Listening to George Osborne’s autumn statement over a picnic lunch at my desk today I was struck by the thought that there was a lot of window dressing and deck-chair arranging going on. Wonderful as the Brown-esque [thanks, Olly] tinkerings were, the main message that I took from the statement was that the economic future of the UK wasn’t really in the Chancellor’s hands, if it ever really had been.
Instead, the UK is part of a global economic system that’s currently looking less than tip-top. From the on-going risk of eurozone defaults and even break-up (witness Italy paying almost 8% on 3yr bonds this morning), to the US’ inability to address its own deficit, and the unwillingness of China and others to step into the breach, there’s little to make one feel that there’s a dependable base upon which to rebuild the British economy. And of these, it is the eurozone that looms largest, given British exposure.
Which raises the question of why the British government isn’t trying to do more to help their counterparts do more to stop the current downward spiral. To stand on the sidelines and shout for solutions, while simultaneously refusing to contribute any resources, unsurprisingly comes across as arrogant and unconstructive. A eurozone default would make today’s adjustments to meeting Osborne’s headline goals on the deficit look charmingly insignificant and astonishingly misguided.
The answer lies in the balance of opinion within the Conservative party, where ‘Europe’ has lost any positive association and where the backbenchers have already shown their willingness to press their views beyond what one might (in other circumstances) be termed politic. For a party that has always valued pragmatism and the preservation of order and rectitude, this is rather surprising. Whose bluff is called and who wins and loses from all of this, it’s too early to say; but it certainly won’t be painless.