Why the Coalition shouldn’t oversell the CSR
Thankfully, I wasn’t in Number Ten when the decision to invade Iraq was made. Whatever anyone thinks of the war (and we will have the report of the Chilcot Inquiry in the New Year), there is not much doubt that the process of decision making and communication leading up to the decision were deeply flawed. In particular, informed opinion and advice against the invasion was too easily dismissed, the case for the war overstated and the responsibility to develop a contingency plan for things going wrong shirked. As I have argued in the past, while these failings may be merely regrettable in the context of conventional domestic policy decisions, they are much, much more serious when facing the momentous decision to go to war.
What made me think about this again was the controversy over next week’s comprehensive spending review. I am not for a moment arguing that the detailed and nuanced decisions made in the CSR are comparable to the yes or no of going to war. Nor, even in the worst case scenario, does anyone think another economic downturn in the UK would generate the level of human suffering that has occurred since the Iraq invasion.
However, the decision to take a hard line on deficit reduction is a very big call. As far as I can tell, it is opposed by a majority of economists and if it is wrong it could significantly worsen the state of the economy and damage the livelihood of millions of people in the UK. More than that, if the economy does slump, it will be counter-productive: the lost revenues as a result of slowdown would probably be greater than the difference between the Coalition’s fast reduction approach and the last Government’s more gradual (although still very painful) plan. We could end up with deeper cuts and a bigger deficit.
Whatever my past tribal loyalties, I hope the decision turns out to be right. David Cameron, George Osborne and Nick Clegg all speak powerfully about the need to lower the deficit. As the Prime Minister said last week in his conference speech, Labour’s deficit reduction plan would mean the UK continuing to have a rising stock of debt (and rising interest payments) far into the future. That we are this year spending more on debt repayment than on the NHS is hard to stomach. But the fact remains that many serious, politically-neutral experts (for example Anatole Kaletsky in the Times this morning) say the scale of spending reduction planned could be a huge mistake.
The understandable temptation for the Coalition facing so much opposition to its plan is both to make its case as forcefully and unconditionally as possible and to create a culture in and around Government that dares not either question the plan or explore contingencies if it doesn’t work. But this would be bad Government and bad politics. Instead, Coalition leaders should be allowing dissenting voices to be heard, showing that they know the risks they are taking and have a credible and responsible plan for changing course if things go wrong (another massive failure of the Iraq process). Chris Huhne has adopted something of this tone but he seems to be alone.
In the last few days we have seen a great deal of evidence (on house prices, on retail sales and on manufacturing output) of economic slowdown. This may not be sufficient to change the policy but must surely alter the balance of the debate. If the CSR does go wrong and there is an inquest, we will want to know that the Chancellor and his team were looking at the evidence right up to the last minute not closing their minds to uncomfortable facts.
As I say, the Prime Minister and his colleagues make a powerful economic and political case for radical deficit reduction. But even last week George Osborne was guilty of some creativity with his facts (for example, overstating the proportion of UK debt which is held abroad). These rhetorical flourishes will not look good if the policy fails and people suffer.
So, in the interest of informed and balanced public discourse (something the RSA always seeks to promote) and in the political interests of ministers making brave but risky decisions I hope the next few days will see a change of tone from ministers. Instead of trying to convince us that radical deficit reduction is right come what may we need to hear the Coalition acknowledging that the argument is finely balanced, the risks real and that there must be a plan B if a double dip looms.
A few words about TB …
Some RSA Fellows think I take on every opportunity I can to pursue media appearances, regardless of whether they are good for the Society. So I am keen to report that I have turned down at least half a dozen invitations to comment on my former Boss’ appearance at the Iraq Inquiry.
I will stay off the airways. But, for what it’s worth, here are my very brief reflections on what – between meetings – I have managed to watch today. Some people may think it is inappropriate for me to comment at all, but it is the issue of the day and relevant to many of the debates about democracy and policy which we regularly host here at the RSA.
TB was highly unlikely to say anything new. He made his case as well as could be expected and he spoke with clarity and conviction. What he said was important not just for the historical record but in relation to current foreign policy and security challenges.
Overall, the picture painted by TB tallies with that of other witnesses, including those who are less inclined to take responsibility for the war. There is little evidence of a conspiracy or a cover up. On the strategy, legality, planning, the different views are there for people to see and to judge for themselves. Indeed not a great deal has changed since 2005 when Iraq hurt TB’s standing but not so much that he failed to win the general election..
TB was visibly tense at the beginning of the hearing and very focussed throughout. This was for real. I couldn’t help wondering how many other countries would have put a former leader through such a public interrogation (and how many former Prime Minister’s of the UK would have been willing to be questioned in this way)
The outcome, I suspect, will be that those who hate TB will continue to hate him, or maybe even hate him more because they will feel he has ‘got away with it’ again. In contrast, those who used to like TB may be reminded of why they did and what they miss about him as a leader.
On the lead up to the war itself my view (and, as I was not in Downing Street I have no greater claim to insight than any other observer) is that I trust TB’s motives. But I also think there were failures of governance. Methods of communication, persuasion and decision making acceptable for major domestic policy decisions were on occasions applied to the very different matter of a highly contentious and risky military conflict.
I’m not sure whether if things had been done differently the decisions or outcomes would have changed. What might have done is the level of suspicion and hostility that TB faces not just now, but quite possibly for the rest of his public life.
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