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Hammond’s programme differs from Osborne only by degree

16045157947_266ff71d05_bCompare and contrast. A confident figure seizing the moment and pledging a radical remaking of Britain. Yes, Theresa May looked formidable on the steps of Downing Street in July. She had stolen Labour’s 2015 Manifesto and she was going to get away with it. Wind the film forward to November, and her chancellor gets up and lays out a programme that differs from his predecessor’s by degree, not kind. And it comes covered in the Prime Minister’s ultra-cautious thumb prints.

Let’s grab at “call me” Philip Hammond’s headline figures. Borrowing is going up by £122bn as he abandoned Osborne’s arbitrary budget surplus. Instead, that aim has been kicked into the long grass, like many of May’s other “priorities”. It’s as if Hammond has just heard tell of Alastair Darling’s deficit reduction plan from 2010. It also means the debt is set to soar to £1.9tn, partly because of the economic consequences of Brexit (what are those guarantees government will be throwing at big business to keep them in Britain?), and partly because of their uselessness these last six years. Unfortunately for Hammond, the debt-free option that was available to Osborne, of printing money, can’t offer a way out as Brexit is getting the blame for inflationary pressures on household goods. An opportunity was squandered for a people’s quantitative easing approach as the printing presses shovelled funny money to the banks, which in turn has helped another asset bubble take off.

As the British economy is a tremulous beast prone to tailspin every time someone criticises it, can we soothe the poor dear and take any positives from Hammond’s statement? Well, letting fees are gone. You know, one of Labour’s policies the Tories had previously decried as communism. Another victory for our ineffective opposition. There’s to be a modest splurge on roads, superfast broadband, and 40,000 extra housing units. All welcome, but not enough. The minimum wage (it’s not a living wage no matter how much you repeat it) is due for a 30p increase, and there’s to be no more savings from social security. That is, at least until after the current planned round of cuts go through.

Unlike Dave and Osborne who would loudly proclaim they were going to do stupid things and went ahead and did them, May and Hammond have gone for the old over-promising and under-delivering trick. Whereas the previous pair’s bravado was usually reflected in favourable media coverage, the first batch of hot takes from the hovering commentmongers were lukewarm as Hammond plodded his way through, following yet another insipid PMQs performance. This wasn’t the statement of a government preparing to go to the country. It’s one concerned at keeping policy issues as non-controversial as possible while it muddles its way through Brexit. Politically, it might be just enough for the time being, but for how long?

5 Comments

  1. Paul Dias says:

    Still no article on the conviction of Jo Cox’s murderer.

    Still no article, still no comments.

  2. Verity says:

    We should welcome any investment in infrastructure, particularly as John Mc D.’s investment plans would take more than the five years to show the returns required to meet increased current expenditure needs. Any investments made now would benefit the next administration rather than this one. Companies paying their share of corporation tax could have reasonable expectations for infrastructural support and also in training costs to compensate for not absorbing the rest of the world’s trained/expert staff.

    There is increasing Labour demands for increased current expenditure in so many areas that it would still be a challenge to meet all those needs following a Labour election victory. Of course we hope to do better on tax evasion/avoidance. Of course we would demand full and substantial corporation tax payments. Of course we might look to ‘some’ savings on an alternative/reduced Trident plans. Of course we would seek tax contributions from capital gains/inheritance tax. Of course we should expect higher contributions for £150,000+ (?) higher income earners, But I still suspect we still need some imaginative programmes to meet many of the expectations we raise in so many areas of current expenditure which we currently classify as suffering from austerity. All our plans are dependent upon a growth that has a lag in its effects.

  3. Bazza says:

    Mmmn the Undertaker is just Osborne Mark 2.
    Conning working class/working people.
    Have to laugh at Mediocre Osborne & his Northern Powerhouse rhetoric after what cutting billions from Northern Labour Councils but little from Tory Southern Councils.
    See Mediocre May’s Masgue of Pandora is off – penalising children of illegal immigrants – the Tory Party as the Nasty Party lives!
    But the majority of people voted for Brexit which we need to respect.
    So people have voted to leave the capitalist EC club but some still want the benefits of membership for free (access to the free market).
    We may need to pay though the nose for this but perhaps could argue for the 3 C’s.
    Capitalist access to the free market (Pay to Stay!)
    Control of capital.
    Control of Labour.

  4. Bazza says:

    The first C of the above was taking the mickey!
    And within the parameters of a left wing democratic socialist society with state-led public investment and democratic public ownership (with staff and communities having a say) of: banks, land, mail, rail, pharmaceuticals, public utilities, some airlines, and free public transport.
    I keep singing a paraphrase of an old rock song: “It’s a crazy, crazy, crazy, World!”
    It is the labour of the working billions which creates the wealth and makes societies and the rich an powerful capitalists and their allies legally steal our surplus labour so we need left wing democratic socialist parties in every country of the World including the US, China and Russia who all try to bully the World for the power of their Ologarchs.
    And against the religious barbarians like so-called IS.
    All of the major powers are surrounding each other with weapons of mass destruction to protect profit – the true little people of the World!
    Ours is not populism but the liberation of working humanity.
    Yours in international solidarity.

  5. David Pavett says:

    It may well be true that Hammond’s economics differs from Osborne’s only by degree but what is completely unclear from this article is what a difference of kind would look like and if Labour has one on offer.

    I can make little sense out of

    Unfortunately for Hammond, the debt-free option that was available to Osborne, of printing money, can’t offer a way out as Brexit is getting the blame for inflationary pressures on household goods.

    Besides, Hammond said in a recent interview in New York

    I approved a round of quantitative easing back at the beginning of August as a response to the shock that the economy had felt, but we are conscious of the impacts that QE has and we will use it carefully and cautiously…

    My overall impression is that Phil B-C has no idea what would constitute an economic policy differing in kind from the current one – or if he does he is not letting us into the secret.

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