Ed Balls: My starting point is we are going to have keep all the cuts

Saturday’s Guardian has an interview with Ed Balls:

Ed BalsEd Balls, the shadow chancellor, has moved to challenge accusations that Labour is not credible on the economy by telling the public sector unions that he endorses George Osborne’s public sector pay freeze until the end of the parliament, and that he accepts every spending cut…

“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.”

If Balls and Labour stick to that, this signals a big change in Labour’s approach to opposition.

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32 Comments

  • Colin Green 14th Jan '12 - 8:02am

    So too far, too fast, all necessary. Ed Balls has a credibility issue.

  • Richard Swales 14th Jan '12 - 9:25am

    So he’s now admitting he was a gazillion pounds out with what he said public spending should be last week.

  • Richard Swales 14th Jan '12 - 9:26am

    … yet still has total confidence that he should be Chancellor.

  • Ed Balls is argument has been misrepresented by the above. Simply it is this, “I would like to reverse the cuts but I’m not sure I can because Osborne and the Coalition have screwed the economy.”. This might be true, it might not be, but it simultaneously suggests Labour recognise the problem, are working to get out of it, and blame it on the Coalition. Which is, in strategic terms, a pretty clever maneuver.

    Incidentally, Vince Cable, pre May 2010, was warning that Osborne’s economic strategy would lead to stagnation and problems in recovery. Ed Balls is merely adopting the line favoured by the Liberal Democrats before May 2010. Was Vince Cable wrong?

  • ‘Too far, too fast’ huh Ed? – Think trying to bolster your credibility is ‘Too little, too late’! :-)

  • Labour are u-turning too far too fast, I can’t keep up!

  • Andrew Suffield 14th Jan '12 - 12:30pm

    Surprising nobody, Labour reveals that they’ve just been trying to drum up anger with lies. Who’s “betraying” whom?

  • Are you lot for real? He’s saying the cuts are too far, too fast and have damaged the economy and public finances. But if elected in 2015, or earlier, Labour cannot promise that it can restore all the billions cut.

    Sometimes this is because they’re cuts Labour would have made (less deep and later – so as not to “pull the rug” out from under the economy, to use a pre-election Clegg quote), sometimes just because the cost of restoring them will be unaffordable because of the stagnant economy you’ve helped create.

    Is this hard to understand? Really?? You can disagree with this as policy, but not legitmately with his logic and consistency. #manufacturedoutrage

  • There seems to be a lot of feigned outrage here about Mr Balls’ alleged “U-turn”. I read his comments in the Guardian and he said that, whilst disagreeing with the coalition’s economic approach, given the likely state of the economy in 2015, he cannot make promises about restoring particular cuts. That seems a perfectly sensible stance.

    There is, of course, scope to spend extra money in areas where it is needed by re-directing funds that the coalition is squandering – such as the billions being spent on an NHS re-organisation opposed by the NHS’s own staff, or the dollops of cash Michael Gove is throwing at free schools. As i have said before, “austerity” does not apply when pet projects of the Tory right are concerned.

  • …………………………Ed Balls, the shadow chancellor, has moved to challenge accusations that Labour is not credible on the economy by telling the public sector unions that he endorses George Osborne’s public sector pay freeze until the end of the parliament, and that he accepts every spending cut being imposed by the Conservatives.

    In an interview with the Guardian, Balls said: “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.

    “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. … At this stage, we can make no commitments to reverse any of that, on spending or on tax.”………………….

    The first paragraph is not what he ‘said’ just the Guardian’s spin on it.

    His ‘direct’ quote in the second paragraph takes a sensible stance between the lesser of two evils; unemployment and pay restraint.
    The third paragraph’s direct quote does not endorse the cuts merely, as ‘John’ says, accepts ‘we are where we are’.
    When the ship is way off course there comes a time to just stop saying, “If I’d been in charge we wouldn’t be here” and work with what you’ve got.

  • Andrew Suffield 15th Jan '12 - 12:45am

    sometimes just because the cost of restoring them will be unaffordable because of the stagnant economy you’ve helped create

    So what you’re saying is, it would cost a lot of money and the economy would not benefit by more than the amount of money spent, so it would be a net loss.

    I am glad to hear you condemning everything Labour has been saying to the contrary for the past couple of years.

  • david thorpe 15th Jan '12 - 1:54pm

    so the whole too far too fast matra was tosh then?
    Thats awkward for Lbaour, but also awkward for the very many Lib Dems who endorsed publically Lbaour’s approach to deficit reducion, and npow find Labour dont even endorse it1

    Tribalism should never be a feature of the Lib Dems asa party, but some on what they no doubt call the ‘left’ of our party were being tribal in their backing of Lbaour! and look where it got them!

    Its actually quite hillarious

  • david thorpe

    Did you actually read the article?

    Whilst I think the decision for any opposition to set up hostages to fortune too many years from a GE, I understand why Labour are trying to move forward on this.

    The pace of cuts is too fast but that is the reality and there is nothing any of us who think Osborne is wrong can do about it. The reality will be the situation in 2015 which will be based on the situation at that point and it would be reckless to say now that all the cuts being made can be reversed.

    I do not see how this says the ‘too much too fast’ message is tosh – it is still right in my view but the Chancellor has other ideas and we have to live with his dcisions

    The media at the moment is absolutels hostile to Miliband with all the focus being on him when he is actuially not in any position to do anything – perhaps a little more focus on what the Government is up to would be more useful – but then again Labour-leaning media outlets are very few and far between.

    The LD are basking in the reflected aura of the Tories at the moment so the despicable voting record on the benefits bill last week is hardly mentioned

  • It appears they are not quoting Balls as “accepting” all the cuts, merely putting their spin on it. I guess that’s what journalists do but is probably sloppy language from the actual quotes used over the series of articles which include:

    ” 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.”

    I think there is a difference between accepting cuts and not being able to promise to reverse them. His argument as far as I can see remains that the current policies will leave the country in a worse economic state than those he proposes (albeit any actual solid proposals are hard to find) and that therefore he will be starting in a worse economic situation in 2015 then he would be if slower cuts were pursued.

    He also does not endorse the pay freeze as something that would have been necessary had his policies had been followed:

    “It is true to say public and private sector workers are paying the price for the mistakes of the past 18 months, but we cannot promise higher wages for public sector workers when public spending is tight. When the cost of rising unemployment is pushing up borrowing, we had to make a tough choice.”

    I’m sure anyone with the time to look would be able to find a policy / tax / initiative that was objected to by both Tories and Lib Dems that the coalition now say they cannot reverse because of the economic circumstances. In that Labour are like every other opposition party. Those with a long enough memory will recall a similar tactic from Blair and Brown in the run up to 1997. At that election they promised to stick to Tory spending plans in order to gain economic credibility. I see this as a similar attempt although clearly botched.

    Balls is a massive liability to Labour second only to Millibland, I do not agree with many (in fact most) of his arguments, but the actual quotes from the 3 or 4 web pages on the Guardian site does seem to put his argument in a context the opening paragraph of the most recent one does not.

    There will be plenty of opportunity to attack the credibility of his argument, and a lot of it will be easy to attack, but it should be at least heard in context. Despite what many have said here I do not see this as a retreat from “too far, too fast”. This final quote would appear to suggest this anyway:

    “Even if Osborne took our advice to kickstart the recovery, there are still going to be difficult choices to make. Jobs have to come before higher pay and that is why that restraint on spending and on pay is important for Labour.”

  • Tony Dawson 15th Jan '12 - 6:40pm

    @Steve Way:

    “Jobs have to come before higher pay and that is why that restraint on spending and on pay is important for Labour.””

    Ed Balls is the new Barbara Castle! :-) Plus ca change……..

  • Malcolm Todd 15th Jan '12 - 8:22pm

    So Balls’s argument (and those of his Minitrue interpreters above) seems to run something like this:
    ***
    It’s totally wrong of this government to claim that because they inherited an enormous fiscal deficit and a parlous economic situation that they blamed on the previous government, they had to get that deficit under control as fast as they plan — we would have spent more and taxed less (than even under our own plans up to the election) in order to kickstart the economy.
    However, if we get into government in 2015 and inherit a still enormous deficit and parlous economic situation due to the policies of the current government, we shan’t be able to spend more or tax less since the economy and public finances may not be able to stand it.
    ***
    Have I misunderstood?

  • @Malcolm Todd
    As a Balls plan summary probably not too far from the truth !!!

    My comments were not to support Balls (I think he is so tainted with Brown that even if he talked complete sense I would discount it) but to point out he hasn’t changed his position to accept the rational for the pace of cuts today but an acceptance that he will not be able to reverse them on 2015. Also it is worth drawing parallels to promising to keep to the Tory tax plans in ’97. Economic credibility cost Labour in ’92 and was their focus for floating voters in ’97.

    My preference would be for someone to be arguing the Lib Dem approach prior to the coalition of taking the economic situation into account and adjusting the levels of cuts and spending accordingly, something Osbourne has ruled out.

  • @Tony Dawson
    Ed Balls is the new Barbara Castle!

    One had a principled view of the world and worked hard to achieve it. The other is Ed Balls. No one had to question Barbara Castle too closely to know what her views and policies were, and that earned her respect even from those who opposed her. In fact I think one of her last meaningful political contributions was to attack Balls’ boss Brown over pensions. The world needs more politicians of every ilk like Barbara Castle and far less of the like of Ed Balls…

  • Simon Shaw.. Posted 15th January 2012 at 3:13 pm
    …………..I’m not quite clear. Are you saying that the Guardian and Patrick Wintour, their Political Editor, were lying when they said of Ed Balls “he accepts every spending cut being imposed by the Conservatives.?………….

    I accept, as a fact, every spending cut. Not to accept that they have happened is different to endorsing them which is what you are so desperate to believe he said.

    ….Exactly, and that’s exactly what the Coalition Government has done since Day 1. As a country we should never have been allowed to end up in the position that Labour left us, but as you say, “we are where we are”……..

    Amazingly, right up to the crash the Tories, in opposition, swore to match Labours’ spending; since then, together with a sycophantic media, they have spent two years blaming the situation on Labours’ mismanagement. The whole world is in the same boat so, either there is something wrong with that excuse or Labour were far more powerful than we suspected.

  • David Allen 16th Jan '12 - 1:05am

    Lots of gloating from loyalists. Well, for once I can’t blame you. Labour have made a complete pig’s ear of this.

    Darling had it right. The majority of the cuts had to happen, but Osborne went too far, didn’t do enough for growth, and unfairly loaded the worst cuts onto the poor and disabled. Osborne’s policy failed to reduce the deficit, so it failed in its own terms, because “expansionary fiscal contraction” is even more ludicrous than “neo-classical endogenous growth theory”.

    We should now seek a plan C which is neither pure Osborne plan A nor the overambitious reversal of Compass’s plan B. Since Darling has gone to the back-benches, and Cable seems to have gone even further away from the debate, there is now nobody to put a decent rational alternative forward.

  • Simon Shaw……. Posted 15th January 2012 at 11:37 pm…………….You may believe that Labour are blameless. Your problem is that 68% of the British public disagree with you……

    I said, “The whole world is in the same boat so, either there is something wrong with that excuse”…That does not mean I believe Labour, as the government, was blameless. However, neither do I believe that, as you seem only too eager to believe, that it was ‘all their fault’.
    Fiscal Regulation failed….However, would any other party (without the advantage of hindsight) been any better.
    Public Spending…..Both LibDems and Tory were promising to spend the same.
    Personal Debt…With interest rates at an all-time low and banks throwing money around like confetti, the only way to have curbed lending would have been a massive, artificial rise in interest rates by the Bank of England. Who, at the time, proposed that?

    The main reason for the financial meltdown was the, supposedly self-regulating ‘free-market system’…

  • …………………is Labour’s claim that they carry none of the blame………….

    I don’t remember any Labour spokesperson claiming that.

    I voted Labour in 1997 (before and after LibDem;) my differences with Labour’s approach, like LibDem policy at the time, was not fiscal. However, with hindsight, it is easy to throw adjectives, like “irresponsible”, about. You stated, “As a country we should never have been allowed to end up in the position that Labour left us.”
    In my last post I mentioned three domestic reasons that left the UK vulnerable to the world crisis. Which party would have acted differently? Blaming Labour ‘because they were in power’ is only half the answer; the word ‘opposition’ implies speaking against, not promising to match, or even exceed, the policies which are now being blamed.

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