David Gauke is a former Justice Secretary, and was an independent candidate in South-West Hertfordshire at the recent general election.
For reasons that some readers will understand, the departure of Dominic Cummings from Downing Street was not a source of great sorrow for me. It appears that I am not alone. Nonetheless, Cummings’ resignation/dismissal makes the Prime Minister’s job much harder in at least one respect.
We are already pushing the limits on when a free trade agreement with the EU can be agreed in order for it to be in place by the end of the year. Boris Johnson continues to appear to be undecided as to whether he is willing to make the necessary concessions in order to get a deal (thus upsetting hardline Brexiteers) or leave without a deal (wreaking further damage to the economy and the integrity of the United Kingdom).
Both options have been apparent for some time, and they are sub-optimal for the Prime Minister and the country. Now he really has to choose.
If he compromises, some people will say that, without Cummings, the Prime Minister lacks a spine. Cummings may well be one of the people making this point.
If he does not get a deal, the Prime Minister’s strategy must be to convince the Leave half of the country that the ensuing mess is the fault of the European Union (it will be a hopeless task to avoid the blame with the other half of the country). To do that, he will need a communications strategy that is ruthless, aggressive and lacking in self-doubt, entirely untroubled by the overwhelming evidence pointing to a different interpretation of the situation. These are exactly the circumstances in which Cummings has a track record of success.
This is a bad time for the Prime Minister to fall out with his most influential adviser.
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Anyone entering politics will be aware that there may come a moment when there is a conflict between what one perceives as the national interest and the furtherance of one’s career.
We can currently see this playing out in the United States, as Donald Trump continues to refuse to accept the election result. With a few honourable exceptions, most senior Republicans have gone along with this nonsense. Presumably, none of them believe the election was rigged in favour of Joe Biden, but they dare not say so because of the fear of offending the Republic base.
Although not as egregious, there are similarities in the UK. Fear of offending the Conservative grassroots has inhibited too many senior Tories in setting out the realities of our departure from the European Union for far too long.
At this particular time, the talk of Westminster and Whitehall is that the overwhelming majority of the Cabinet favour a compromise with the EU because they are conscious of the consequences of failing to get a deal. But the ambitious amongst them know that to be seen to be associated with compromise on Brexit is a career damaging move.
As a consequence, they keep their heads down, content to let others challenge the prejudices of their party’s more extreme supporters. If things ultimately go as badly as they might, history will not judge kindly.
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The Prime Minister’s announcement of an ambitious green agenda will, we are told, help create thousands of green jobs. The increase in defence spending will, we are told, help create 10,000 new jobs. Such announcements are always treated as being good news – a further justification for a policy.
There are good arguments to be made for reducing carbon emissions and improving our defence capabilities but, while the fact that pursuing these policies requires the employment of more people may be good news for the individuals concerned, for the Government and society as a whole, this is a cost not a benefit. Employing people is expensive. And if they are employed to do one thing, they are no longer available to be employed to do something else which society or the economy might value.
I do not always agree with everything Nigel Lawson says, but he has a point when he states that “a programme to erect statues of Boris in every town and village in the land would also ‘create jobs’ but that doesn’t make it a sensible thing to do”.
To give an equally absurd example, it is not a cause of celebration that, from January, the country is going to require an additional 50,000 customs agents because of increased bureaucracy involved in trading with the EU. I repeat, this is a cost not a benefit.
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Wednesday will see the Spending Review, albeit one that is less comprehensive than first intended. I suspect much of the focus will be on the Office for Budget Responsibility’s assessment of the public finances, which is likely to be ghastly.
Borrowing this year will certainly be a peacetime record and might not be far behind a wartime record, either. To some extent, that does not matter as much as it might do – we can get our debt away easily and cheaply enough in a world where markets are much more forgiving of high levels of Government debt than they were even a few years ago.
But the worry will be that, even a few years down the line when the virus is behind us, we will still be borrowing very large sums of money. Exceptional borrowing in an exceptional year is one thing, but one cannot expect to get away with that forever.
Something will have to be done – but when? One of the many challenges for the Chancellor is that the political and economic cycles are misaligned.
Politically, he would want to get tax rises or spending cuts (and it will be mainly the former) in place early in a Parliament so that the pain is well out the way by the time we get to 2024.
Economically, the consensus view is that early tax increases might choke off a recovery so better wait a while. On that basis, even with the recent good news on vaccines, 2022 would be the earliest point for tax increases (and plenty would argue for later).
The politics of tax increases also appears to be immensely difficult. The Prime Minister seems dug in on the tax lock (preventing increases in the rates of income tax, national insurance contributions and VAT, which between them raise two thirds of Government revenue) whilst the back benchers also appear squeamish about any kind of fiscal consolidation.
As a country, we have given ourselves a bit of a holiday from thinking about the public finances. This coming week might indicate that this holiday will soon be coming to an end.
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Should we relax Covid-19 restrictions to save Christmas? It would be lovely to have a normal Christmas, but I am not sure proponents of seasonal break in restrictions have thought this through.
There is every reason to believe that Christmas would be a super spreader event, resulting in the deaths of thousands just weeks before we will have vaccinated the vulnerable.
For too many families, making the wrong decision about Christmas 2020 could mean that all future Christmases will be tinged with sadness, loss and guilt. Just be patient; we are nearly there.