Leading article: The subtle art of economic opposition

Ed Balls will bring a killer instinct but will he also bring strategic judgement?

Share
Related Topics

The letter of resignation that Alan Johnson sent to his party leader yesterday represents the former postman's final delivery. Mr Johnson has stepped down as shadow Chancellor, citing personal reasons. But his turbulent three and a half months in the job, during which he has stumbled over the rate of VAT and the speed at which Labour planned to close the deficit, no doubt smoothed the way for the decision. Only last week Mr Johnson found himself being taunted in the House of Commons by the Prime Minister for his lack of economic grip. He also had to perform a spectacular personal reversal last month over his opposition to a graduate tax.

And so an impressive career in frontline politics, which has taken in the Home Office and the great departments of health and education, comes to a rather sad end. But as someone who came to a realisation early last year, when Gordon Brown was under serious pressure, that he simply had no appetite for the top job in British politics, it is not particularly surprising that Mr Johnson has decided to walk away from frontline politics now.

Fortunately the Labour leader, Ed Miliband, had talent to draw on in his emergency reshuffle. Yvette Cooper becomes Home Secretary. Douglas Alexander takes on foreign affairs. And Liam Byrne will shadow work and pensions. And most significantly, in the shadow chancellorship, Ed Balls now has the portfolio he wanted when he failed to win the Labour leadership.

Mr Balls will not need to buy a copy of Economics for Dummies (an unfortunate joke from Mr Johnson when he was appointed last October) to prepare himself for the job. But he does come with the significant baggage of being Mr Brown's principal economic adviser for more than a decade. Mr Balls will bring the killer instinct of an attack dog to the job. But the crucial question is whether he will also bring good strategic judgement.

Mr Balls yesterday set out his intention to challenge the "false claim of this Conservative-led Government that our investment in schools, hospitals and police, rather than the global financial crisis, caused the deficit". Mr Balls is right to point out that the Tories have shamelessly misrepresented the causes of the 2008 meltdown for ideological and political reasons. They have attempted to frame what was, at heart, a tale of private sector recklessness (particularly in the financial sector) as a problem of government over-borrowing. If we are to learn the lessons of the meltdown, that is a narrative that needs to be debunked.

Yet Labour did make mistakes over the economy, particularly in becoming over-reliant on the revenues from lightly regulated financial services and a property bubble. Mr Brown, as Chancellor, also ran a fiscal deficit at what turned out to be the very top of the economic cycle, leaving Britain less well prepared to deal with recession than other nations that had been more conservative with their public finances.

So Mr Balls needs to avoid the trap of arguing that everything about the previous government's record was without fault. Coalition ministers will be keen to cast Mr Balls as a deficit-denying throwback to the former regime. Mr Balls needs to find the right balance between attack and recognition of past errors.

This is a crucial moment in the political battle over the economy. It will soon become clear whether the Government's hasty deficit reduction strategy is likely to cure, or undermine, the economy. If it turns out to be the latter, the country needs a shadow Chancellor capable of holding the Coalition fully to account.

React Now

Latest stories from i100
iJobs Job Widget
iJobs General

SThree: Trainee Recruitment Consultant

£18000 - £23000 per annum + Uncapped Commission: SThree: As a Trainee Recruitm...

Recruitment Genius: Factory Operatives

£7 - £8 per hour: Recruitment Genius: This high quality thread manufacturer ba...

Ashdown Group: Trainee Consultant - Surrey / South West London

£22000 per annum + pension,bonus,career progression: Ashdown Group: An establi...

Ashdown Group: Recruitment Consultant / Account Manager - Surrey / SW London

£40000 per annum + realistic targets: Ashdown Group: A thriving recruitment co...

Day In a Page

Read Next
August 1923: Immigrants in a dining hall on Ellis Island, New York.  

When will the Church speak up for the dispossessed, and those that our political system leaves behind?

Stefano Hatfield
Mexico president Enrique Peña Nieto  

The UK is rolling out the red carpet for President Peña Nieto, but his security forces have blood on their hands

Kate Allen
The difference between America and Israel? There isn’t one

The difference between America and Israel? There isn’t one

Netanyahu knows he can get away with anything in America, says Robert Fisk
Families clubbing together to build their own affordable accommodation

Do It Yourself approach to securing a new house

Community land trusts marking a new trend for taking the initiative away from developers
Head of WWF UK: We didn’t send Cameron to the Arctic to see green ideas freeze

David Nussbaum: We didn’t send Cameron to the Arctic to see green ideas freeze

The head of WWF UK remains sanguine despite the Government’s failure to live up to its pledges on the environment
Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Author Kazuo Ishiguro on being inspired by shoot-outs and samurai

Set in a mythologised 5th-century Britain, ‘The Buried Giant’ is a strange beast
With money, corruption and drugs, this monk fears Buddhism in Thailand is a ‘poisoned fruit’

Money, corruption and drugs

The monk who fears Buddhism in Thailand is a ‘poisoned fruit’
America's first slavery museum established at Django Unchained plantation - 150 years after slavery outlawed

150 years after it was outlawed...

... America's first slavery museum is established in Louisiana
Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

Kelly Clarkson: How I snubbed Simon Cowell and become a Grammy-winning superstar

The first 'American Idol' winner on how she manages to remain her own woman – Jane Austen fascination and all
Tony Oursler on exploring our uneasy relationship with technology with his new show

You won't believe your eyes

Tony Oursler's new show explores our uneasy relationship with technology. He's one of a growing number of artists with that preoccupation
Ian Herbert: Peter Moores must go. He should never have been brought back to fail again

Moores must go. He should never have been brought back to fail again

The England coach leaves players to find solutions - which makes you wonder where he adds value, says Ian Herbert
War with Isis: Fears that the looming battle for Mosul will unleash 'a million refugees'

The battle for Mosul will unleash 'a million refugees'

Aid agencies prepare for vast exodus following planned Iraqi offensive against the Isis-held city, reports Patrick Cockburn
Yvette Cooper: We can't lose the election. There's too much on the line

Yvette Cooper: We can't lose the election. There's too much on the line

The shadow Home Secretary on fighting radical Islam, protecting children, and why anyone in Labour who's thinking beyond May must 'sort themselves out'
A bad week for the Greens: Leader Natalie Bennett's 'car crash' radio interview is followed by Brighton council's failure to set a budget due to infighting

It's not easy being Green

After a bad week in which its leader had a public meltdown and its only city council couldn't agree on a budget vote, what next for the alternative party? It's over to Caroline Lucas to find out
Gorillas nearly missed: BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter

Gorillas nearly missed

BBC producers didn't want to broadcast Sir David Attenborough's famed Rwandan encounter
Downton Abbey effect sees impoverished Italian nobles inspired to open their doors to paying guests for up to €650 a night

The Downton Abbey effect

Impoverished Italian nobles are opening their doors to paying guests, inspired by the TV drama
China's wild panda numbers have increased by 17% since 2003, new census reveals

China's wild panda numbers on the up

New census reveals 17% since 2003