A brief note to George Osborne

Hi, George.

No doubt your political advisers have mentioned this to you by now, but just in case they haven’t, I thought I’d drop you a line.  The UK press are a funny lot. They will insist on making hay out of the budget every year (and let’s be frank, you like the attention), but you can never really tell which bits they’re going to ignore and which bits they’re going to put in the spotlight.  Take this hullabaloo over your decision to equalise the regular and old-age tax free allowances.  The ‘granny tax‘ (nice work on getting the Telegraph to rail against a Conservative chancellor, by the way).  There’s no way you could have seen it coming, right?  Right?

Wrong.

Really, George, it is quite simple.  Newspapers look for news.  Given all the leaks that you and the Lib Dems fed the media over the last couple of weeks during your bargaining, this was the only morsel, juicy or otherwise, that was left.  Here, I’ll spell it out for you:

  • If it is something new, it is more likely to be in the news (funny, that).
  • If it was in the news last week, it is less likely to be in the news this week.
  • If a loss is to be imposed on a group of people that are commonly taken to be sacrosanct, it will be the news.
  • A pound lost is at least twice as news worthy as a pound gained.
  • Furthermore, gains and losses are always described in whichever way looks more miserly.  That means:
    • Gains are expressed in real terms
    • Losses are expressed in nominal terms if they can be and real terms if they must

This whole kerfuffle hits every button on the nose.

15:17 I predict a Conservative-LibDem coalition

The Labour and Liberal Democrat negotiating teams finished a session around 13:30.  The Conservative negotiation team then sat down with the Lib Dems at 14:00.  Ever since then, there has been a steady stream of increasingly-senior Labour figures arguing against a Lab-Lib coalition, which suggests to me that they’re softening up the ground for a Tory-led government.

From the BBC Live stream:

14:26 Labour MP and former minister Michael Meacher says his party should go into opposition and “renew itself”.

14:30 The first Labour minister has openly expressed the feeling that a Lab-Lib coalition is not viable.

14:36 “We must NOT enter a deal with Labour,” writes Keith Nevols, former Lib Dem parliamentary candidate, on his blog.

14:43 The London Evening Standard’s Paul Waugh claims that in last night’s cabinet meeting Health Secretary Andy Burnham “broke ranks to give an ominous warning of the dangers of trying to concoct such an unstable alliance” between Labour and the Lib Dems.

15:12 Labour MP for Batley and Spen Mike Wood says “David Cameron should be PM”.

My prediction:

A Conservative-Liberal Democrat coalition, with major points along the lines of:

  • Strong support for Tory spending (cut) plans;
  • Freedom for the Lib Dems to oppose the Tory line on Europe and Trident, at the least;
  • Some mechanism to equalise the size of constituencies (which would help the Tories);
  • A referendum on Alternative Vote — a.k.a. Preferential Voting — for the House of Commons (which would help the Lib Dems);
  • No agreement on reform of the House of Lords;
  • The Lib Dems getting one mid-to-high level cabinet position (something like Home Secretary); and
  • An intention to keep the new parliament for at least two years.

The Lib Dems will desperately want two things:

  1. to have electoral reform enacted (presuming that they succeed in the referendum) before the next election; and
  2. to have an opportunity to be seen to be actively influencing policy in their favour.

Of course, the Liberal Democrats have their Southport resolution.  Any coalition must obtain 75% support amoung Lib Dem MPs, members of the House of Lords and executives of the party.  Nevertheless, I think that they’ll pull it through.  If nothing else, the prospect of the first Lib Dem cabinet position in a century will awaken the real politik in their MPs.

Previously on the UK electoral system: