The RSA held a very successful fringe meeting at the LibDem conference yesterday evening. Like last year we commissioned a special IPSOS Mori poll to help give the meeting focus (the findings are summarised here in the Times).
The keynote speaker was Vince Cable, LibDem Treasury spokesman and easily the country’s most popular politician. Justifying his plan to close the public spending gap over five years (not the eight argued for by the Government) he directly addressed the view that talk of a fiscal crisis is overblown. The danger of looking weak, he said, was that the credibility of the UK would be undermined, leading to a refusal of foreign investors to finance the debt at affordable interest rates.
I am half convinced by this argument. It is true that the Government needs to be credible when it says it intends to get public finances back onto an even keel. However, the key factor is surely the underlying performance of the economy. In a growing economy, tax receipts go up and benefit costs are stable. If the UK was going in the right direction I’m not sure foreign investors would worry that much about how quickly the spending gap was closed. As Vince himself recognised, the UK’s net national debt is far from the worst among the developed nations.
Two other notable points from Cable’s speech were the accusation that an incoming Conservative Government would raise VAT towards 25% within a few months of taking office, and this wonderfully self deprecating statement. ‘My pamphlet [about spending cuts] contains lots of ideas. Some people won’t agree with them all. In fact I’m not sure I agree with them all’!
The challenge for the LibDems is to get noticed and in this they are having a good few days. The polls tell us that we have a uniquely unpopular Prime Minister and an Opposition which still doesn’t entirely convince. Arguably, Nick Clegg’s success at capturing headlines has been won at the expense of some confusion about the Party’s core. I suspect his Bournemouth speech will be paid more attention than any by a LibDem leader for many years.
( PS Apologies for being so bad at replying to comments on my pages. I really will get round to it this week)