Beware thin ice and thick ideas
Posted by Fraser at 9 41 PM on Saturday, December 12
ALISTAIR Darling doesn’t pick fights for the sake of it.
So why is he telling the world about his “tensions” with Gordon Brown?
The Chancellor wanted to jack up VAT to 20 per cent next month — and is proud of it. The Prime Minister rejected it. What’s going on?
I’ll tell you my hunch. That Darling fears we’re heading for a SECOND crisis and wants to make clear he did his best to avoid it.
I’ve listened to many budget statements in my time. And last week’s Pre- Budget Report was easily the weirdest.
Darling’s delivery had all the sincerity of a hostage reading a scripted statement. It’s his way of saying: “This isn’t my idea”.
Soon after the Budget, the stories flew around. Prime Minister and Chancellor are fighting tooth-and-nail about the future of UK plc.
Darling wants to axe an extension of the expensive (and, in my view, pointless) identity card system. He admits this freely.
He wants to stop the insane tax on jobs, which is the surest way to stifle a recovery. But Brown overruled him.
Darling was dead against a bank windfall tax, saying it would chase the fat cats (and their taxes) out of Britain. Here, he actually won.
I met him the day after the Budget, at a Treasury drinks party. He looked strangely calm, and quietly confident. He openly admits to his “healthy tensions” with Gordo – and “sometimes, unhealthy tensions.” What’s more, he doesn’t care who knows it.
So much for the idea of Darling as a tartan pussycat who will meekly obey whichever orders clansman Brown barks at him.
The rift is over Brown’s addiction to spending. Darling wants to break it, knowing it’s cursing a generation with debt. The budget small print shows we’re borrowing £242 BILLION this year. Debt interest is already higher than education or defence bills.
Dubai went pear-shaped last month. Greece was downgraded this week. And make no mistake: Britain is next on the critical list.
Economists are starting to fear a nightmare scenario: that Britain’s credit card is torn up as we’re force to go cold turkey. According to the debt markets, Britain is now judged more likely to go bust than McDonald’s. Or Gap. Or Vodafone.
When quarterpounders are seen as a safer bet than pounds, you know things might turn nasty. And without any warning.
I’m told that, inside the Treasury, Darling puts it thus: “You only know the ice is too thin when you fall through it.”
Last week, he was pleading with Gordon Brown not to jump on this ice. Brown thinks: At least Cameron will fall in too.
But so might the rest of us. This SECOND crash could be much worse.
There would be no deficits, no safety nets. Just cold, harsh cuts.
In 10 Downing Street, Brown is surrounded by Tory- hating apparatchiks who think only of an election they’ll all soon lose.
He knows that, after next May, he’ll be taking a Tiger Woods-style “indefinite break” from politics. In the Treasury, Darling is surrounded by civil servants who know THEY will have to clean up the mess.
They want to start now.
So this rift is here to stay. The Treasury is slowly asserting itself. Preparing for the worst. Thinking of tomorrow.
And thinking of the second crash, which might not be too far away.
FRASER NELSON is also Editor of The Spectator.