helium, according to opinion polls, this newspaper, alone among its peers, took the view that he was a much underestimated leader. He made the right decisions when the banking crisis hit, while David Cameron and Mr Osborne made wrong ones.

There are, inevitably, downsides to Mr Balls's elevation, finally, to the position he regards as rightfully his. His relationship with Mr Miliband resembles not so much that of Tony Blair and Mr Brown, but that of Neil Kinnock and John Smith – the intellectually insecure leader and the bullish numbers man with the potentially election-losing policies. And Mr Balls, having shown a more human side over the past year, needs to carry out further reconstruction work on his public image. On Thursday, for example, he failed notably to conceal his delight as he expressed his sorrow at Mr Johnson's departure.

That said, the opposition leadership team now has a structural integrity and a head-to-head logic making it likely it will be a more effective force against the Government. Sorry as we are to see Mr Johnson go, especially in such unhappy circumstances, the Shadow Cabinet reshuffle is probably a gain for the health of our democracy.