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By Paul Goodman
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Osborne PenknifeYesterday, Mark Wallace set out in detail on this site George Osborne's patchy record as Chancellor.  Progress on deficit reduction has stalled.  There have been some welcome tax cuts, but little tax simplification.  Big infrastructure decisions have been slow to come, though there may be some good news today about nuclear.  (Patrick McLoughlin takes to this site today to make the case for the money-guzzling HS2 project.)  The proof of the Michael Gove schools and skills pudding will be in the eating, which won't take place for a decade – in other words, until today's generation of children become tomorrow's workers.  Michael Fallon is striving mightily at BIS, but while £4bn of regulatory costs have been
eliminated, £3bn of new costs have been imposed in the last two years.

Indeed, the Chancellor has compromised his original version of a German model for Britain's economy (what Tim Montgomerie called in opposition "a heavy emphasis on economic fundamentals like skills, high-end manufacturing, science investment and regionalism") and is staking his hopes on a good, or rather bad, old-fashioned British housing boom – talking of which, today's papers remind us of the possible consequences for Britain's indebted homeowners when the Bank of England abandons quantitative easing.  Why, then, are the centre-right papers – with the exception of the Sun – positive, on the whole, about yesterday's spending review, which announced a mere £11.5 billion of savings: little more than the total Government spend of well over £700 billion?

I think there are three main answers.  First, because the review will have reminded them that there is no alternative to a Cameron-led Conservative Party as a governing force – when it comes to comparing it with Ed Miliband's unreformed and unready Labour Party, at any rate.  Second, because they will have liked most of Osborne's announcements: the cap on the welfare bill, the requirements to learn English, the seven-day wait before signing on, the end to automatic pay rises for millions of public sector workers.  There will be devils in the detail of some of these plans: I'm curious to know, for example, exactly how they will apply to disability benefits.  But the broad thrust of them is right, and they thus have merit regardless of whether or not they place Ed Balls on the wrong side of a dividing line.

Furthermore, the Chancellor got them past the Liberal Democrats and, in doing so, held out a tantalising glimpse of what a majority Conservative Government – or rather, to be realistic, a second blue-yellow Coalition – might look like after 2015.  Very slowly, imperfectly, but unmistakably all the same, Osborne is striving to shape a Conservative idea of Britain, in which Gordon Brown's client state is, if not rolled back, at least trimmed, and in which the state pension, the NHS, science, the security services, free schools and defence (up to a point) are protected.  Rab Butler once agreed with the suggestion that Anthony Eden was "the best Prime Minister we've got".  The Chancellor is not only "the best Chancellor we've got" but the best political strategist the Conservatives have got.

This is certainly a compliment, but less of one than it seems.  For the fact is that Osborne is the only political strategist the Conservatives have got.  None of his Tory Cabinet colleagues quite fit the bill, at least yet.  Iain Duncan Smith's long crusade for social justice has helped to change the climate of opinion about welfare.  Michael Gove is the Government's most effective reformer to date.  Eric Pickles's achievements at CLG are under-rated.  Theresa May is beginning to spell out her view of what the Conservative Party should be and do.  But none of them have produced a big plan that has put Labour on the back foot – and is helping to change the content of national debate about welfare, immigration, integration and public sector pay in a way that was almost unimaginable until very recently.

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