Brown's Cronies Still Delusional

A serious Labour politician

The sound of son of a butcher and former schoolteacher Paul "Lord" Myners on the Today programme this morning was all the reminding I needed of how utterly delusional members of the previous government remain, particularly in the area of their economic (mis)management. He seemed to be saying that what the coalition government is doing in announcing what amount to, in reality, pretty modest savings in the short term, designed merely to halt the speed of expansion of the national debt by slowing down government spending rather than slashing it, is putting some kind of Labourist-inspired 'recovery' at risk. I kid you not.

He and his ilk still seem to think that the last months of Brown, where spending was allowed to run out of control not as part of any genuine attempt to kick start the economy through some kind of novel notion (which even Keynes never proposed) that you can spend your way out of recession while servicing gigantic levels of borrowing, but as part of a calculated effort to save nothing more and nothing less than Brown's political career by bribing Labour's heartlands and key marginals, is actually defensible. It's not, epsecially because it worked, predictably, in the North East, North West and, to a slightly lesser degree, Yorkshire, hence there was no Labour wipeout even if it didn't save Brown (nothing could), but it didn't work in the marginals, hence the coalition.

The point is, let us hear no more from the likes of Myners pretending that there was no political calculation involved with the reckless spending levels following the crash, or, indeed, that Labour had nothing to do with causing that crash with its disastrous system of banking regulation or deliberate stoking-up of cheap credit into a gargantuan property bubble. Even without the credit crunch (which did start in America) there would have been a crash in Britain inevitably, and a pretty big one at that.

Additionally, Myners completed his flight from reality by claiming that the latest G20 meeting was pointless and lacked the substance of the London summit in 2009, presumably because Cameron was there making the case for deficit reduction in the UK, rather than arrogantly lecturing the rest of the world about how to manage their own economies. I suppose Myners was so dismissive about the event because there was no really big chunk of money to boast about at the end. I think it was a mere one trillion dollars at the London event wasn't it? Well, of 'promised' money that is, of course, although hardly any of it ever materialised and hardly any of that which did had any effect on the forces of nature driving the economic cycle anyway. But socialists don't understand that, see? Sometimes the right thing to do strategically is nothing. Well, it matters not for the likes of Myners or Brown or, come to think of it, Alistair "Apologise To Me!" Darling any more. All they can do from now on is nothing. That, at least, should mean that they can do no more damage, thank God.

One last thing I thought worth mentioning: at the end of that programme we also had the annoying, schoolboy voice of Nick Robinson putting the sneering BBC spin on the Cameron G20 performance by referring to a picture of him with his head in his hands as the utterly outclassed, out-thought and luckless England team went 4-1 down to the dreaded Germans and musing, rather lamely I thought, as to whether this "new leader on the world stage" (he's not that new) would end up "hapless" and ignored by the others. I wondered to myself at that point, seeing as it was apparently the day to make sweepingly dismissive statements, whether the performance of this England team, rather than somehow reflecting a "hapless" David Cameron, at least in mind of the Robinson talking head, had far more symbolic force as representing the end of the era of expensive under-performers who nevertheless walk away with a fortune despite having been kicked out of the tournament. That's not England, thought I, that's New Labour! Funny how the two eras, the "Golden Generation" and the gilt-edged years of plenty under New Labour, seem to parallel one another. But, of course, the reality check in the Merchant of Venice (Act 2, Scene 7) says it all:
All that glitters is not gold/Often have you heard that told/Many a man has his soul sold...

Less money (unless deserved), more passion (motivation) and more graft (productivity): that's what we need not only from England's footballers, but from the British population generally. Less bling and more sting; more passion - and less fashion. The superficiality of England's performance almost perfectly parallels the intellectual and moral vacuum at the heart of New Labour. Over-rated and all mouth, costing a fortune, but when the going gets tough they crumble and the results become disastrous. In England's case, Germany showed them up for what they really are, in New Labour's, it was the crash. The only difference is, of course, that England were beaten by superior opponents, which is fair enough, but Myners is trying to defend Gordon Brown, the team captain who made all the wrong moves, chose all the wrong tactics and managed to defeat himself, taking the country with him. And that was after the credit crunch began. That was merely his Germany in the economic tournament. The moment Brown was really tested, the whole economic kingdom of debt that he created crumbled, and so did New Labour.

Myners and others who choose their own narrative on this lamentable passage in British history according to their political orientation are naturally welcome to do so. It might even be a coherent, even persuasive, story for the gullible, but it will never make it right.

As for the BBC, well, I assume there will come a time when the Conservative party finally has its bellyful of the licence fee-funded, left wing dominated organisation's constant breaching of its charter and either disinfects it once and for all or breaks it up into little pieces, some commercial (the ones that are already, that is!) and some taxpayer-funded, with no licence fee. Then the left will have to go away and infect some other institution, if there are any remaining in the United Kingdom, which I doubt.

PS: Actually, Myners' performance on this morning's show was all the more bizarre when you consider that speech he made torpedoing current Labour politicians' arguments against Tory plans. As Wiki says of the speech:

On 8 June 2010, Myners made headlines with a speech he made in the Lords. He said, "We clearly need a policy of fiscal caution. It was right to support the economy during the global recession but there now needs to be fiscal adjustment, as evidenced by the last Government in the Fiscal Responsibility Act. There is nothing progressive about a Government who consistently spend more than they can raise in taxation, and certainly nothing progressive that endows generations to come with the liabilities incurred by the current generation."

Well, my feeling is now that he made that speech certainly not for the benefit of the Tories but to influence the Labour leadership race, possibly in favour of Ed Balls. Conclusive proof, if you'll forgive the straw man, that Labour is only talking to itself. Long may that continue.

Let's Talk About Debt

Who would have thought it? After years of denial Brown finally admits, sort of, responsibility for the banking collapse by deregulating them 'in the nineties', thus proving, incidentally, that the Tory banking regulatory checks and balances worked perfectly. If it ain't broke, Brown fixes it. Now Britain's broke.

Speaking of which, I am hoping tonight that Cameron nails Brown on the scale of the debt crisis this country faces and that his policies caused. The fact that the mainstream media can't seem to grasp this, nor most of the bizarre economic 'expert' commentariat of this country (the Anatole Kaletsky-types), should not frighten the Tory leader. He must make it plain to all that we really can't go on like this. Brown can't blame the banks for making him cave in on deregulation 'in the nineties'. And, as Dan Hannan I think said yesterday, if the banks' advice about deregulation was wrong - and Brown shouldn't have listened to it - why did he decide to listen to the same bankers over the public, trillion-pound bailout? Fool me once and all that. Two wrongs don't make a right.

Debt. Cameron's got to talk about it, not just to demolish Brown, but to be straight with the electorate about the scale of the challenge Brown's scorched earth policies have left for a Conservative government to repair and for future generations to pay off. We are, indeed, all in this together. Everyone. So what is there to be done?

Well, the first thing to do is to face up to reality. The other two parties can't do this because they are wedded to a particular ideology of big state interventionism, so the Conservatives, as always, will have to do it on their own - with a little help from the population. The reality is that public spending is bankrupting the country. I'm not saying that Cameron should be specific about where the axe will fall, but fall it must - hard and often. He's got to level with people, but in a positive way: a little pain now; pleasure later. Reform everything, abolish waste, get more bang for your buck and fix the public finances, starting with Labour's nightmarish overspending, currently putting us at a humiliating 20% bankruptcy risk (five times higher than France, Germany or the USA).

Labour's all about pleasure, pleasure, pleasure -now, now, now - until there's simply no money left to pay for it. That's just infantile.

If the infants are returned, therefore, with "economy killer" Brown at the helm, this country will effectively be bankrupt within a few years.

As it is we already face a period of Labournomic, fake growth (where every £1 of expansion in the economy actually costs the taxpayer £2 in 'stimulus' money. Hey, that's just what the figures say.) As it is we already face a period of stagflation. As it is we already face what could be another lost decade, just like the last time Labour was in charge.

Anyway, those are the sorts of things Cameron needs to talk about, along with all the optimistic stuff, obviously. People want an effective leader, not just a charming one.

Brown is neither. Cameron could be both.

Blair Knew

I nearly missed this extraordinary piece buried in the business pages of yesterday's Telegraph by half-decent economics commentator (and there aren't many of those) Edmund Conway. The thrust of the piece, supported by an interesting flashback to the days when Blair was, apparently, Labour's City spokesman, just when the '87 bubble burst, is that a series of FoI requests have revealed that Blair knew about Brown's mega housing bust as early as 2004, possibly before. Said Conway:

So concerned was the PM back in 2004 that the housing market was turning into a bubble that he asked the Treasury for a full briefing note (in fact he was prompted by an FT column by Martin Wolf, warning: “Nobody knows when the bust will come. But come, I believe, it will”.)

Fine, but nothing, as everyone no doubt recalls, happened. Why? I think we can guess. Conway continues:

Now, it probably isn’t a surprise to hear that the Treasury dismissed this view in its document, which PricedOut has attained under a Freedom of Information request. But I was surprised by the length of the document (eight chunky pages) and throughout its length a sheer unwillingness to countenance the possibility that the housing market would crash. It underlines the simple fact that the Treasury under Gordon Brown was blind to the possibility that things could go horribly wrong – even within the confines of Downing Street. It turns out no-one was allowed to challenge the “end to boom and bust” trope – even Tony Blair himself.

Blair's role in this debacle simply demonstrates how weak a prime minister, and person, he actually was. And, of course, it shows how far he would go to keep the title. He knew and yet he did nothing. If he'd had a spine, he would have fired Brown when he had the chance. But he didn't, and should be judged accordingly.

As for Brown. My God! Is it any wonder that I hate him (and I mean hate) and all he stands for? Is it really that surprising that I, and millions of others, believe he is the worst man ever to have held high office in this country? Should it really be that much of a shock that I am 100% sure that if this unelected, incompetent, vainglorious oddball is somehow given a mandate this year, the damage he will do to this country afterwards would make terrible harm he's caused so far look like the good old days?

At least the politics are therefore very straightforward: you vote Labour in your constituency and you will get five more years of the lying economic wrecker. Vote Tory, you don't.

As far as I'm concerned, it's a moral duty to vote Conservative this time around, and all that that implies if you don't. That what's at stake here. The documentary proof in Conway's article provides the proof, as if more were needed.

And now, just for a bit of extra entertainment, and in case you can't be bothered to click through to original article, is that video of Blair in '87. Who'd have thought a wet-behind-the-ears political unknown, who'd never had a proper a job in his life, would one day be prime minister.

Well, so much for David Cameron. But it is interesting to see Blair back then...



...about the same as he looks now, only less suntanned and without the Yank accent.

Byrne Wriggling

Liam Byrne, no stranger to the odd pork pie, told a whole tray-full of them a few minutes ago during his interview on Radio 4. In response to the serious damage caused to Darling's tax-on-jobs NICS policy by 23 business leaders, who between them employ over 500,000 people, and who've come out in favour of the Tory proposal to more or less scrap the plans, Byrne wriggled, exaggerated, diverted and lied like only he can. The ever-changing Labour economic narrative has just morphed again, this time into an even bigger cutting machine.

For instance, while Darling was only a few days ago talking about £12Bn of 'efficiency savings' - of cutting Labour's massive overspending in other words - today Byrne talked about £35Bn in cuts. Where the hell did that come from? I'm sure he has an answer (he always does), but that's a monster leap in the cuts bidding war in just a couple of days, and gives some indication as to how hurt Labour's economic policies have been by the letter (the bigger the lie, the bigger the damage - it's always been proportional with Labour). Anyway, that's the first bit of wild exaggeration.

Then he goes on about the Tories 'magicking' up figures out of thin air (yes, Liam Byrne said that, ho ho). They will need to find an extra £9Bn in cuts, on top of Byrne's new £35Bn mega-number (he was on a roll by now). The reality is, of course, a little more modest. The Tories will need to find £11Bn in savings, of which £4.9Bn will be counted as a loss against the extra NI money that would come from Labour's tax hike and rest pumped back into the services they have ring-fenced. Byrne damned out of his own, lying mouth again, then.

Whatever the rights and wrongs of this Byrne wriggling, what it shows is that the Conservatives have won the argument on cuts; Byrne's wild numbers at least show that the debate is heading in the right direction, that the government must stop overspending so that it can cut the monstrous national debt. The other thing he singularly failed to do was attack the letter from the business leaders itself. Never once did he say that the businessmen were wrong about the tax on jobs, or, directly at least, that the Tory policy was wrong, either. He did make some feeble reference to the last NI rise, hilariously saying that jobs actually rose after it (it was well before Brown's bust, when public sector employment was still ballooning, and paid for by, you guessed it, tax rises lol), but the thrust of his trainwreck argument was that the Tories were right, but they're Tories, so they're still wrong.

Very lame, Liam. Even for you.

Massive win for the Tories.

UK For Sale: Labour's Betrayal of Britain's Industry

This comprehensive, enormous post from excellent libertarian US economist (my favourite kind), J. Ricardo Valenzuala, on the subject of the vulnaribility of vast swathes of UK corporate assets to foreign takeover, is fascinating and an absolute must-read. In my view, however, and partially in contrast to Valenzuala's, the massive shift over the past decade to the foreign control of British manufacturers - large, medium and small - while certainly providing some temporary benefits in terms of stability and new investment (or, in Rover's case, a stay of execution), overall amounts to no more and no less than a deeply damning indictment of Labour's 13 disastrous years in charge of policy for the UK's manufacturing base, humiliation for the nation, and relegation to economic dependency.

The huge decline in UK manufacturing over the past decade or so simply cannot be hidden, no matter how much Labour's many liars and spinners lie and spin. Even before Brown's bust, his useless policies ensured that the manufacturing sector was either actually shrinking, or that corporations became too weak to defend themselves and stay in British hands, Cadbury being the latest case in point.

History shows that when foreign companies feel the pinch, they do not cut at home, and, if they must, then only as a last resort. They begin abroad. That, to them, means us. Remember Tata Steel and Redcar Corus? No one else seems to. The point is that if and when there is another downturn (though there must remain some uncertainty as to whether we're out of this one yet), Britain will be shockingly exposed because it will be the first country in the firing line for investment cuts by foreign companies. For instance, if Kraft begins to feel the pinch at some point in the fiture, it won't be American factories it will be closing first, it will be British ones. Cadbury, a healthy, profitable, productive and well-managed company, is now vulnerable.

For this reason, we simply must follow the examples of Germany, France and Italy and protect what remains of our homegrown, home-owned manufacturing base from easy foreign takeover. This can be achieved through German-style takeover legislation (remember Vodafone and Mannesman? Vodafone won in the end, but not without one hell of a fight with the German government, who secured enormous, locked-in investment commitments as a consequence, something the current British government has never even bothered to do) wherever such a takeover is deemed to be not in the national interest, the latter measure being transformed into a far sterner test of commitment. This country's highly productive manufacturing workforce deserves nothing less.

Sure, there will be extreme cases where loss-makers can be given a second chance with foreign money, but it's a long-term view for the country as a whole that should shape economic policy in this area from now on, not more of Labour's short-termism, which has always been about the cheap politics of making corporate headaches go away in an election year (ala Rover, 2005) that has doomed far more British industry either to ruin or to second class status than it has ever saved in the long term.

What's therefore crystal clear is that such a paradigm shift, from inept political pragmatism, sold to the British electorate under a false banner of 'globalisation', to an aggressive British enterprise culture which actually creates secure British manufacturing jobs, can't happen under Gordon Brown, but might happen under David Cameron. And that's the chance we can't afford not to take.

We have to take a chance on the Tories, because more of the same under Labour means game over for British industry, and that means game over for Britain.

Budget Bluster

What a load of laughable lightweight rhetoric. "I believe that government can make a difference," whimpers Darling. Yes, mate. But not this one. Not your bust government.

The whole tone of the thing makes me think that he's decided to vote Tory himself, actually (on the sly), because then, in his confused mind, at least he could guarantee the "big changes" he thinks we so desperately need - without Gordon there to wreck them, that is. Well, at least that's two things we can agree on then: the need for big changes and the necessity to vote Conservative to get them.

Peter Hoskin was a little less (a very little less) scathing about this pre-budget manure. He also thinks it's a signal that Darling's nicked another Tory policy and is going to cut business tax. I doubt it will be handled competently even if he does, however, given this nightmare government's record when it comes to the private, productive heart of the British economy. What's more, you can guarantee that it will be paid for not with vital cuts in government debt and overspending, but with tax hikes everywhere. Prepare to become a lot poorer after tomorrow, everyone.

Epic, unravelling fail, 24 hours before it's even happened.

New UK Petrol Spike Just Getting Started

If any further evidence of the pain being caused by the inexorable slide in the value of the pound, and the subsequent inflation an import-addicted economy is suffering, were needed, the latest reports about rocketing petrol prices provide it.

The Independent, for instance, tells us that pump prices have risen by well over a fifth in the past 12 months, although it omits to mention that they were pretty stable for most of that period. It's been the last three months or so that have seen the bulk of the spike - so far. And there is far worse to come. If you drew a graph of petrol price rises over the past 12 months, the line would roughly trace a parabola. My own local Texaco has pushed its prices up five times in the last five weeks alone - to an eye-watering 117ppl, and perilously close to the record of 119ppl, which happened when oil prices had ballooned to $147/barrel, just before the crash.

Today, as of 5.38pm GMT, the NIMEX crude oil price stands at around $81 a barrel and falling (itself an inflated price caused by artificially created conditions of scarcity by OPEC output cuts) as bad consumer spending data in the US causes further jitters on their markets. That's a full $66 a barrel less than the previous spike - or 44%. Even taking into account Darling's many tax rises that have since boosted that price (by about 7ppl since 2009), your pound is worth at least 35% less than it was before the crash came. The economic damage this is causing is unknown as yet, but it will be serious. Indeed, the Chancellor's plan to slap another inflation+1p hike on the price in the budget is, quite simply, economically suicidal.

The whole mess smacks of chaos, incompetence and desperation at the heart of a government hell-bent on pursuing a scorched earth economic policy, where they continue to mask the real horror of the current state of the British economy by creating yet more debt in an attempt to delay reality till after the election. But it's a spiral, with increased debt leading to further currency devaluations, followed by higher inflation, higher prices, especially on imports (like oil) - all paid for by us out of salaries that remain stubbornly flat - and then all that's followed by even higher (stealthy) taxes, and the cycle is complete.

I just hope people remember whose ineptitude is responsible for this renewed impoverishment (Brown et al) - and punish them accordingly, ie: severely. Otherwise, as I've said before, what comes next will make March 2010 seem like the good old days. At this rate, for instance, the two-pound litre will be with us just in time for the General Election and whoever wins will send a signal to the markets, who will then determine in which direction prices will move after that. If it's Labour, then the only way is up - for the petrol price, of course, but also for debt, the acceleration of devaluation, inflation, tax and pain.

For Britain, the only way would be down. Down and out.

Recession v2.0

I still don't believe that the 'first' recession has ended yet, however, even if you allow for a brief period of taxpayer stimulated 'growth', the next collapse into contraction is only moments away. But don't take my word for it. That's according to this Guardian report (yes, Guardian report), citing the talisman trader, Jim Rogers' predictions.

Fears of a double-dip recession and a sterling crisis in the run-up to the election were raised last night amid news of collapsing investment in British industry and a warning from one of the world's leading financiers that the pound could plummet within weeks.

The pound fell sharply on the foreign exchange markets after a day of grim economic news which saw an admission from RBS that it had missed government targets for business lending, a downgrading of the UK growth prospects by the European commission and a warning from the CBI that consumer spending was likely to remain weak ahead of polling day.

Sterling, already down by a cent against the dollar following the release of official figures showing capital expenditure plunging by almost a quarter between late 2008 and late 2009, saw its losses doubled after Jim Rogers, the former business partner of speculator George Soros, said sterling was a potential "basket case".

The rest of the article hardly makes for happier reading, either, at least if you're a Brownite, I suppose. If you're a realist, (like Rogers - and lots of other people), then you'll know that after Brown bet the Bank of England on spending his way to the winning of, finally, a mandate to ruin govern Britain, there is now nowhere else to go for him, his party and for the entire country but down the debt plughole. Labourists, of course, will be reading the article too, and may be (maybe already have been) convinced that from here on in, with Labour somehow narrowing the gap in a few polls (though they'd be very foolish to trust them), things can only get worse.

More reason to believe Guido's mysterious BBC source, then, who said that the election will be called this weekend.

Bring it on (finally).

Darling Puts The Boot In

This pretty strange report in tomorrow's Telegraph, about an interview with Alistair Darling in which he claims that "Brown unleashed the forces of hell" on him for predicting the recession, suggests that at the very least, as Iain Dale says, he's just signed his own "political death warrant".

In an frank interview, the Chancellor said that people working for Mr Brown tried to damage him because he told the truth about the economy.

His remarks follow reports in a new book by Andrew Rawnsley that Mr Brown’s aides tried to undermine Mr Darling after the Chancellor forecast the worse economic downturn for 60 years.

In a Sky News interview, Mr Darling confirmed that No 10 worked against him. Mr Darling made his 60-year prediction in an interview in Scotland in the summer of 2008. Afterwards, No 10 aides briefed journalists that he had harmed the economy and should be sacked.

“Nobody likes the sort of briefing that goes on,” Mr Darling said, “the forces of hell were unleashed”.

It might sound like Darling is getting his own back for Brown's desperate disloyalty when the bust came, which he knew was all his fault and not Darling's, but I'm not so sure. If past experience is anything to go on, Darling, if challenged, will simply issue another humiliating "clarification" tomorrow and say that Brown has his "full support" and always has, clearly total rubbish though that now certainly is. But there was more in the report about Brown's henchmen, one of whom is still in business, bankrolling the Labour Party with the membership funds of the union he's been given to play with (Charlie Whelan):

Asked if he believed Mr McBride and Mr Whelan had briefed against him, Mr Darling said: “Of course you have people saying things.”

In a reference to Mr McBride’s resignation last year, the Chancellor added: “My best answer for them was: I’m still here and at least one of them is not.”

During the summer of 2009, Mr Brown planned to remove Mr Darling from the Treasury and replace him with Ed Balls, a long-standing ally.

The plan to oust the Chancellor brought a new confrontation between the two men.

But, as I said, I think Iain Dale is right, this could well be a step out of line too far given the current coverage Brown is (quite deservedly) receiving, clarifications or no clarifications. However, for the time being, I suspect it will be business as usual in the bunker, at least superficially, mainly because Darling, for all his genuine niceness, is as much of a politically self-interested jellyfish as any other Labour MP or minister.

But, in putting the boot in to Brown, Darling was not trying to perform some sort of a public service (perish the thought!). He was indulging a minor act of political revenge that merely provides us with further proof of the factionalism and mutual loathing that's always existed at the rotten heart of this Labour government, but especially so under the utterly disloyal political thug that is Gordon Brown. Darling offers conclusive proof - as if we needed it - of two things. One, that the facade of government unity under Brown, peddled by the likes of the slimeball Mandelson (et al), for reasons of personal aggrandisement and vanity, has always been just that, a complete myth. Brown's government is one of the most factional and dysfunctional of all time. Second, that working under Brown is hell.

Given that the future of the country is (or "was" - it might well be too late) at stake, this calamitous state of affairs at the top of the government is a lot more serious than a mere case of bullying. This is a major case of a man promoted way beyond his abilities (Brown or Darling - you pick). What's crystal clear is that when Brown is finally ousted, the kind of revelations that come out about his behaviour while in politics, let alone while in charge, will ensure that his historical reputation will lie in total ruins. Couldn't happen to nicer man.

No wonder he's so desperate to cling on - preferably, no doubt, without the inconvenience of the democratic process.

Tory Lead Ticks Up As History Repeats Itself (Again)

After a day which saw the worst government borrowing on record for the month of January, causing severe pressure on sterling and the markets, and bank lending to businesses and prospective housebuyers to tank once more, at least there was some good news today, from a Conservative perspective and, therefore, by implication (as far as I'm concerned) a national perspective. Reliable new pollsters, Angus Reid (courtesy of PoliticalBetting) place the Tories a full 14 points ahead of Crash Gordon's Labourists.

However, not everything looks rosy for David Cameron. Jeff Randall, nobody's fool when it comes to the not-so subtle relationship between business confidence and political leadership, has written a powerful comment piece for tomorrow's DT, ahead of his Sky interview with the future Prime Minister next Monday, which suggests that Cameron could well be facing some awkward, but nonetheless timely and utterly vital, questions about how he plans to rescue Britain from Brown's debt disaster. It's well worth the read. For instance:

History has much to teach us in today’s financial crisis, not least that we have been here before in one form or another. The economy is in a mess, government spending is out of control, and our currency is being devalued. Desperate ministers, fearing disaster at the polls, seek to denigrate opponents by labelling them “toffs”.

Put another way: “Our finances have been brought into grave disorder. No British Government in peace time has ever had the power or spent the money in the vast extent and reckless manner of our current rulers... no community living in a world of competing nations can possibly afford such frantic extravagances... the evils which we suffer today are the inevitable progeny of that wanton way of living.”

This analysis, crisp and incontrovertible, could have been penned last week by David Cameron to sum up Gordon Brown’s shambles. It comes, however, not from the current Tory leader but Winston Churchill in the Conservative Party’s manifesto for the general election of 1951. Much has changed since then, yet the immediate political challenge facing Mr Cameron is not dissimilar to the task Churchill confronted 59 years ago.

There's much more to the article, however, good though this part was (and quite surprising the first time you read it, too). Randall ends it with a virtual crib sheet of substantive policy questions that he'll put to Cameron on TV next Monday. Cameron must not fluff his lines. He must not obfuscate or indulge in the tired, divisive political rhetoric that characterises 13 years of this dishonest and finally disastrous Labour government. He must answer honestly, clearly and with passion. He must punch the weight of his party, which has won the argument on the economy and must now win a strong mandate to put right Labour's many crimes. And do you know what? I believe he will.

But if he does need to call on the wisdom of an historical figure to bolster his political resolve and help him to steel himself for the massive challenges, that we all face, ahead, he could do far worse than to invoke the memory of Churchill (or, for that matter, another post-war Conservative PM who saved us from the grievous distress caused by a previous Labour government, and to whom Randall also refers in his excellent piece).

Make Labour History

Tony, whose Cogito Dexter blog won my sincere admiration many months ago, has asked us all to join him in his campaign to Make Labour History.

He has my full support to that end. If you really do want to secure a prosperous, free, pluralist and debt-free future for your children, in the finest traditions of our great country, Tony should also be able to count on yours.

I promise that I will do as much as I can to bring about that desirable, and, for everyone in Britain, and for the nation itself, that desperately vital outcome in this Year of Change, 2010.

Bottom line: if you want to save yourselves, your economy and your nation from total socialist destruction, then Vote Conservative - and make Labour history. After thirteen years of hurt, it's very much more than Labour deserves, and it's what we and our country so desperately need.

(Tony: sterling work, compadre. Outstanding.)

Understatement of the Year (So Far)

Nick "I know which side my bread is buttered" Robinson, BBC-Labour's tame political pundit, after the start of the UK's so-called economic recovery (0.1% to be adjusted is not exactly Darling's "trampoline" recovery now is it, especially after squillions in printed inflation-fuel has been chucked at it?), has just concluded on his hyper-moderated blog:

...some voters may note that we are still not securely out of the longest and deepest recession since the war and may conclude that the current custodians of the economy can no longer be trusted to finish the job.

You think?

The fact that Brown and his cohort of economic nincompoops and ne're-do-wells, whose now-legendary incompetence is only just about trumped by their compulsive mendacity, have managed to bankrupt the country in search of some sort of theoretical, artificially stimulated recovery that, as these figures show with devastating clarity, has utterly failed to materialise will not have gone unnoticed by the general public.

So, toenails, my old china, for "may conclude," read "decided a long time ago," and for "the current custodians of the economy," read "the Brownite, Labourist liars and wreckers," and for "can no longer be trusted to finish the job," read "are going to be lucky to get away with not being hanged en masse from the nearest tree, never mind an election defeat, for the cataclysmic economic harm they've managed to do to Britain, not to mention the desperate harm they've managed to do throughout British society, during their overlong period in office."

This is no time for understatement, you see!

But it is time for a Tory government. And if you read between Robinson's BBC-approved lines, even he knows that most sane people have known that for quite some time.

UK Debt Downgrade "80% Certain"

Tomorrow's DT will make further horrible reading for Brown and Darling (I dearly hope). According to one of their economics journos, Ed Conway, the head of one of Britain's leading fund managers, Neil Woodford, Darling's and Brown's inability to face up to the unsustainable scale of their spending and consequently gigantic debt levels - at least in peacetime - is now virtually certain to lead to a credit rating downgrade and, far worse, a subsequent debt spiral. Woodford is quoted as saying:

I would argue that there is a high probability... a decent chance that we will be downgraded, and it is a near certainty if we do not, in the wake of the next election, properly deal with the deficit. There are some major challenges here. If we do not take the medicine, there will inevitably be a downgrade. If we do, we have a chance of escaping a downgrade.

After the PIMCO shock, where their experts determined that there was an 80% probability of a downgrade from AAA and acted accordingly by dumping UK gilts, it seems this gathering economic storm is going to make the current arctic weather and subsequent national chaos look like a soft, Barbados beach on a warm day.

And the only party with a plan for getting us out of it with a coherent fiscal policy, designed to allow monetary policy to remain loose by avoiding the downgrade and subsequent, devastating interest rate rises and inflation, thus enabling a strengthening in any recovery, is the Conservative party. Philip Hammond proved that yesterday.

No wonder the Tories want an election right away. They're not bluffing - it's vital that we have a change of government because it really is the 11th hour for Britain's finances and economy.

Action must be taken - now!

By the way, well done Gordon. Well done Darling. Britain really is nearly bankrupt, thanks to you. Marvellous.

Brown's Gilt Trip

Mark Bathgate warns that Brown faces a major headache next month. The cost of Britain's debt is creeping up, especially after PIMCO decided to dump UK gilts, making it more and more expensive to fund, as Bathgate calls it neatly, Brown's "fiscal debauchery". As Bathgate says:

With inflation continuing to "surprise" on the upside, how long can the Bank of England keep justifying printing money? Now we learn that the Bank of England had printed £193.5 billion to finance government spending by the end of last week. So we are only four weeks to the next MPC meeting – but there is only £6.5 billion of new money left for them to pump out before they hit their £200 billion limit. Then we enter the scary territory I outlined in an earlier post. And Brown is still left needing around £15 billion of Gilt sales a month to finance his fiscal debauchery.

The Gilt market was fine while Brown's appointee's to the MPC were willing to keep the printing presses rolling to the tune of £1 billion a day through the summer. But...as inflation has started to rise quickly, the pace of money-printing and Gilt purchases has had to slow.

This has become a race for Brown, between the general election and a visit from the IMF. How long can he keep hosing borrowed money away, with no cogent plan to bring spending under control, or, in fact, no apparent acceptance even of the need to do so? The truth is, he can't face up to reality, but reality is about to bite. However, his head is currently buried deep in the snow. In what appears to be yet another classic Brownian displacement activity, he's taken personal control of the nation's dwindling grit supplies. Well, Gordon, this country and your diabolical premiership are on life support. And it's about to be switched off.

Seems to me this is an argument for a March election, but I reckon Brown is running another kind of race in his fevered imagination. He thinks that if he hangs on long enough, then the recovery will have begun and he will be able to take credit for it.
It won't matter to him that we were first in and last out (by a mile).

What he doesn't seem to realise is that the rest of the world, especially the parts having to fund his economic lunacy and political dishonesty, couldn't care two hoots about his political destiny, or the financial stability of Britain, for that matter. Why should they? But they could well be about to pull the plug, and yet the Bank of England has no choice. With inflation rising, adding to the strain on an economy mired in debt and still, officially, in recession, it will not, as Mark Bathgate suggests, be willing to go beyond the £200Bn funny money level. Next month will therefore be crunch time for Brown. He's gambling with the British economy and people's livelihoods just to save his own political skin.

But even if he thinks he's got away with it, with the start of a limited recovery (after the longest, deepest recession in the world, remember), he will not be forgiven for his behaviour and for the disastrous state he has left Britain in. That's the misjudgment he, and many of his jellyfish Labourist co-conspirators, have consistently failed to comprehend.

Give us the election so that we can explain it to them.

Meanwhile, as Bathgate says:

The market has already started to push up the cost of borrowing for the UK. It's risen by 0.6 percent over recent weeks. Despite having official rates over half a percent lower, UK borrowing costs are now 0.7 percent higher than those of Germany. I suspect the Gilt market will be very vulnerable in coming weeks.

Hang on to your hats, folks, we're all on Brown's gilt trip and it's gonna be one hell of a bumpy ride.

E. Balls, A. Balls, PIMCO and Gilts

I was just skimming through the comments beneath Jeff Randall's latest all-out assault on Labour's epic economic incompetence when I stumbled upon something rather interesting of which, in my ignorance, I knew not (thanks to the poster "BD MATHERS," I do now). The European portfolio manager (chief buyer) of the biggest bonds and gilts dealer in the world, PIMCO, is none other than one Andrew Balls, Ed Ball's much smarter little brother.

"So what?" you may well ask. Well, for one thing, PIMCO holds $183Bn of assets and, as such, is the biggest company of its kind in the world. What is more, it's playing a vital role in keeping the British economy's head just about above water, for now - (or, at least, keeping the Labour shipwreck afloat). However, PIMCO announced yesterday that it will be withdrawing from both the US and the UK markets. The US will just about be able to cope with this since it has many other options open to it. Not so the UK, a far smaller economy where debt dependency means we are orders of magnitude more leveraged than the States. As the "economic voice" blog says:

In what amounts to a massive vote of no confidence PIMCO has announced that it will cut back on its UK and US government debt holdings. They see government borrowing rising and the central banks no longer buying through quantitative easing, which will push the supply / demand balance into negative territory for them. They are expected to move into European government bonds as these have not had the same level of government support. If a flood of UK Gilts are dumped on the market we could see yields rise (prices drop) more than anticipated.

This leaves the questions of where will the government raise the circa £180 billion it needs for the next year? And how much more of a premium in the form of increased bond coupons (interest) are we going to have to offer before investors are happy to take the risk of buying new Gilts? Also, when will the Bank of England be able to sell its accumulation of Gilts back into the markets without suffering a massive loss?

Next stop the IMF?

Indeed. This is a very, very serious development which has all-but been drowned out by all the noise coming from Brown's latest pathetic leadership crisis over the last 24 hours or so, although some bloggers, most economists and some broadcasters did pick it up. It is a stark truth, but Jeff Randall is absolutely right: Britain is broke; the coffers are [worse than] empty. He was wrong, however, in his assessment that both main parties are too scared to talk about managing this calamity. As I said earlier, Philip Hammond was refreshingly candid, forensic and solid in appraisal of the Labour-led crisis in the PBR debate today. It's only Labour that's delusional about the scale of the problem, in particular the Prime Mentalist himself - oh, and one Edward Balls.

Which brings me back to the theme of this post: the embarrassment the Balls brothers connection might (should) cause the government. Why? Guess who will be steering through PIMCO's dumping of UK gilts. One Andrew Balls, European portfolio manager. The "economic voice" again:

Apart from the economic repercussions for Britain, it also embarrassingly appears that Andrew Balls (younger brother of Ed Balls, Secretary of State for Children, Schools and Families) will be overseeing this withdrawal as head of PIMCO’s European investment team.

But in a huge, gobbledigook in-house interview posted after Christmas on the PIMCO Europe website, Balls Minor puts a bit of English on what the company calls its "European Cyclical Outlook and Strategy" (aka, its "Get the hell out of the UK as fast as possible" plan).

...there is more uncertainty around the forecasts than usual, and it is even more difficult to identify the turning point in the economic cycle because larger, secular changes are also underway. Over the long term, we expect to see a major shift to lower growth in the developed economies, higher growth in the emerging economies and greater government intervention and regulation overall. PIMCO calls this new economic reality the New Normal.

Compared with the core eurozone countries Germany and France, we see the UK as having a more difficult adjustment to make to the New Normal due to weaker initial conditions, greater ongoing need for deleveraging and, in the household sector, the need to rebuild savings, which are low compared with the savings rates you see in Germany or France.

However, the UK has benefited from more aggressive policy interventions and related to this, the depreciation of the British pound versus the euro and the dollar. We also consider the UK a more flexible economy than Germany or France. That is a benefit for the UK in terms of handling the big shocks we have seen hit these economies.

Taking all these factors into account, the growth forecast ranges are similar for the UK and the eurozone as a whole, and their outlooks are broadly similar, but the midpoint for the UK is a little bit higher than that for the eurozone.

Another important point is that while we see unexciting growth at the eurozone aggregate level, we expect to see considerable differentiation across member countries because of weaker initial conditions and greater deleveraging requirements in some countries.

Get that last bit? "Weaker initial conditions and greater deleveraging requirements in some countries [in Europe]." For 'some countries,' read the UK. For 'weaker initial conditions,' read Gordon Brown's total cluelessness in his decade of lunatic spending into a massive property bubble that he helped to create and fuel. Seems spinning the facts could therefore be in the Balls family genes. To be fair to A. Balls, though, he is stuck between a very thick rock (filial loyalty to an older brother - and sister-in-law - who helped cause the UK's current economic chaos) and a very hard place (doing his job). It seems he plumps for the latter in the end, though, in his assessment, stating (in econo-nerd speak, naturally) that:

In the UK there is also uncertainty over what the Bank of England (BoE) will choose to do with the stock of gilts it has bought during 2010. The BoE has bought gilts across the curve, whereas the Federal Reserve’s quantitative easing purchases have largely been focused on mortgage-backed securities. So there is a bigger question mark over the exit strategy here for the BoE, whether it will continue to hold these bonds or whether it will at some point try to reduce those holdings.

Because the eurozone does not have large-scale quantitative easing programmes to unwind, we remain moderately bullish on eurozone duration. We also remain positive on covered bonds in the eurozone. The impact of ECB purchases of covered bonds is very minor compared with the quantitative easing programmes in the UK and the US...

This is why his bosses have told him to dump the UK (and US) and buy European debt instead. He goes on (boy, he goes on!)...

On the UK side, in addition to the risk associated with the end of quantitative easing, there is also political uncertainty surrounding the elections, most likely happening in May, and the implications there for fiscal retrenchment and for fixed income markets. The chance of renewed pressure on the British pound remains a source of tail risk, a risk that poses a market crisis or systemic event that can severely hurt portfolio returns, in the UK.

In other words, the UK is the most likely candidate for basket case status in the entire continent of Europe. I wonder if Ed knows what his brother's been up to? Andy knows what Ed's been up to, that's for certain. You know what, I think Britain ended up with the wrong Balls in the government.

Anyway, that's enough of that. It's all just too unspeakably depressing for words. My God this country has been fubar-ed by Labour. Again.

Hammond Trumps Byrne

Just been watching BBC Parliament (now there's a displacement activity if ever you've heard one).

The debate on the PBR has been no contest, with Philip Hammond, Shadow Chief Secretary to the Treasury, delivering a devastating lesson in economics to the entire house, not just the idiots in government who, for instance, don't seem to be able to comprehend the difference between monetary and fiscal policy, (a pretty fundamental problem if you're trying to prove to unconvinced bond markets that you're in control of things).

He's damn good. His forensic unpicking of the Brownite, delusional, dangerous PBR is highly damaging to the last traces of Labour's credibility - or would be if anyone was watching it, of course. Even the usually thuggish Liam Byrne looked quietly impressed.

I hope Hammond is given the praise he deserves for this superb parliamentary performance.

I'll put up a link to it later, if I can find one.

==Update==
Well, perhaps predictably, you can watch the PBR debate on iplayer, but only as far as the end of Byrne's woeful and woefully partisan speech. The BBC clearly didn't feel that Hammond's excellent response, during which he not only provided a forensic demolition of Labour's fantasy economics, but also clearly set out some of a future Conservative government's plans for bringing Britain back from the brink of a credit downgrade (and why that is so desperately important), merited the little bit of extra space on their ample servers (that we own).

Bias at the BBC? Never!

==Update 2==
Jonn Ward has kindly provided a link to the transcript of Philip Hammond's PBR speech. You can find it on parliament's website, here.

Not As Bad As We Expected: Far, Far Worse

Darling's Pre-budget nonsense represents the most appalling assault on the middle classes yet, who, as usual, are going to be squeezed dry to pay for useless Labour's economic bust. It also means that Brown Labour has now dropped any pretence that it cares about anything else other than its short term goal of somehow getting itself re-elected. In fact, though, it could be said that this dodgy dossier of Tory-bashing tribalism is so utterly awful that it amounts to a capitulation - at least by the feeble realist arm of Labour, possibly located at the Treasury. They can't win the next election based on an economic record as catastrophically terrible as Brown's, so the story goes, so why not use the remaining months of power to shore up the core vote and the heartlands? Limit the damage and bugger the country.

Benedict Brogan seems to think this - and more. The budget wasn't as bad as we expected, it was far, far worse.

Even before we’ve trawled through the small print on pensions and tax changes, the pre-Budget report has lived up to the billing. Scorched earth, poison pill, you can choose your metaphor but the key point is that this was a political statement designed to protect Labour’s sectional interests, boost its core vote and stuff the Tories at every turn. George Osborne will probably get the prize for offering the pithiest summary in his reply to Alistair Darling: the greatest golden rule of all is that you can’t trust a Labour government with your money.

Every other line in the Chancellor’s statement was shaped to make a political point: ‘unemployment is never a price worth paying’, ‘government action has made a real difference’, ‘those who doubt the effectiveness of tax credits’, ‘when we could have chosen to do nothing’, all direct digs at the Tories. The ship is sinking under him but the captain blames the passengers.

The measures likewise: for example, a whacking great increase in the value of the state pension (2.5pc when inflation is negative?!), ditto other benefits, represents a gratuitous increase in the cost of entitlements, in the knowledge that the Conservatives need to review them downwards. Reckless, unaffordable, yet how can the Tories reasonably be expected to reverse that one? Such is the political craftiness of Gordon Brown. Or take the freezing of the threshold on the 40p rate: all attention is on bankers, but this is where senior nurses, policemen, middle managers will suddenly find themslelves dragged into the higher rate. Then there’s the 0.5pc increase in NICs, and the pension cap on public sector workers. Ditto the tax on bonuses: a paltry £500m in, but how many billions out as confidence ebbs away from the City. And there’s the business about taxing employer pension contributions: it hits those on above £130,000 – wealth creators they may be but how much sympathy will there be for them? Again, crafty.

“We take these decisions from a position of strength,” Mr Darling said, to howls of derision from the Tory side. The economy is crocked, the markets are pulling the plug on UK plc (bookies have just cut the odds on us losing that AAA rating), and those whose efforts are needed to get growth going again are going to have to pay a lot more, so what is he talking about? The strength that comes from being the party in power, free to use the forces of Government to its advantage. It is in office, so it is still strong. It can be outrageous, it can trash the place, it can do what it damn well pleases because it knows that the mess will be for the Tories to clean up. Labour is already waiting to be in Opposition, shrieking at any attempt to undo any of this. The civil service has been muscled aside, its warnings ignored, Labour now at the controls shouting ‘Gordon is great’ as it pushes the throttle down towards the mountain ahead.

Excellent comment and that "you can't trust a Labour government with your money" is not just pithy from Osborne, but oh-so true, too. How much more evidence do people really need that this trainwreck regime is willing to take the entire country over the pricipice (which is what I assume Brogan means by his mountain metaphor) with it? As a reader of this blog said yesterday, this is not just as bad as 1979, it's much worse. At least Callaghan was a decent human being who understood, above and beyond the pettiness of tribal politics, that he and his government (especially Chancellor Denis Healey, but even he eventually put country before party and made, as David Hughes says, the "tough choices") had failed Britain.

Brown actually does know that they have failed Britain too. The difference is, in his arrogant dishonesty and visceral, irrational hatred of the party opposite, he simply doesn't care.

So if you are one of those who think Labour gives two hoots about your country, think again. The only thing that that corrupt, corrupting and bankrupt party cares about is itself, and this is embodied in the blind ambition of Brown, himself the worst Prime Minister this country has ever had inflicted upon it. But he and his party will cripple Britain for a generation before they give up power. It really is finally time for people to wake up to this reality and act accordingly.

Whether you happen to like it or not, the fact remains that the only way to get Brown-Labour out is to vote the Conservatives in. After this latest episode of scorched earth, recession-prolonging, gaga economics from Labour, there is surely now reason enough, if you are otherwise a Tory detractor (unlike me) to hold your nose, bite the bullet and take the plunge.

Never has this country more desperately needed to oust an irrational, wounded and dangerous government and a tainted, failed - and equally dangerous - Prime Minister. So that's the first thing that simply must happen and that means supporting the Tories. All else follows.

King Backs Osborne

This is the implication of Mervyn King's long-overdue criticism of Crash Gordon's mishandling of the economy and creation of the largest peacetime deficit in British history, ostensibly somehow to buy his way out of recession, but in reality to try to generate some sort of fake recovery in the run-up to the general election, thereby, somehow, securing a victory. God help us all if that works.

Well, that's precisely the point, isn't it? Whatever the motive for Brown's profligacy, it's becoming abundantly clear that it won't work. Britain is not recovering, in spite of the gazillions of pounds, much of it printed, being poured down the drain to make up for Brown's truly horrific, banana republic-style borrowing and spending splurge. King, it seems, has finally come clean on the scale of the government-led secret, further bailout of those two giant Scottish banks, RBS and HBOS, (£61Bn) whose chiefs were so very close to Brown and other Scottish Labourists, and who brought such pain to the people of Britain as a whole with their casino business practices and high risk, rank profiteering. He seems to have had enough of carrying the can for all Brown's gargantuan errors of judgment, both as Chancellor and as unelected Prime Minister.

Today's Telegraph report therefore makes refreshing reading, at least for me, loathe Brown and support the Tory plan for saving the British economy as I do.

In comments which are likely to infuriate Mr Brown, Mervyn King said that the next Government would need to “eliminate a large part of the structural deficit” over one parliamentary term alone. This proposal goes significantly further than anything penned in by the Government in the Budget, or what is demanded by the Fiscal Responsibility Bill unveiled last week in the Queen’s Speech.

In a hearing of the Treasury Select Committee, Mr King said repeatedly that the Government’s plan needed to be “credible” and detailed, or it would lose the confidence of the international investors who buy British debt. He said: “I think [the plan] has to be something where a really significant reduction in the deficit, the elimination of a large part of the structural deficit, takes place over the lifetime of a parliament, which is the period for which a government is elected. Beyond that is a statement of intent and hope rather than a plan for which someone can be held accountable.”

This, to me, represents not only a "rebuke" of Brown for his incompetence and subsequent complacency about the state of the national finances, but also a clear message of support for George Osborne. And it goes further, according to the report.

In comments which will further rattle markets, Mr King said that the top-tier rating on Britain’s debt could be at risk if the Government does not go ahead with significant cuts.

He said: “I don’t think there’s any immediate risk [of a downgrade] but of course the longer there isn’t a credible plan that sets out what actions will be taken, the more that is a risk. I myself don’t think that there is any impediment to the UK putting in place a credible plan that will convince financial markets.”

This is arguably the sternest of the numerous warnings the Bank’s Governor has issued to Mr Brown over the size of the deficit. It is the first since Mr Brown announced last week that the Government would draw up legislation forcing it to cut the deficit each year for the next decade and insisting that it halves the budget deficit within four years. Since then, however, official statistics have shown that the Government is still borrowing cash at the rate of almost £3 billion a week.

I wonder how Brown will get his revenge. Remember, you see, for 'moral compass' man, it's all about politics and always has been. He will burn anyone down who shows dissent and over whom he exercises some form of control. That's Brown's way, the way of the bully, the coward and the demagogue.

It's also the Labour way. An expert has just spoken out of turn, in this case Mervyn King. We know how Labour deals with people like that, don't we Professor Nutt?

But hey, things can only get better. We can vote the bastards out in 2010. As one poll shows, published at the same time as that Guardian Ipsos-Mori rogue, (another puts Labour back down on 22%, on point ahead of the Liberals), it's looking increasingly like that's precisely what we will do. And there's nothing Brown, Mandelson or the rest of that shower of lying, ruinous losers can do about it.

Brown Reduces The Deficit

No, not with the ridiculous panic measure that is the £16Bn (plus or minus £13Bn) fire sale of a few assets, but by being forced to pay back 13 large of taxpayer readies that he, the Prime Minister no less, has troughed.

Meanwhile, as the pound begins to plummet, the penny begins to drop.

A Big Day after all, then!

PS: I have one response to Brown's expenses misfortune as the police move in on his fellow Labourist fraudsters, currently whining away and trying to wriggle out of repaying their ill-gotten gains. It goes like this...



*sides splitting* Oh dear, Brown. Do stop. By resigning.

We're all laughing policemen now. One more time!

Asset Stripping

Cred: Gigits

So Brown has announced a £16Bn fire sale of a few assets because, as he so very convincingly put it, "we need a deficit reduction plan that supports growth and jobs not one that snuffs out recovery before it has started."

It's quite difficult to get one's head around the bare-faced gall of this man. It was only a few weeks ago that he was claiming that the gargantuan public debt he's stoked up, spiralling out of control, was not a problem ("best placed to weather the storm" - remember that?). Mind you, it was only a few years ago that this idiot was still boasting that he'd abolished boom and bust (see video). Whatever the dishonesty - or lunacy - of his economic narrative (I think everyone now knows who really caused this crisis by wrecking banking regulation, deficit spending in a boom-bubble, 60%+ public sector debt and soaring, and racking up what will soon be a 12.5%+ structural deficit - which has nothing to do with the recession), this is particularly desperate stuff even for him.

As Iain Dale points out, the fire sale just about covers August (borrowing: a staggering £16.1Bn), but what about September? It's hardly going to be any better and there is precious little left to sell. What is more, and why this is so desperate, is that these sales for that very reason are going to be a disaster. The market will know the kind of pressure the Treasury is under to raise capital and so potential buyers will beat down the values massively. The idea that these assets (the Dartford tunnel, for Pete's sake) will raise anything like £16Bn is highly debatable.

Whatever the ins and outs of the economic technicalities of this new policy-on-the-hoof, there are a few other points to make. One is that we all know why Brown is really doing this, it's so he and his perennial henchmen Balls and Byrne can somehow outmaneuvre the hated Tories. This isn't about managing the deficit - the only way to do that is to slash public spending (CUTS, Gordon!) - it's about looking tough and giving the impression that this government - but Brown in particular - have actually got a clue and a grip. That's why I think it's significant that Brown made these announcements and not Darling. I very much doubt that Darling had much to do with them: there's little evidence as yet that he did. I wonder how he feels about that...

The second point to make is that, of course, this won't work. When the next round of government bond sales are due and yet another dollop of BofE printed money is required, the pound is going to go into freefall (again). We could be in for a credit downgrade, too (which means higher interest rates for everyone). Then the real pain begins as prices rise and the standard of living falls for everyone. Inflation is inevitable at this point and with manufacturing output collapsing again by a further 2.5% last quarter, there is little sign that any recovery is likely any time soon, no matter how much more "stimulus" is injected into the system and whatever the "rebound" idiots in this government would have us believe. Inflation makes this kind of activity pointless anyway because all you do is crush any potential growth under the dead weight of a devalued currency. At some point the balance tips and pump priming becomes ineffective. That time is now.

But that's basically Brown's narrative - all the way up to the election. He couldn't care less. He's trying to buy the popular vote - and he'll borrow anything, say anything and sell anything to that end. Simply, the man is mad and all those journalist-cum-economists with (some version of) Keynes on their brains do this country a terrible disservice by continuing to support him just because they don't much like the Tories. But they should know by now (well, everyone of them apart from Will Hutton who is as hatstand as Brown himself) that this is nothing to do with economics any more. This is all about Labour; this is all about Brown.

Brown will still lose the election. But so what? The damage will have been done. Not only will this generation be left with the smouldering ruins of an economy once again destroyed by an arrogant, incompetent and basically wicked Labour government, future generations will be too.

Brown's legacy indeed.