Gary Gibbon has produced a very succinct and perceptive summary of the challenge facing the UK, which I would recommend having a look at. Before he's even stood up to deliver his autumn statement, it's clear that the Chancellor isn't going to be able to eliminate the debt by the end of this Parliament, and more cuts are going to be required. The OECD and the Office for Budget Responsibility (OBR) have downgraded their forecasts. Whatever your political outlook, this is a day heavy on the doom and gloom.
Big set-piece economic occasions like today's autumn statement or a Budget are usually all about the Treasury and the Chancellor. On the surface, today will appear to be no different. But in actual fact, today is really about Ed Balls. As Oliver pointed out earlier, we already know most of what Osborne is going to say because of the extent to which his statement has been leaked to the press over the past week. In fact, this has happened so much that there's a good chance Osborne will be rebuked by the Speaker for it. Osborne's team have been saying for months that the OBR forecast will be downgraded. While obviously this doesn't make the bad news better, it means that our eyes might just wander across the despatch box to where the shadow chancellor stands.
Balls' message is all about optimism. As he told Amber and I in our interview with him in this month's magazine, in his opinion, part of the reason the UK is in this situation is because of the coalition's doom-laden approach:
"That hit to confidence last autumn, why did that happen? Partly because Cameron and Osborne told everybody how bad things were. I don’t see why we should take lectures from a prime minister and chancellor who did nothing but talk the economy down all through last year. They’re partly reaping the consequences of that."
The shadow chancellor claims that he's already made a start on trying to rekindle some optimism in his conference speech earlier this autumn. He's absolutely adamant that "It’s possible to change course in a way that’s credible but that gets the economy moving and more hope and optimism."
The natural impulse of an opposition politician is to tear down the government's arguments. Today, Balls can't afford to be negative - if he is, he risks contradicting his own insistance on optimism as an intrinsic part of the an economic recovery. In addition, the shadow chancellor was clear with us that while the coalition was enjoying their post-election bounce, there was "no way" his message could get through. Ever since he took over the Treasury portfolio, he's been aware that his message could have only a limited impact, as he told us: "for most of this year, it was hard for us to be heard because everybody thought it was going to work. Why discuss the alternative?"
Until now. Can Balls demonstrate that optimistic opposition on the economy is possible? With the news that the deficit will not be eliminated by the 2015 election and more cuts are likely, it's more important than ever that Labour present themselves as a viable alternative on the economy. Balls needs to start that campaign today.
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