PMQs: banks, boom and bust

There have been some interesting shifts in position at PMQs over the Christmas break.

In the latter half of last year, Clegg was continuously met with Brown’s stock reply that the Liberal Democrats wanted to “cut £20bn in spending” [sic]. This required him to either let the point pass or waste his second question in pointing out that as much of the saved £20bn as was necessary would be spent on Liberal Democrat policy priorities. And the latter did no good at all because Brown simply repeated the accusation.

That particular paper umbrella of Brown’s seems to have blown away, not before time, in order that he can accuse the Conservatives of being “the only party to propose cuts in public spending”. He said that twice today.

Even more interesting, I noticed Brown stealing at least one Conservative policy over the break – incentives for businesses hiring people who had been redundant for over six months – and expected the first PMQs back to signal a kicking for that, as it duly did. Cameron also claimed (“He has announced a pell imitation of our jobs scheme and a pell imitation of our business loans scheme”. It really would help his case if he tried to talk like a human being. It’s not even posh. I’m posh. He’s just weird.) that Brown has stolen today’s announcement of the Business Guarantee Scheme. I wasn’t aware of this as a Tory idea but I’ll leave someone to correct me.

One thing that hasn’t changed: Cameron’s initial line of attack. His first question yet again asked the Prime Minister to acknowledge that he had not abolished the boom and bust cycle. I don’t know where he thinks he’s going with this idea. The impression it gives is even more snotty schoolboy (“Admit it! Admit it! I’ll tell Matron!”) than usual, and he starts off at a considerable disadvantage on that score.

Pinched policies, recycled lines. It’s a depressing little short circuit of the imagination we’re witnessing between the two bigger parties. Clegg’s first question did a good job of reducing the ins and outs of the Business Guarantee Scheme to a common sense level. He asked why the taxpayer, having shelled out £37bn to get the banks lending again, should now be asked to stump up a further £10bn to do apparently the exact same thing. It was Brown’s job to make the £37bn work, not give up and sign away more taxpayer money to do the job himself.

This makes good liberal sense as a question, pointing out the taxpayer’s position as the ultimate forker-out for government plans, whether they’re in the form of a bank bail-out or something which includes the word “Scheme”.

The solution, Clegg proposed in his second question, is to close the loop. Stop incentivising the banks to both lend and hoard at the same time, in fact stop incentivising them at all, and instead use taxpayer money to lend through a state bank under government control.

Clegg and Cable are banking (ha!) on the state bank eventually becoming the only option in much the same way nationalisation of Northern Rock was, and they may well be right. It makes sense to look at the sudden flurry of government schemes that way – if it’s the taxpayer paying then at least make your control of the system overt from the outset.

It’s economic pragmatism, and purist economic liberals will find it difficult to stomach. I suspect we should bear in mind that the same pragmatism brought us to the redistributive tax package and the eventual cuts indicated by Make it Happen.

Most depressing moment of the session: Brown responding to a Cameron question with talk of pensions and child benefit and claiming Cameron would cut the services “on which the British people depend”.

They actually want the British people to be dependent on them. It’s an emotionally needy organism, a Labour government. If it was a human being it would be in co-dependent relationship therapy.

Full text of the session, as usual, to follow.

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  • Yes, it’s nice to see that Brown has stopped saying we would cut spending. But he hasn’t done that because the facts have changed. He’s done it because he now thinks it’s more important to him to paint the Tories as being isolated.

    Genuinely good to see Clegg taking the pragmatic line on state controlled banking. The voters won’t want ideology, whether pro- or anti- statist, when we’re all in this mess.

  • “Most depressing moment of the session: Brown responding to a Cameron question with talk of pensions and child benefit and claiming Cameron would cut the services “on which the British people depend”.

    They actually want the British people to be dependent on them. …”

    You object to the idea of the elderly depending on pensions? Perhaps you think they should “get a job”?

  • “Far better for the economy would be for everyone to be financially independent of government.”

    Oh, certainly it would be jolly nice if everyone had independent means!

    But at the risk of dragging you bright young things back to the real world, a lot of people do rely on the state pension, and a lot of people do think they have a right to a decent state pension, having paid their dues all their lives.

  • Anon,
    I think you misunderstand our position.
    We agree with you about the state pension and want it increased substantially – AND NOT by means tested additions. If that means better off pensioners getting an increase as well as the poorest then so be it. The tax system will reduce any excesses

    BTW – I don’t want to hear any more spin from govt that we can’t afford decent pensions. The banking crisis has revealed to us all just how big the economy of the UK is , compared with the ‘pensions shortfall’

  • David Allen 14th Jan '09 - 6:44pm

    “They actually want the British people to be dependent on them. It’s an emotionally needy organism, a Labour government.”

    Well, there’s something in that. Labour are, indeed, rather too desperate to be loved.

    However… Whilst we often do promote markets and free enterprise, we also, of course, need the State for many things. As Anon indicates, most people don’t want to see the return of the workhouse. Or rule by criminal gangsters, in the absence of a state police force. Or hospitals that will turn you away to die if you can’t pay. Etcetera.

    How would we want a Lib Dem government, and what it would deliver, to be regarded by the populace? Loved? Hated? Ignored?

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