Ed Balls comes out... as a Conservative

An astonishing interview in The Guardian, where Shadow Chancellor Ed Balls - appears to sign up to Coalition economic policy.  Here is what he had to say:

On Public Sector Pay:
"It is now inevitable that public sector pay restraint will have to continue through this parliament. Labour cannot duck that reality and won't. There is no way we should be arguing for higher pay when the choice is between higher pay and bringing unemployment down."

On Cuts:
"My starting point is, I am afraid, we are going to have keep all these cuts. There is a big squeeze happening on budgets across the piece. The squeeze on defence spending, for instance, is £15bn by 2015. We are going to have to start from that being the baseline. At this stage, we can make no commitments to reverse any of that, on spending or on tax. So I am being absolutely clear about that".

Mr Balls also suggests that Labour will soon come up with "tough decisions" on welfare and waste.

After months of opposition, the Labour Party appear to have conceded defeat.  Their previous policy of campaigning against every Coalition 'cut', looks to have been consigned to the dustbin.  Perhaps it is because of the unpopularity of Ed Milliband, perhaps a realisation that the public no longer trust Labour on the economy - especially after Gordon Brown's virtual bankrupting of the country.

Whatever the reason, I think Coalition Ministers will be able to sleep safer in their beds in future.

by Robert Halfon - www.roberthalfon.blogspot.com

Labour and cuts

It is so easy for the Labour Party at present. Difficult decisions made by the Coalition Government - on welfare, higher education, local government and policing - can be opposed as 'wicked cuts' detrimental to public services. Much simpler to express outrage against Coalition plans to cut the deficit. Much harder for the Government to explain why paying £120 million a day in debt interest alone is unsustainable in the long term. Not least because all this debt repayment could otherwise be spent on public services.

Whereas cuts are immediate and real, dealing with debt - even if the economy is almost bankrupt - is much more abstract.

Yet, Labour's easy short term political gain might not be so clever in the long term. If after months and years of undergoing the political pain of cuts, the economy improves, with the debt and deficit reduced, the Labour Party could significantly suffer in the polls. By 2014, if the Coalition can announce lower taxes as well as more money for reformed public services, they will reap the electoral dividend.

To be fair, not all senior Labour politicians are so short-sighted. Douglas Alexander MP (one of Gordon Brown's top Lieutenants), has argued that Labour lost the election because they simply denied that cuts were necessary. Through their language and rhetoric, they came over to the public as 'deficit-deniers' rather than economic realists. In a recent speech he stated:

"As I argued within government at the time and as I still believe today, the repeated refusal by some to use the word "cuts" for many months after the global financial crisis and the repetition of phrases like 'Mr 10%' gravely damaged voters' confidence that we got it,".

Mr Alexander's honesty is refreshing. He needs to pass his message on to his colleagues on the Labour benches, if his party is to regain economic credibility.

P.S. You can read more HERE: http://www.guardian.co.uk/politics/2010/nov/30/labour-gordon-brown-cuts-douglas-alexander?
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