After a year when most people in No 10 seemed to be staggering from day to day, rebounding from one crisis to the next, John Major's advisers are finally enjoying the luxury of being able to lift their bleary eyes to the middle distance. As they do so, they sound more confident about the future of this besieged administration. Mr Major may not sparkle, goes the refrain, but he has become toughened for the long haul - a 'stayer'.
In fact, his prospect of going down in history as a not-bad prime minister (or better than that) now rests entirely on this vision of calm doggedness. At the next election, expect Conservative Central Office to market him not as Mr Ordinary, as in 1992, but Mr Unflappable - a cool suburban Macmillan, the Man Who Kept His Nerve.
A grain of truth there - or propaganda? Mr Major's attitude to the recovery will be the only real test. If it is safe to say some sort of recovery is coming, it is also pretty safe to predict that it is unlikely to feel as exhilarating as the last recovery. Unemployment will come down only slowly. Real earnings will rise only slowly. House prices, left to themselves, will not rocket.
The shape of the recovery will owe more to individual psychology than to computer-driven models. And there can be few people who are not still uneasy, aware that higher taxes are coming soon - and perhaps vaguely worried about a balance of payments crisis and higher interest rates, too. Mood, not mathematics. For a couple of years now, the savings ratio has been higher than many in the City predicted. It may fall, but not, I think, very quickly.
Left to ourselves, many of those of us in work will behave as private rationalists, declining to empty our savings accounts or greatly increase our debt. We have been burnt too recently. Meanwhile employers, struggling with tight margins and aware that price increases are likely to stay low, will perhaps be a little more reluctant than usual to concede inflationary pay rises. A tough public sector pay policy will help.
Such individual and corporate behaviour would help to produce the recovery the country needs. A short- term boom based on inflationary pay increases, a spending spree on imported goods and fast-rising house prices would be no recovery at all, merely the bulimia economics of splurge and disgorge. Recovery, properly defined, would begin with that much rarer and more precious thing in modern British history, years of relatively high savings, high investment, low inflation and low real earnings increases.
All this would be good - but it would hardly help a government as unpopular as this one. It would produce that strange thing, a recovery that didn't really feel like a recovery - a recovery that left the shabby furniture standing where it was. The 'feel-glum factor' would be strong.
So, however irrationally, we would all blame John Major and Norman Lamont for the collective impact of our mass of private decisions. There would be more years when the Government was accused of drift, incompetence, lack of vision. The polls would remain bad. There would be more muttering about Mr Major's own position - and plotting.
At that point, some economic Old Nick would appear at Downing Street, a clutch of the nastier editorials in hand: 'Come on, John. It's gone on too long. Stop worrying about that socking great public sector borrowing requirement. Forget the next round of tax increases and put off Michael Portillo's latest public spending cuts. Give us the good times. Oh, and why not increase mortgage interest tax relief while you're about it?'
A traditional splurge-recovery would be dangerous in the short- term, pointless in any other term. It would also go against the current puritan atmosphere of the country. But even so, it would probably be possible to manage. You only have to look at the history of British consumer prices since 1945 to know where our instincts lie. And you only have to look at any television news piece on the economy, and see how quickly it uses shots of estate agents' billboards, to recall our national economic fetish.
It would be no mean feat for Mr Major to keep his nerve, insist on taxing back the horribly high PSBR, and accept that a true recovery will happen slowly and would be the opposite of a high-street and property boom, not equal to it. The temptation to proclaim happy days (or at least not inconsiderably pleasant days) will be strong. And so, with a diminishing, disloyal Commons majority, will be the temptation to use a short-term boomlet to launch an early election.
It would be a meaningless, ignoble strategy. There have been plenty of prime ministers who managed to combine success in elections with failure at economic management. If Mr Major really wants to do something different - to change the country in any substantial way - then he has no alternative but dogged endurance. One Tory MP I met recently did a spontaneous war dance of delight: 'It's coming]' he crowed. One didn't have to ask what. It is coming. But Mr Major's watchword should be reconstruction, not recovery.Reuse content