A new dividing line?
One reason Labour lost in the eighties was that the Conservatives won over the aspirational working class and lower middle class. Labour was perceived to be the party only of the poor and the public sector. Today Alistair Darling tried to draw the line in a different place: between the middle class and the rich, hoping the Conservatives will stumble into the trap of being portrayed as only representing the interests of the latter. David Cameron's initial response that cutting the 50p tax rate won’t be a priority for an incoming Conservative Government suggests he will avoid that trap (but look out for a backlash from Tory traditionalists who may want to insist that the Conservatives make this, at least, an aspiration for their first term).
Growth: Short and medium term
The Government’s medium term growth forecast (3.5% from 2011 onwards), for which Labour will not have to answer at the next election, is very optimistic; its 2010 forecast of 1.25% (for which it will) may be more realistic. Alastair Darling will hope he will be able to report next spring the economy is hitting or even exceeding the 2010 target. And if Labour scrapes a victory at the election and then misses the more ambitious target for 2011 it will have until 2014 or 2015 to change the script.
Efficiency savings and cuts
Already the IFS and others are questioning whether the £5 billion in efficiency savings for next year can be achieved without service cuts in areas like health and education. I suspect not. However, Labour won’t necessarily be too worried about this. Even if people are suspicious about Labour on cuts it won’t automatically make them warmer towards the Conservatives.
1991 or 1996?
I wrote a blog a few weeks ago asking whether today feels more like 1991 (before a Government re-election) or 1996 (before an Opposition landslide) . Commenting on the budget a Government insider reminded me of this saying;
'By next year we will be just emerging from recession; roughly the same point in the cycle as 1992. Most people's focus will be on day to day living standards - we need to have a powerful case to make then'
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