If the Lib Dems had won in 2015

In May 2015 I was a callow and energetic parliamentary candidate, motivating myself with the daydream, but not the expectation, of what the UK would look like in two years if the Liberal Democrats won an overall majority in the general election.

Nick Clegg was Prime Minister and Vince Cable was shopping for a new briefcase as the first Liberal chancellor of the the 21st century.

Even my far more modest hopes for the result of the 2015 were dashed, eight seats in parliament and several excellent liberals cast from it left me as devastated as Paddy Ashdown’s hat must have felt.

There is a fashion for counter-factual history, so let us ponder what might have happened if my boyish daydreams had come to fruition.

Well naturally we would not now be facing the spectre of Brexit, the House of Lords would be on the road to real reform, and a voting system more representative of the views of the voter would be pacicking Tory and Labour strategists.

As for the economy, well financial markets hate uncertainty above all else, so the announcement of Prime Minister Clegg would have sent sterling into a tailspin as soon as markets opened in 2015. The inflation that causes would be impacting the economy right about now, and inflation would be higher because Chancellor Cable would (rightly) have lifted the public sector pay cap and increased government spending, delivering a boost to UK GDP growth.

With Chancellor Cable at the helm, many companies in the financial services sector would be muttering darkly about leaving for more business friendlyî climes, though debate would rage about the extent to which politicians should listen to the threats of elites such as international bankers.

The much higher inflation resulting from higher wages and a weaker currency would dent the consumption portion of UK economic growth, while sterling’s downward spiral would have boosted exporters.

The economy would, in other words, be moving away from debt funded consumer led growth and towards a model where exports and manufacturing form a greater part of GDP.

The overall level of GDP growth would be lower than it was before 2015, as the fall in consumption (which is around 66 per cent of GDP) would not be fully compensated for an improved outlook for areas that contribute less to GDP.

The growth forecasts of Osborneís pre-election budget in 2015 were ludicrous in their optimism, so Chancellor Cable would have been sensibly revising them downwards, just as Hammond has had to do.

So two years of Liberal Democrat overall majority government in 2017 and the economy would look a lot like it does right now, funny that.

The economic impacts of Brexit are unlikely to be positive over the medium to long term, but, one has to wonder, if it is at all as bad as it seems right now?

* David Thorpe was the Liberal Democrat Prospective Parliamentary Candidate for East Ham in the 2015 General Election

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9 Comments

  • For fear of posting something that might be construed as abusive, I’ll stick with “?”

  • One big difference: we’d have (I hope) at least mitigated, if not ended completely, a lot of tory benefit “reforms”. So a lot less people would be dead.

  • “Fewer”. But yes.
    And a lot fewer of the living would be depressed and desperate, not knowing how to survive the delay between benefits being cut off and (not guaranteed) successful appeal against arbitrary decisions based (so we all suspect) on meeting quotas rather than helping people who need it. Or even listening to what they say before declaring someone fit for work and cutting off their DLA or PIP allowance.

  • This is an interesting analysis. However there is a need to include the possible actions of hundreds of new Liberal Democrat MPs. They would be the ones who would in fact decide how to react to the problems which the country would face. We need to consider in particular a new cabinet and new ministers outside the cabinet. Most with no experience of Parliament. It would indeed be interesting.

  • “If the Lib Dems had won in 2015”, would we have had more or less knighthoods ?

  • Richard Easter 6th Jan '18 - 7:29pm

    Given that Clegg took speaking fees from international elite bankers, I’d wonder just how much of an enemy of them, he really is…

  • Laurence Cox 6th Jan '18 - 7:45pm

    Mark Pack’s Newswire article “What if Chris Huhne had beaten Nick Clegg to the Lib Dem leadership in 2007?” in the January 2018 issue is worth reading as a piece of alternative history although, strangely, the events which caused his political demise never happened in this alternative timeline.

  • david thorpe 7th Jan '18 - 6:47pm

    thanks for the comments.

    i take the point about benefot reform.

    i dont understand the point about knighthoods, we have given far less deserving of gongs peerages, mr clegg got a knighthood on the basis that he led the third largest party in parlaiment and was deputy prime minister, his immediate predesesors in both of those roles got gongs.
    i was being sarcastic in my point about bankers, ie, the CURRENT LIb dem policy is one that suits bankers.

  • david thorpe 7th Jan '18 - 10:23pm

    no party that is pro eu is really an enemy of international finance, as the eu allows for the free movement of capital, which is precisely the business model of international banks.

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