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The Borrowers
Way back in the mists of time, when Gordon Brown was chancellor, his press officer Ian Austin voted Labour and governments had majorities, borrowing was the Treasury’s guilty secret. Whenever Ed Balls need to find some extra cash here or there, he would often explain it away in a post-Budget briefing by saying borrowing would rise rather than taxes.
After the deficit ballooned following the 2008 global financial crisis, borrowing became a dirty word and the Tory party hammered the message hard. So much so that the very first page of Ed Miliband’s 2015 manifesto was devoted to a pledge that every policy would be paid for “without a single penny of extra borrowing.”
Labour’s electoral rebound two years later came after Jeremy Corbyn and John McDonnell put a multi-billion pound capital investment fund at the heart of their alternative to Tory austerity, all funded by, you guessed it, the B-word. The Tories complained McDonnell would “rack up tens of billions of extra borrowing for our families”, but the attack line fell flat.
Fast-forward to 2019 and the Conservatives are actually trying to borrow Labour’s tactics on borrowing. Sajid Javid’s new fiscal ‘rules’ outlined today increased the cap on annual investment in projects like road and rail to 3% of national output. Javid plans for an extra £100bn over five years, nonchalantly admitting ‘you could easily add another £100bn to that’ but the details would be set out in the Conservative manifesto.
Not to be outdone, McDonnell went even further, promising an extra £55bn-a-year on infrastructure, plus a £250bn ‘green transformation fund’. Both parties say it makes sense to exploit record low interest rates to fund much-needed investment. All of which provides an opening for a more fiscally cautious party, and lo and behold Liberal Democrat Treasury spokesman Ed Davey warned that both parties were ‘writing promises on cheques that will bounce’.
There is, of course, the other B-word looming in the background. Brexit’s impact on growth “could mean the economy could be 5% bigger under Labour than the Conservatives by 2022”, according to an IFS/Citi study reported in the FT reported last month.
But before Labour sticks that quote on its leaflets, it’s worth noting the IFS swiftly pointed out: “If accompanied, though, by full implementation of Labour’s policies on tax, nationalisation, share ownership and labour market regulation, it is impossible to say whether the net effect would be better or worse than leaving the EU with a more growth-friendly set of policies.” Yes, any gain from remaining in the EU could be wiped out by Corbynomics.
The second full day of the election campaign was not just about borrowing cash, but borrowing votes. The new ‘Unite to Remain’ alliance of Lib Dems, Greens and Plaid Cymru unveiled 60 seats where their pact would operate. It has some oddities, including Exeter, where Labour MP Ben Bradshaw is the most Remainery of Remainers his party has ever seen (as former Miliband adviser Stewart Wood tells our Commons People podcast this week).
It remains to be seen just whether the British public are as keen on tactical voting as many are assuming. As a student, I recall being patronised by a pollster (now very senior) when I questioned his claim during the 1987 election that ‘of course tactical voting will mean Margaret Thatcher will lose her majority’. He was convinced voters would back Labour and the SDP/Liberal Alliance in different seats. Thatcher secured a second landslide majority of 102.
It may turn out that 2019 is more a ‘values election’ than a tactical voting election. Values are why candidates are being weeded out for their anti-semitism or sexism (another Tory went tonight over rape remarks). And with four parties in play in an electoral system designed for two, that’s why this election is so unpredictable. But the real battlegrounds won’t be those 60 seats talked about today, they will be in the midlands and north where most Labour-Tory marginals exist.
Some Labour Leave voters could indeed feel Nigel Farage speaks their language. They would be voting out of conviction rather than merely ‘lending’ their votes. That could gift some seats to the Tories. But as UK in a Changing Europe academic Chris Prosser points out, more Conservative voters are likely to defect to Farage in the first place, helping Labour in other key marginals. ‘It’s a two-horse race!’ bar-chart leaflets and tactical voting websites seem sideshows when voters enter a polling station determined to show everyone a piece of their mind.
Similarly, some Remain Labour voters may feel that the Lib Dems reflect their own values on Brexit (and dislike the general direction of Corbyn’s party) so much that they vote anti-tactically, splitting the progressive vote and letting the Tories win by default in Lab-Con seats. Before any Corbyn supporters condemn such voters, it’s worth remembering that Cameron got his majority in 2015 partly because Labour voters in Lib-Con marginals voted with their gut (many couldn’t stomach the Coalition), slashing the LibDem vote.
For all these reasons, we could end up with an accidental prime minister, whether it’s Boris Johnson or Jeremy Corbyn. That’s why the holy grail in this contest - like all others - remains direct switchers, from Tory to Labour and Labour to Tory.
If Johnson’s winter wooing of the UK is to really pay off, he’ll need to tie the knot with a nervous electorate with a mix of votes lent to him, earned by him and even bought by him. His next marriage will require something old (Brexit party returners), something new (Labour switchers), something borrowed (loadsa extra spending) and something blue (core vote).
Quote Of The Day
“It’s the old adage about if you yank a dog’s tail then don’t be surprised when it bites you.”
One of the remarks by Nick Conrad that yanked him away from a safe Tory seat.
Thursday Cheat Sheet
Nick Conrad, the Tory candidate for a safe seat in Norfolk, stepped down after an outcry over his claim that women were “partially responsible” for sexual assault and they should keep their “knickers on”.
Two Labour candidates were also forced to step down. Gordon contender Kate Ramsden quit after it emerged she had compared Israel to an abused child who becomes an abusive adult. Frances Hoole quit in Edinburgh South after posting an image of SNP rival Joanna Cherry sprayed with bleach.
John McDonnell unveiled plans to shift part of the Treasury to the north, along with £400bn of investment to tackle poverty and the climate emergency.
Sajid Javid promised £100bn of new spending on roads, rail and other infrastructure projects, tearing up Tory fiscale rules in the process. George Osborne warned the plan would lead to higher taxes in the long run.
Boris Johnson made a ‘cast iron’ promise that he would never grant a second Scottish independence referendum even if the SNP won a mandate in the 2021 Holyrood elections.
A new ‘Unite to Remain’ alliance of Lib Dem, Greens and Plaid Cymru unveiled 60 seats where they would step aside for each other.
Former Labour MPs Ian Austin and John Woodcock urged the public to vote Tory to keep Jeremy Corbyn out of Downing Street.
Dawn Butler announced she wanted to run for Labour’s deputy leader post.
Tory George Hollinbery became the 72nd former MP to announce they were standing down.
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