Alistair Darling’s make-believe Budget

The only resemblance that yesterday’s annual UK Budget had to previous Budgets was the tattered red briefcase that Chancellor Alistair Darling held up for his photo-shoot.

Since the first red case was made for Gladstone in the 1860s, Budget Day has been an important fixture in the British political calendar. Yes, it always had something of a ritualistic quality about it, but in most cases it was a ritual that really mattered. That was then.

With one fell swoop, Darling has succeeded in turning this annual ritual inside out. He denuded Budget Day of any meaning as he went through the motions of make-believe Budget-making. Some commentators have described it as a ‘fantasy Budget’. In the sense that fantasy involves a flight of fancy unrestrained by reality, they are right. But in the sense of fantasy involving some imaginative thinking, describing Darling’s Budget in this way gives the term fantasy a bad name.

Even by the low standards of contemporary public life, the Budget was an unusually disturbing example of responsibility evasion. It is based on calculations and projections that were cobbled together to avoid facing reality. Darling’s prediction of a recovery in economic growth of 1.25 per cent next year, along with his assessment of the scale of Britain’s economic decline, lacked plausibility.

He wasn’t so much making predictions as making a plea – a plea to avoid having to face up to the difficult challenges that lie ahead. Like the flustered child caught red-handed, Darling’s message to the public is: ‘It wasn’t me!’

Up to a point, Darling has successfully got sections of the political class and the media to buy into his fantasy document. For example, many have interpreted the new 50 per cent upper tax rate – for those who earn over £150,000 – as a significant political development. According to the Guardian, it represents a ‘return to class politics’. The Daily Telegraph described it as ‘class war’.

In truth, this populist gesture of ‘taxing the rich’ is simply a feeble attempt to hold on to Labour’s disintegrating core vote. As everyone knows, or at least should know, the 50 per cent upper tax rate has only a symbolic significance. It will make little difference to the public purse. Nor will it have a significant material impact on the wealthy, who already are quite formidably skilled in the art of tax avoidance. All that this new tax shows is that, in Darling’s Budget, the desire to score a good Public Relations hit overrides any commitment to sound economic thinking.

The debate around the Budget indicates that Britain is not yet in a position to have a serious discussion about the current economic crisis. Why don’t we admit that there will be no real recovery next year, or that unemployment might rise higher than three million? The Budget discussion also shows that the current generation of political leaders have little experience of policymaking during times of economic crisis. Sadly, far too much of the discussion has been focused on the question of when the economy is likely to recover and by how much. It’s difficult to avoid the conclusion that many policymakers are fatalistically searching for those elusive green shoots and waiting for the recovery to put everything right.

This sentiment is based on the hope that economic recovery will spare the government from having to make some very difficult and potentially unpopular decisions in the here and now. It is this sentiment – this policy-lite, responsibility-evading desire to put off the serious discussion and the serious decision-making – that encouraged Darling to come up with a Budget-in-waiting rather than the real thing.

Frank Furedi’s most recent book Invitation To Terror: The Expanding Empire of The Unknown is published by Continuum Press. (Buy this book from Amazon(UK).) Visit Furedi’s website here.