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Saturday 18 April 2009

The Prescription is Written

This week, Pa Broon and the rest of his Cabinet have been on another awayday – this time to Scotland. Indeed, this is the first such meeting north of the border since 1921, during the time of the Lloyd George coalition. I will be returning to the C-word later, but here is another visit to the E-word – that’s as in Economy.

Some of the differences in outlook between the Westminster and Holyrood parliaments were already known – one apparently irreconcilable one being that of new nuclear power stations. But Scotland’s First Minister Alex Salmond had another bone to pick with Pa Broon this week – he’s not keen on upcoming spending cuts, and is worried that this will choke off recovery from recession.

He is right to be worried – but whether the cuts are enough to turn down a recovering economy is not certain: the overall trend is still one of growing overall public spending. Were that trend to be downward, the uncertainty would be ended. And there is now a party advocating just that.

In this news item from the BBC, the Rt Hon Gideon George Oliver Osborne (heir to the seventeenth Baronet) has used the C-word (this time as in Cuts) unequivocally. As the Beeb reports, Osborne has told the Financial Times that spending cuts will be the order of the day, as "You don't want to kill off the recovery with heavy tax rises that bring you back to square one."

Osborne does not mention the clear corollary of these cuts, the inevitable rise in unemployment. Hence he fails to acknowledge that, all things being equal, there will still have to be tax rises, as the tax take will be reduced with less people employed. How this particular circle will be squared is not explained.

But George does want us to know that the Tories want to be honest with the public, even though details of where the cuts will fall have yet to emerge.

And to get into power in the first place, the Tories have to turn a large number of constituencies from red to blue, especially if the Lib Dems hold on to their sixty-odd seats. Unless, that is, they were to try and form some kind of coalition.

And why nobody except the Tories should relish such an opportunity, I will consider later.

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