Cameron on the deficit: popular with the CBI but what about the voters?
It is striking that Cameron has felt under enough pressure on his austerity line to devote a large section of his CBI speech today to defending himself against the charge that his plans would damage the economy. Something the TUC have been saying ad nauseam. He has also now rebranded his budget plans as being about growth rather than cuts.
But Cameron didn’t answer one of the hardest questions: when exactly will he start reducing spending? Of course the deficit needs to be brought under control (and there are all sorts of ways and means of doing this) but the economic impact of such efforts will be very different in 2010 when the economy is still very fragile and in 2012 when things may well be more robust. The implication of Tory statements to date has been that cuts need to happen asap, this speech seems to have muddied the waters with no clear indication of where the Tories now stand.
The speech also continues with the “everything for everybody” approach that characterised Cameron’s interview with Andrew Marr yesterday. In fact, far from indicating that growth will result from simply reducing the deficit and cutting taxes, he specifically mentioned three areas of growth which will certainly require serious public investment if they are to happen in a big way: green growth, massive skills improvement, and infrastructure upgrade.
This will all please the CBI: cut business taxes, reduce the deficit by hitting benefit claimants, pensioners and public sector workers while maintaining lucrative public contracts for CBI members and spending public money on training their staff. Selling it to the public may be a lot harder though. It simply doesn’t look fair and voters generally like fair.