Heads will roll if Team Cam doesn't sell austerity

Written by Andrew Hawkins on 27 June 2012 in Opinion
If the coalition doesn’t sell the austerity package, David Cameron could face a cold dawn come 2015, says Andrew Hawkins

This article is from the July issue of Total Politics

Nicolas Sarkozy’s ejection as French president merely marked the latest political backlash against European politicians who get entangled in the economic crisis.

The list of previous casualties is long and distinguished, and while not all of these lost office solely because of their adherence to austerity, in each defeat the economic crisis was decisive.

In May 2010, Gordon Brown lost his first general election as prime minister as Britain totted up its biggest budget deficit, due in part to a deeply unpopular bailout of two of the nation’s largest banks.

In 2011, many European leaders fell, including a humiliated Brian Cowen of the Republic of Ireland’s Fianna Fail, which in February got hammered for its handling of the economic crisis, and Portuguese prime minister José Socrates, who resigned in March after Portugal’s parliament rejected austerity measures.

The same year saw the resignations of Finnish PM Mari Kiviniemi, whose coalition lost parliamentary elections in June, Slovenian prime minister Borut Pahor – he lost a confidence vote amidst economic and political turmoil (September) – and Slovakian prime minister Iveta Radičova, who also lost a confidence vote (October) over the eurozone bailout.

November was a hard month for much-beleaguered Greek premier George Papandreou as the country sank further into the economic abyss, while Silvio Berlusconi finally surrendered office as the Italian government’s ability to fund its debt evaporated. The last month of 2011 saw José Zapatero lose the Spanish parliamentary elections and quit when unemployment topped 20 per cent.

Most recent was the political demise of Dutch PM Mark Rutte, forced to call new elections in April after failing to win support for budget cuts. The obvious question, therefore, is the likely impact of the economic crisis on the 2015 UK general election.

Public tolerance of economic hardship is like accepting overseas military action. People accept sacrifice when there’s an obvious and real threat, when the pain is seen to be working, and when there’s a winnable end in sight.

On these criteria, it remains to be seen whether the Conservatives can achieve their goal of an outright election win in 2015 after 23 years without one.

The coalition faces two obvious problems, and a further, less obvious one.

Problem number one is that the coalition has staked its credibility on tackling the deficit and growing the economy. Even without the eurozone crisis, with all that means for the UK, it’s difficult to see how the message “we delivered what we promised” will stick in 2015.

As Andrew Haldenby of Reform points out, the planned debt to GDP ratio will still be 80 per cent, which, in perspective, is “twice as high as in the Gordon Brown years”.

Furthermore, the UK economy is in double dip for the first time since the 1970s, while countries like France and Germany are not.

The polls suggest that the voting public is losing patience with the government’s economic handling.

It’s to the government’s relief, no doubt, that Eds Miliband and Balls have also suffered a loss of confidence, but that’s hardly a positive endorsement of the government’s reassurances that it knows what it’s doing – see the graph on the opposite page.

Problem number two is the omni-shambles that undermines the general claim of competence: “If I can’t trust the government to manage public fears over petrol shortages, why should I trust it on anything else?”

It also risks making MPs appear harsh and uncaring: increasing taxes for older people is not smart politics when pensioners are three times more likely than 20-year-olds to vote. This, unhelpfully, has coincided with some very public reminders of the type of people David Cameron and George Osborne like to surround themselves with.

The less obvious but potentially equally devastating factor is that voters may look to the terms of political debate in countries such as France and conclude that austerity is more of a lifestyle choice than an economic imperative.

If I can ‘choose’ my preferred brand of austerity – perhaps one with a capital ‘A’, or ‘austerity-lite’ – why hasten the agony?

Given the appalling state of the deficit even at the end of this Parliament, and the likely positioning of the main parties on the economy then, the coalition will face the real possibility that voters will opt for a softer message.

They were once prepared to take a hit to put things right, but may well reject the scale and speed of the remedy.

To return to the ‘overseas military action’ analogy: the performance of the UK economy and our failure to control the debt tell people that the medicine is not working.

If the French and others can get away with a softer approach to debt reduction, is the scale of the threat as bad as it’s made out to be?

If the eurozone goes down in flames and the UK economy gets singed in the process, it will only serve to increase the likelihood that prime minister Cameron may join the list of European leaders punished for being in the wrong place at the wrong time.

Tags: Andrew Hawkins, European leaders, Eurozone, Issue 49, Polling

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