Thursday, July 23, 2015

George Osborne: the master tactician

Since the "omnishambles" of the 2012 budget, Osborne has become a master of using them for ruthlessly-efficient political purposes. From the "Wonga budget" of 2013, to the even more cynically-minded budget of last year, Osborne demonstrates repeatedly how he uses his control of the nation's economy to mastermind the control of the allegiance of the key segments of society he needs to retain power. This is both a complement and a damnation. It has nothing to do with economics, and everything to do with power. As the author wrote previously, Gideon Osborne is the "master of the dark arts" - the political Lord Voldemort of Westminster, with his hand behind every key decision made in government, relishing in his notoriety.

Since the (unexpected) Conservative victory in the election, it has given Osborne more freedom than had been planned for. It also made the severe swathe of cuts predicted before the election more difficult to administer, with no LibDems there to take the credit for making the cuts more politically-viable (and saving the Conservatives' frugal insanity from themselves). So what would he do?

The Machiavellian trickster

In many respects. Osborne is a terrible economist. It's now long-forgotten that Osborne's original plan when arriving at the Treasury in 2010 was to cut the deficit in one parliament. In the election campaign of that year, he opposed Alastair Darling's plan of doing the same over the period of two parliaments. Then, after two years of following his own plan and seeing that the economy was going from bad to worse, Osborne then decided to follow Darling's plan after all, and carry on as if nothing had changed. The Conservatives had spent their time in government rubbishing Labour and using snappy (if factually inaccurate) soundbites ("don't hand back the keys to the guys who crashed the car"; "paying down the debt that Labout racked up" etc. etc.). So Labour were left on the defensive and had no time to regroup and attack Osborne's blatant, massive policy U-turn.

This theme has continued through Osborne's tenure: whenever Labour came within a sniff of seriously damaging the government, Osborne was able to deflect attention elsewhere. While austerity has been the theme of the government, Osborne has implemented it in such a disproportionate and inconsistent way that it is hard to know where to see a common theme or economic purpose. While some departments face cuts of 40%, the largest outlays of all - pensions, the NHS. and education - are hardly affected at all in real terms. Likewise. while Osborne originally intended before election to have most of the cuts achieved within the first two years of this parliament, now they will be stretched out longer, to just shy of the next election, lessening the appearance of the impact. It is as clear as day to see that the real purpose of this strategy is to smooth things for "the succession", and the expected period of grace before the 2020 election that Cameron would give his successor (i.e. Osborne) to settle in.

Osborne is really enjoying himself these days, as he twists the knife into the open wound that is the post-election Labour party. With the benefit of hindsight, his electoral strategy looks to have been "destroy the Labour party, then steal their best ideas". Before the election, the Conservatives rubbished many of Labour's ideas as left-wing nonsense. Now, Osborne takes some of them as his own, such as the introduction of the "living wage". Paid for by the abolition of tax credits for many families, this is (according to the IFS) nothing less than an enormous fiddle, and one where the sums do not add up, leaving the working poor massively out of pocket. But again, Osborne the trickster has created another illusion, and one for the Labour party to work themselves into knots over.

Like the Conservative Party he represents, Osborne has few real principles that can't be sacrificed if it will help retain power. This is why he has been at times so hard to pin down in terms of real political consistency While the Conservative Party represents the establishment, it will bend over backwards and back to front to defends its self-interest. Osborne is the perfect example of this. What matters is what works for the Conservatives: if that means calling a Labour policy "Marxist" one month, then adopting it themselves the next, so be it. This is what keeps Labour on the back foot, always wondering where the next "trap" will come from. This is what makes Osborne a master at the political dark arts, even within his own party.

Divide and rule

So now the Machiavellian trickster models himself as the "workers' champion". The claim that the Conservatives are the true "workers' party" is a bold one, which requires some expansion. This goes back to another of Osborne's tactics: divide and rule.

The chancellor coined the expression "strivers versus skivers" a few years ago, as a way of explaining the economy. This is, in reality, a very old right-wing theme, where the "earners" are being used to support the "loafers" in society. It has simply been updated using 21st century terminology: it is the classic politics of Ayn Rand and her perspective of individualism and morality.
But is it a con, of course. Dividing the working poor against the unemployed poor helps neither: both are poor, for different reasons. This is simply a political tactic. And in the election, it worked.

Also, Osborne recognises who is most likely to vote at elections, and gears his economic and electoral strategy (in reality, the same thing) around them. In the UK, the older you are, the more likely you are to vote (and also, vote Conservative). It is for this reason why pensions are protected (triple-locked) and why the "help-to-buy" scheme is expanded, yet while there is no control applied to property prices, resulting in year-on-year the increasing unaffordability of housing.
But also it is the reason why tuition fees are extended (to fatten the budgets of the universities); why support for young people is cut back; and why there is no help to give young people genuine skills (a low-skill economy is also a low-wage economy i.e. better for employers). The "recovery" may not be benefitting those under thirty at all, but when they don't vote, who cares what they think? Fundamentally, this is the cynical calculation at the back of Osborne's mind.

Meanwhile, the Labour party is caught in a "triangulation" trap, where it doesn't know where to look to get its lost voters. Seen objectively, Osborne is a terrible economist, storing up problems that will only get worse with time: the low-skill nature of the economy post-2008; the housing crisis; increasingly unaffordable pensions etc. etc.

But Osborne seems to have little regard for this: his focus is only on "the prize"...

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