Iain Martin is the Editor of Cap X, and author of Making It Happen: Fred Goodwin, RBS and the Men who Blew Up the British Economy.
I keep trying to tune out of domestic British politics and assured myself that I would after the General Election excitement. I’ve got a book to deliver on another subject – although even the history of that period keeps taking me back to the politics of the Thatcher era – and as the writers on CapX show, there’s a big wide world out there. I’ll also be writing more about the US next year.
But damn, UK politics continues to be captivating viewing, and getting more so by the week. It should not be this way. The Conservatives won a famous election victory and the next election is not for four and a half years. The situation should be becalmed and it isn’t.
For a start, the looming EU referendum is going to be an absolute thriller with a lot at stake. No, really, it is. Remember when otherwise smart people said that the Scottish referendum had been dragging on too long and it was getting boring? Look what happened in the last month of that campaign and in the chaotic aftermath since.
Post-devolution British affairs now also operate according to an altered cycle. There is always an important-ish election coming up somewhere, in Scotland, Wales, London, or for Europe, meaning the parties have to function more or less non-stop, rather than building towards irregular national elections, a process which was punctuated by the odd by-election scramble or policy review.
And then there is Labour under Jeremy Corbyn. Oh, Labour, what are you doing? Stop it, stop it, stop it, for the sake of British democracy, which needs a credible opposition. But my goodness what you’re doing is fascinating, in a car crash sense of the word.
For all those reasons, politics right now is always “on”.
In such a febrile context, anyone billed as frontrunner in the Tory leadership stakes in a contest that is three or four years away has a problem. The frontrunner – never a good place to be in Tory leadership races, anyway – is not the place to be until the final stretch.
George Osborne, who loves the game, has positioned himself as the front-runner brilliantly. Indeed, perhaps he has positioned himself too brilliantly, too early.
I’m one of those who has criticised the Chancellor in the past – as far back as 2007-2008 for not getting off the Brownite consensus – but he has grown in office and built a formidable machine. It is easier for those who are natural show-offs to prosper in politics. Osborne is not the creature of caricature. He is thoughtful, witty and well-read. And he has had to work hard at being in the frontline, building an excellent team while honing his thinking and his message.
This rebuilding process, after the Omnishambles budget of 2012, was so successful that after the election victory in May, Osborne was elevated to the status of Tory leader in-waiting. Boris had a torrid summer. His mayoralty is ending with a whimper. Tory MPs were sceptical of his appeal. And Osborne controls much of Whitehall with a cadre of loyalists in key positions. Osborne was up, it was said, and Boris was down and possibly even out.
The story of the last month, however, is of Osborne’s rapid decline.
1) While his conference speech in Manchester was fine, it looked too calculating and aimed at the leadership race. Boris’s speech was even more calculating, of course, but he has a gift for making an audience overlook it because they are enjoying themselves too much.
2) Tax credits. Osborne’s changes, to the in work credit that tops up the pay of the low-paid, are under heavy fire. Yet, if the Chancellor compromises, and scales back his cuts, it could look as though he has given in to pressure from Corbyn and from Boris. That’s a tough retreat to have to make but there is no point mistaking stubbornness for ideological bravery. Best, in the circumstances, to find a way of mitigating the changes in the Autumn statement. In the interim, every day of criticism reinforces the negatives of brand Osborne.
3) Kowtowing to the Chinese. Of course we have to trade with China, and it is going to be especially vital for the City of London, but do we have to be quite so shameless and pathetic about it? Osborne is the architect of the UK’s China policy, and has made sure that everyone knows it. Now, the optics of this state visit, as viewed on television news, look increasingly like a national humiliation.
4) The EU campaign is going badly. It is not impossible that Cameron and Osborne could switch to backing Out, although it is highly unlikely. As it is, as of now they are the dominant force in the In/Remain effort. Either way, the government’s renegotiation is a mess and the In campaign is in trouble, with only a narrow poll lead at a point when the status quo should be miles ahead. Osborne has to end up on the winning side, somehow. If not impossible, it is going to be tricky.
The turnaround in fortunes is so quick these days that a battle-hardened Osborne could well recover. Six months ago in the UK seems like a distant, weird world in which Nick Clegg, Ed Miliband, Ed Balls and Natalie Bennett were on the television. All gone. Not dead, but frozen in time in another era. In a year it could all change again in Osborne’s favour, and the autumn of 2015 might be forgotten.
Still, as As Gideon Rachman of the FT put it on Twitter yesterday, for now it looks as though we have just experienced “peak Osborne.” The Chancellor’s stock is falling.
This article first appeared on CapX.