The Contradiction within Cameron's Economic Logic ; the Prime Minister's Hasty Revision of His Conference Speech Has Highlighted a Deeper Problem with Policy
Hilton, Anthony, The Evening Standard (London, England)
[broken bar] AVID Cameron became the bookies' favourite to lead the Tory party when he spoke without notes for 20 minutes to the 2005 party conference in Blackpool. It was a virtuoso performance which catapulted him from third in the race to front runner; thereafter he never lost the lead. So it is not without irony that at this year's party conference in Manchester the Prime Minister should be tripped up, not by an unscripted remark, but by one which was only too visible in black and white. Parts of his speech were released to the press early to get some favourable overnight headlines -- taking a leaf from the news management techniques perfected by Tony Blair. But the plan backfired when the media seized on a paragraph which urged people to pay down their credit cards -- and thereby do their bit to ease Britain's debt burden.
Unfortunately that "advice" coincided with news that the nation's growth rate has been revised down to a barely visible 0.1 per cent in the three months to June. Worse, and suggesting it has not got any better since, the pain on the high street was underlined by even the mighty Tesco saying it is as tough out there today as it has been in 20 years.
So Cameron's comment -- if he had gone ahead and made it as intended -- could not have come at a worse time. Encouraging the nation to spend even less risked, at best, appearing remarkably insensitive to how squeezed many households already are and how little money there is out there in the hands of either the nation or its shopkeepers. At worst, it looks economically illiterate.
However necessary and desirable paying off debt might be in the medium term, now is not the time. Bankruptcies in the retail sector are already running at the highest level this century and several household names are rumoured to be so close to the edge that any further slump in sales could easily tip them over.
That would give another mighty knock to business confidence which is already painfully fragile and would probably cause the economy to slow down even more.
So the offending paragraph was rewritten, the command to cut was surgically removed, and his media minders cobbled together a flimsy cover story about the speech being an early draft. President Nixon's aides when caught out with an untruth during Watergate used to say: "That statement is no longer operative." They were more believable.
Unfortunately it matters, because the change of tone is more than just a gaffe, which the media loves and nobody else remembers for more than five minutes.
In fact it points to an inconsistency at the heart of Government policy. In deciding not to urge people to cut their debts, Cameron is openly acknowledging the risks a further cut in spending could do to the economy.
But if that is true for individuals paying down their credit cards then it is also surely true for government. A spending cut is a spending cut, whoever is responsible …
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Publication information: Article title: The Contradiction within Cameron's Economic Logic ; the Prime Minister's Hasty Revision of His Conference Speech Has Highlighted a Deeper Problem with Policy. Contributors: Hilton, Anthony - Author. Newspaper title: The Evening Standard (London, England). Publication date: October 6, 2011. Page number: 14. © Not available. Provided by ProQuest LLC. All Rights Reserved.
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