Lost Horizon

Last Thursday Nicholas Clegg had his head in the clouds and seemed to be promising heaven on earth.  He was, together with Danny Alexander, holding a LibDem press conference at the Shangri-La hotel on the 52nd floor of the Shard skyscraper in London.  We can only imagine their purpose in choosing this unusual venue at the highest building in Europe that is also the biggest green-house in the world. With its panoramic view of the City (financial capital of the world) through glass walls there must have been a subliminal message about occupying the commanding heights of the economy.  In Lost Horizon, Shangri-La is the mythical valley in the High Himalayas, a sanctuary where the environment is conducive to well-being and a pro-longed life.  Another subliminal message about the LibDem green credentials and better standard of living?

Any message about their plans for the economy – tax rises and budget cuts – was lost in the mist surrounding the top of the Shard that obscured the view of the City = a lost horizon.  The news media were more interested in asking Clegg about the opinion poll that indicated he was going to lose his Sheffield Hallam seat in May = a lost message.

Visitors pre-booking a ride to the observation platform in the Shard are promised a free ticket for another day if the view is obscured.  Reports that he will be repeating the exercise when a better weather forecast is received have been dismissed as pure speculation.  He could open proceedings with a rendering of the Johnny Nash classic; “I can see clearly now the rain is gone, I can see all obstacles in my way, Gone are the dark clouds that had me blind, Its gonna be a bright bright Sun-Shiny day”.

The Leader of the Liberal Democrats is known as Calamity Clegg for a reason.  He didn’t even get to the top of the Shard’s 87th level, and he is not going to get anywhere near the top in next May’s ballot.  The party campaign slogan is – Stronger Economy, Fairer Society – but the way he is presenting their plans is more like the fairy-tale about the three bears.  The Tory porridge  is too hot, the Labour porridge is too cold, but baby bear’s porridge is just right.  He accused Cameron of being cruel to the poor, and Miliband of wanting to put bills on the never-never.

This strategy started with Clegg’s new year message.  His first point was a question; who can finish the job of sorting out the economy and do so fairly?  Second; you are not going to get the answer from Labour and the Tories; Labour heading off to the left and still no answers about how they would look after our money; Tories hareing off to the right with austerity for ever without end.   Third; you are not going to get an answer from rag-bag of other parties who will make an absolute mess of the next parliament.  His conclusion; only the LibDems emerge as the answer to the nation’s problems and can sort out the difficult things in the economy, but can do it with compassion and fairness.  He was full of beans and keen to get out there.  So he arrived at the Shard.

As they say, a week is a long time in politics; so it is possible that his words have already been forgotten.  He promised to bring an end to austerity in three years time while protecting public services and the most vulnerable in society.  Eliminate the budget deficit by 2017 and criticised Tories for wanting to do it only through cuts.  He wants to reduce the pace of cuts and hike taxes by £8bn aimed at the rich.  This would mean a ratio of 40% tax rises : 60% spending cuts.  The economy was back on track and there was light at the end of the tunnel, so let us finish the job.

Yes, his speech was laden with cliché, including ‘back on track’ and ‘light at the end of the tunnel’, which I warned you about two posts ago – that is, don’t believe politicians using this terminology because they are clueless and short-sighted.  From now on Nick will be known as Clueless Calamity Clegg.  And by the way, his figures don’t add up and his timescale is on central European time.  The LibDem ratio proposes cuts of £12bn, making an overall package of £20bn, which won’t cut the mustard, leading commentators to speculate that CCC is using a starting point of 2010 not 2015.

Back to April 2010, when the Labour Government had an annual budget deficit of £163bn and all the main parties promised to reduce the deficit by half [to £81.5bn] by 2015.  The forecast for this financial year is a £95bn deficit, but next months budget will confirm the actual figure.  The Institute for Financial Studies warned that voters were being deceived about the huge tax rises and spending cuts needed after the election, with none of the main parties coming clean about how they would tackle the record state deficit.  The IFS said, “Repairing the public finances will be the defining task of the next government.  For voters to make an informed choice, parties need to set out clearly how they would go about it.  Unfortunately they have not.  The blame for this lies primarily with the current [Labour] Government’s refusal to conduct a spending review before the election.”

In 2015 the LibDems cannot plead ignorance because Danny Alexander was also at the Shard, and he is Chief Secretary at the Treasury.  Not only does he have access to the books, he can cook the books.  In 2010 the LibDem proposal was for green taxes – aimed at polluters – with 29% tax increases : 71% spending cuts, or in real money £19.7bn tax increases : £46.4bn spending cuts.  The figures didn’t add up then either.  They were proposing a package of £66.1bn to reduce the annual deficit by £81.5bn.  It was never going to work and their 2015 proposal will not either.  They won’t achieve a budget surplus in the next parliament.  And remember, the budget deficit does not include the Royal Mail pensions transfer or the asset purchase facility.

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