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Its the Economy stupid...

The Conservatives are living in hope and in fear.

They hope that the tide of incompetence and sleaze that previously engulfed the Major government will similarly engulf Gordon Brown. They hope that the more personable image of David Cameron will allow him to do what his three predecessors, William Hague, Iain Duncan Smith and Michael Howard, could not and lead the Tories to victory.

Yet still, the Conservatives fear that their hoped for victory could still be taken away from them.

The opinion polls are quite volatile, and given the vagaries of our electoral system, it could still be that the Conservatives get comfortably the largest number of votes and yet not be the largest party in the House of Commons. The Tories need a substantial lead, simply to break-even. Since the Tories still support the first-past-the-post system it is -frankly- their problem and they get no sympathy from me for their predicament. The problem is that the run of polls is such that the Conservatives could be able to obtain a workable majority or end up just tantalisingly short of a majority in a hung Parliament -and the mathematics are such that it is extremely difficult at certain levels of support to see which way the results will break.

Yet how can it be that the leading opposition party can even doubt that they will defeat a government that is so clearly past its sell-by date? After all, the meltdown of the whole ten year Labour economic policy, combined with continuing sagas of waste and incompetence are now being spiced with stories of personal cupidity and sleaze that have clearly discredited the entire administration.

Although the Conservatives have recently maintained a lead in the polls that would allow them to gain a working majority, a frisson of fear continues in Tory circles- for their support is still very shallow. The public reaction to Cameron at this stage in his leadership is distinctly tepid when compared with Tony Blair at the same phase in his leadership of Labour.

To a degree one might suggest that the Conservative attempt to take the battle onto traditional Labour issue areas: health and education was the major success of Cameron's leadership. However it has also exposed an unexpected Conservative flank to attack from an unexpected quarter.

Given the direct responsibility that Gordon Brown has had over the past twelve years for the economy and therefore for the catalogue of economic policy mistakes that he has committed, the Conservatives might have felt confident that as far as these critical issues were concerned, then electoral support would run firmly in their direction.

Not So.

The fact is that the Liberal Democrats finance spokesman, Vince Cable, has turned the Tory flank. His expertise, based on being a professional economist, has been so great that he has been treated less as a party spokesman than as an expert witness- the to anguished frustration of Conservative commentators like Iain Dale. Yet the fact is that Dr. Cable -yes he even has a PhD in Economics- has shown up Conservative economic policy to be just as much empty rhetoric as the policies of the government.

At this time of economic crisis to lose the critical advantage of greater trust on economic policy is at best extremely unsettling for the Conservatives, at worst it could indeed cost them the chance of a majority at the next election.

The fact is that, head-to-head, it is perfectly obvious that George Osborne is absolutely no match for Vince Cable. Many erstwhile Conservatives have expressed the clear view that they think that Cable should be the finance minister, even were the Conservatives to win the election. Ian Hislop, not an aggressively partisan figure, has publicly said that he would prefer to vote for the "Vince Cable for Chancellor" Party. Leaving aside the fact that there is such a party already- the Liberal Democrats- there is no doubt that, even on Conservative benches, George Osborne is not liked or respected.

In 2005 the Liberal Democrats gained a swing of 3.7% to 22.1% of the vote and won ten more seats for a total of 62 seats. In 1997 they won 52 seats on only 18.3% of the vote. Yet, 2005 aside, the Liberal Democrats typically gain votes over the course of an election campaign. In 1983 and 1987 they entered the campaign in the teens but were still able to gain 25.4% and 22.3% of the vote respectively (though far fewer seats than at present owing once again to our strange electoral system.)

Thus the fact that the Liberal Democrats are now consistently back to the high teens, even occasionally into the 20s must surely be giving the Conservatives real pause. With the problems of the Liberal Democrat leadership now addressed, the media narrative, as far as the Liberal Democrats are concerned is focused on the immense asset of Vince Cable's obvious expertise and the sorry contrast that George Osborne makes (Alistair Darling is weaker too, but his problems are masked by the gravitas of office).

The Conservative strategists know that elections are won or lost on the economy. They are also not used to facing a real fight from Liberal Democrats on those issues, because their traditional strategy of rubbishing the relevance of the Party or pretending, as Iain Dale does in his piece, that the Liberal Democrats are *really* some kind of closet Socialists, usually works.

However this is where the risk that David Cameron has taken now becomes obvious. He cannot credibly attack Liberal Democrat policies while at the same time putting forward more expensive, more traditionally left wing policies himself. Especially not while facing Vince Cable who is trusted by the waiting press and can explain precisely what the Tories are trying to do in terms simple enough for journalists to understand.

No wonder the Tories are afraid.

We are already seeing a concerted attempt by Conservative commentators to denigrate Vince Cable. it is not going to work, simply because Vince is Vince. He so consistently warned of the predicament the economy was facing- long before it was fashionable. He has been lucid and clear, because he genuinely understands the issues, in a way that only a lifetime as an academic economist, rather than as a boy politician, allows you to do. At the same time he is also able to convey his understanding in a way that trumps the glibness of his opponents. It will be practically impossible to change the positive electoral perception of Cable, because it is so firmly rooted in the truth.

We are now less than one year away from opening of the next election campaign. As the Labour government continues to decay, the focus on the Liberal Democrats is likely to increase. As the media discovers that Vince Cable is not the only talent on the Liberal Democrat benches and the Cameroons lose their novelty, then we could be looking at a further recovery in Liberal Democrat polling levels- at the perfect time to lead to an increase in the vote and the number of seats that the party can win in 2010.

The Liberal Democrats, thanks to Vince Cable, are having a good economic crisis. As the Tories view the next election with increasingly mixed emotions, the Liberal Democrats can increasingly look forward to the General Election with real hope.

The next year could end up as one of the best in Liberal Democrat history.

Comments

Anonymous said…
It could also finish up as one of the worst, such are the vagaries of politics!
Paul Wakeford said…
The electoral problem for the Tories is the Labour Rotten Borough set up in Scotland and the inner cities in England. This is gerrymandering by Labour by keeping its eyes shut on the inequalities. I noticed when the Tories started to make noises about this problem, Labour members warned about Gerrymandering. I see no ships!
Brom said…
The Tories are such a joke! They've shown themselves to be completely hapless on basically every single major policy issue.

Look at their recent dilemmas over the economy, over Europe, over MPs expenses, over health. The Lib Dems have been the only party to set out concrete, coherent alternatives to the government on these issues. The latest Conservative hero is a man who wants to dismantle the NHS, let the economy collapse even more than it already has done and take Britain out of the EU.

And whadda y'know the Tories have 10%+ lead in the polls!
Anonymous said…
"They are also not used to facing a real fight from Liberal Democrats on those issues, because their traditional strategy of rubbishing the relevance of the Party or pretending, as Iain Dale does in his piece, that the Liberal Democrats are *really* some kind of closet Socialists, usually works."

But how can you deny that there are great swaithes within your party who are indeed socialists.

Vince himself, (though he accurately warned of the credit bubble, and 10/10 for that) resorts to Socialist ideology for the remedy, viz, Keynesian economics, nationalization of banks etc.

I sincerely would like to support the LibDems on libertarian grounds, but it IS the socialist left of your party that scares me off.
Newmania said…
I feel Vince Cable has been over praised but I cannot ,in any case, see why you are so against the Conservative Party.
Anonymous said…
The Liberal Democrats are doomed - DOOMED!
Cicero said…
Well, yes our comedy electoral system can deliver an unexpected whoopie cushion to any party- regardless of their level of support. The boundry commission would ne unnessary if we had fair votes, but the sunk cost of gerrymandering remains to tempt those who enter power, even if in opposition they support fair votes- not of course a criticism I can level at the Conservatives.

The only reason that Vince Cable wants to nationalise the banks is because otherwise the tax payers gain nothing from the risk they are taking- he says repeatedly that he would privatise the banks as fast as possible, once the work out has been completed- and that ain't the Socialist style...

Newmania, I am not per se anti Conservative- I just think they would make as bad a Horlicks of things as Labour and don't feel inclined to give them the benefit of the doubt. Time to change the system of government at least as much as the party of government.

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