The alternative

Prime Minister David Cameron pursues his plan to fix the battered British economy with austerity, his main foil in the debate over how deeply to cut government spending will be Ed Miliband, the young, untested leader of the opposition Labour Party. Mr. Miliband is an unlikely standard-bearer in the global debate over how best to pull nations out of economic doldrums. One of the loudest arguments in that debate came Wednesday, when the U.K. laid out £81 billion ($127 billion) in budget cuts over the next four years—the latest European government to demonstrate a belief that recovery will be built on austerity measures and a balanced budget.Mr. Miliband is among those counter-arguing that slashing spending will sap demand and forestall a fragile economic recovery. “This is a global economic battle and people will be citing the U.K. around the world. So Ed Miliband has to stand up and say, ‘There is an alternative”‘ to steep cuts, said Joseph Stiglitz, a Columbia University professor and winner of the Nobel Prize for economics. But Mr. Miliband may disappoint anyone expecting him to fully torpedo Mr. Cameron’s plan. Unlike the Obama administration in the U.S., which continues to look at ways to prime the economy with government intervention, Mr. Miliband has less room to take such a position. – Wall Street Journal

In an outline of the basic foundations of the party’s alternative to the coalition’s record £83 billion in spending cuts, Mr Johnson said investment would be a more effective way of reducing the £155 billion national deficit and producing economic growth. Radical plans to make banks pay a £7.5 billion levy towards a “push for growth” are contained in the broad strategy. It was the first time since the 2009 Budget that Labour’s official policy has focused on investment as part of the solution to the current crisis. Mr Johnson accused the Government of “taking a huge gamble with growth and jobs” but in a radio interview said that the threat of a “double-dip” recession may yet be averted. – Tribune

Broken Promises

Both Mr Cameron and Mr Clegg ate humble pie before the audience. Mr Cameron acknowledged that he had gone back on an election pledge not to cut child benefit. “I had to eat those words. But is it right to go on asking people on £15,000, £20,000 or £25,000 a year to keep paying so that Nick and me and [Labour leader] Ed Miliband can go on getting child benefit?” On the decision to sharply increase tuition fees for university students from 2012, when they will double in most cases and, perhaps, more than double, Mr Clegg, whose party has longed wanted their abolition, said: “It’s one of the most difficult things I’ve ever had to do – to own up to pledging things I now feel I cannot deliver.” In a bid to shore up support among Liberal Democrat MPs and supporters, Danny Alexander, the party’s chief secretary to the treasury, wrote to party members, saying: “We have made the tougher choice, no doubt, but we should be proud of the way we have taken responsibility and we have done the right thing.” – Irish Times

David Cameron and Nick Clegg today expressed regret for breaking election pledges when they faced an audience at a question-and-answer session in the aftermath of the government’s spending cuts announcement. The prime minister admitted he had to “eat his words” over child benefit, under questioning from audience members who were angry that both parties had reneged on promises made before the election. Clegg said he felt “really bad” when asked by a sixth-former about his U-turn on tuition fees. – Guardian

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The Spending Review

Margaret Thatcher is lying sick in a private hospital bed in Belgravia but her political children have just pushed her agenda further and harder and deeper than she ever dreamed of. When was the last time Britain’s public spending was slashed by more than 20 per cent? Not in my mother’s lifetime. Not even in my grandmother’s lifetime. No, it was in 1918, when a Conservative-Liberal coalition said the best response to a global economic crisis was to rapidly pay off this country’s debts. The result? Unemployment soared from 6 per cent to 19 per cent, and the country’s economy collapsed so severely that they lost all ability to pay their bills and the debt actually rose from 114 per cent to 180 per cent. “History doesn’t repeat itself,” Mark Twain said, “but it does rhyme.” George Osborne has just gambled your future on an extreme economic theory that has failed whenever and wherever it has been tried. – The Independent

Butcher George Osborne’s brutal £81billion attack is unfair and avoidable. Yet Conservative MPs celebrated the job losses, cheered the austerity. This is, as Labour’s Alan Johnson neatly put it, an ideological moment. David Cameron’s deficit deceivers are using debt as cover to slash and burn their way across Britain.Cut-crazy Ireland’s reeling from a double-dip recession, France is going up in flames. The backlash here will not be pretty when people feel Osborne’s crude blade. On a national level unemployment will soar, half a million sacked in public services with accountants warning as many again could go in private firms. Economic growth will be choked and could go into reverse. And on a personal level we will all suffer with the most vulnerable paying the highest price. – The Mirror

The Commons was raucous, and Johnson made much of the sight of Tory MPs waving their order papers – apparently with excitement – during Osborne’s announcement. He said: “Members opposite are cheering the deepest cuts in public expenditure that have taken place in living memory. For many of them, this is what they came into politics for.” Johnson made light of the fact that, during the last comprehensive spending review in 2007, Osborne had supported Labour’s spending plans until after the scale of the credit crunch became apparent “well after the collapse of Lehman Brothers in America set off a disastrous chain reaction around the world”. The Liberal Democrats, he said, had changed position on whether cuts would be justified this year between the ballot box closing and the door of the ministerial car opening. – The Guardian

The government’s great triumph so far has been to portray anyone who opposes their plans as moronic. True, there are a few winners of the Nobel Prize for economics and other lowlifes against them, but they’re just foreigners. The British seem to have bought into the whole thing. Hit us. We deserve it. Just as long as you hit our enemies harder: the banks, the bureaucrats, the quangos, the MPs, the workshy. They were all duly sandbagged. We seem to be in one of those brief periods when the sceptical British have suspended disbelief, as they did before the Iraq war and every time England ever play in an international football tournament. The government’s grip on the politics tightened on Wednesday. In contrast to last week, Mr Cameron was in fine, patronising form and wiped the floor with a verbose and hesitant Ed Miliband at the question time session before the cuts statement. – The FT

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“Cash driven” defence review

Mr Cameron denied the review was simply a “cost-saving exercise”, saying it was instead a “step change in the way we protect this country’s security interests” But Mr Miliband told MPs it was a “complete shambles”. “It is a spending review dressed up as a defence review, it has been chaotically conducted, it has been hastily prepared and it is simply not credible as a strategic blueprint for our future defence needs,” he said. In the House of Lords, those criticisms were repeated by Lord Boyce, who was chief of the defence staff from 2001 to 2003. “I cannot say I welcome the statement on this cash-driven defence review and I certainly can’t possibly dignify it with the word ‘strategic’,” he said. “It will be viewed with dismay by our hardworking and operationally oppressed sailors, marines, soldiers and airmen.” – The BBC

AN MP has accused the Government of “playing politics with national security” and putting jobs at risk after delays to the Trident successor programme were announced yesterday. Barrow and Furness MP John Woodcock spoke out after prime minister David Cameron announced the replacement for the Vanguard submarines would not come into service until 2028 – a delay of four years. In the Commons, Mr Woodcock challenged the prime minister over the cost of the delay. He said: “The prime minister reassured the people of Furness that he was committed to replacing Trident – but this delay will generate unnecessary worry and uncertainty for workers in Barrow shipyard and the many businesses whose future depends on the prosperity the yard generates. “Instead of showing leadership in the long-term interests of the country, Mr Cameron has bowed to pressure from within his government and kicked Trident into the long grass. But playing politics with Britain’s national security like this puts jobs here at risk and will cost the taxpayer far more overall.” – The North West Evening Mail

Shadow defence secretary Jim Murphy described the arrangement as “peculiar” and “driven by finance”. He told the BBC: “What’s the purpose of an aircraft carrier if not to carry aircraft? And I think to leave our country without a single fixed-wing aircraft able to fly off our aircraft carriers for a decade is a very worrying decision. “It can’t be driven by security needs or strategic needs. No-one based on the security needs of our country would come to the decision that a decade without an aeroplane on an aircraft carrier is the right decision.” – The BBC

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