Intriguing news tonight via Paul Waugh: Balls has brought in Gary Follis to be his new Chief of Staff. Before a brief stint in the real world, Follis was SpAd to Nick Brown (Gordon’s Chief Whip and Commander of the “Forces of Hell”). As talk of the Balls’ lasagne plots spread, Guido has to wonder how Miliband feels about “Nick Brown’s boot boy” returning to the fold. It could have been worse though, one exhasperated Labour staffer coughs “it’s the job he wanted to give to Damian. It’s still pretty much a declaration of war on Ed though…”

UPDATE:

While Guido was over at PoliticsHome, laughing at that development, he noticed that the latest chapter in the Aidan Burley Nazi-gate story didn’t take very long to fall apart. Burley was accused by a teenager on Twitter of sleeping during a Holocaust lecture. It turns out that the teacher who organised the trip, on which said teenager conveniently managed to recognise Burley, is a Labour councillor:

“After the lecture, Ms Reeves confronted Dr Smith and Burley and (wrongly) assumed the doctor was a Tory aide. Ms Reeves is then alleged to have told Smith and Burley that she knew Ed Miliband…”

Playing politics on a trip to Auschwitz. Stay classy.

Dennis Skinner just leaned over and asked Ed Balls "What is Lasagne, anyway?"
Ah…the virtues of good Northern cooking!—
Barry Gardiner MP (@BarryGardiner) January 31, 2012

Guido isn’t sure whether he believes this one, but it’s a great line anyway.

After the Mail ran with Sophy Ridge’s blog post about the Balls’ lasagne plot, it’s become the hottest ticket in town.

Skinner’s invite must have got lost in the post… 

Ed Balls told the Fabians that one of his most precious material belongings is a first edition of a Keynes pamphlet, “The Economic Consequences of Mr Churchill”. Keynesianism is the chosen intellectual mantle that Balls is trying to use with the Labour base to justify pivoting towards the voters and away from union demands for ever more deficit spending and borrowing. Already the Labour left are screaming “sell-out“.

Earlier this year Vince Cable argued that Keynes would not support the demands of latter day über-Keynesians. Cable reminds us that the politicisation of Keynes as a heavy spender is misplaced because Keynes was a liberal, not a socialist and he was writing at a time when the level of state spending in the economy amounted to half of today’s level. Keynes was not a friend of socialism, his policies were intended to save capitalism. Would Keynes have believed government deficit spending at twice the share of GDP as in the 1930s was desirable or sustainable? Cable thinks not, does Balls?

The proof will be in the policy pudding, Labour politicians reflexively oppose every reduction in welfare spending, they are conditioned to do no other. Even when senior Labour politicians know it is electorally toxic, for example opposing the £26,000 housing benefit cap, the “progressive” logic of maximum welfarism that grips their activists brooks no reason. Ed Balls can’t command credibility until he accepts that the deficit is a problem that has to be addressed rather than just acknowledged in theory. In interviews he now says vaguely that he wants to bring down the deficit, yet he is on the record during the Labour leadership election, where he ran from the left, as opposing even Alistair Darling’s modest deficit reduction proposals. Balls ideologically opposes as “too fast, too far” spending restraint by the Coalition. It is hard to believe that Balls isn’t now repositioning towards the centre again for purely electoral reasons, rather than some Damascene rejection of deficit denial.

Today sees the evil Fabians holding their “The Economic Alternative” conference and Ed Balls is the keynote speaker.  To raise the curtain he has an interview with Mary Riddell in the conference edition of the Fabian Review. Print deadlines however mean the interview was given some weeks ago when the party line repeated ad nauseuam was different to what it is this morning. In the interview Balls says of the Tory deficit reduction strategy “Nobody in the Labour Party should get into the idea that it has to be this way”.

What a difference to his Guardian interview this morning in which he claims “My starting point is, I am afraid, we are going to have keep all these cuts.”

Same line of questioning, very different answers. The reality of public scepticism regarding Labour’s credibility on the economy and pressure from Shadow Cabinet realists combined with the weakness of Ed Miliband’s authority has forced Ed Balls to switch to George Osborne’s ‘Plan A’. There is no alternative.

Ed got the inevitable thrashing at PMQs, though it was clearly worse than they expected. Yesterday Labour media grid was leaked, yet today we can see that they’ve had to throw it out of the window after a dire morning. The faces lined up for the media today were Harman, Chuka Umunna and Ed Miliband, yet Balls had to be sent to Millbank to clean up immediately after Ed’s defeat. How bad must it be when Blinky is the mop-up man… 

In the wake of the Mail on Sunday’s scoop about Tory MP Aidan Burley stupidly attending that stag party, the BBC have done a useful compendium of other similar incidents. They seem to have forgotten one key public figure who actually donned the suit himself though: the Shadow Chancellor. What a surprising omission…

Talking to Labour insiders, ambitious young PAds, think-tankers and old hands alike, the candid admission is that they are stuck with Ed Miliband because as with Gordon Brown, there is no-one else. Ed gets a regular mauling at PMQs despite a terrible economy, still looks and sounds like the kid who does the photocopying, has failed to impress the British public and is unable at this stage of the electoral cycle to push further ahead in the polls. His shadow chancellor can never win the argument, because the argument he makes is that the British public is wrong and because it is Ed Balls who is making the argument. Dislodging Ed Balls would risk fraticidal conflict and not getting him off the television screens will guarantee Labour won’t be given a hearing on the economy.

The Labour Party’s centrists and the realist operators who just want power have written off the 2015 electoral prospects of the Labour party under the two Eds. So it is against this backdrop that we should look at two new publications that have just come out. Labour’s Business written by Luke Bozier and Alex Smith argues that the party should be pro-business, it even has one brilliantly simple business-friendly idea that the government should steal immediately – small businesses should have one person as their point of contact at the HMRC. One person who is responsible for dealing with issues arising from the complexity of the myriad of taxes – VAT, NI, capital gains, corporation taxes and the like – burdening small businesses.

“In the Black Labour: Why fiscal conservatism and social justice go hand-in-hand” is a new Policy Network discussion paper in which the authors; Graeme Cooke, Adam Lent, Anthony Painter and Hopi Sen, call for Labour to embrace fiscal conservatism. Policy Network is backed by Peter Mandelson, so is not exactly a fringe ginger group. The paper can be seen as a direct rebuttal of the kamikaze economics of Ed Balls endorsed by Ed Miliband, which poll after poll shows is not seen as credible by the public. Despite the state the economy is in George Osborne is believed and supported by the British public.

The policy details in the two papers won’t worry their Coalition opponents, they will however be seen as part of a slow move back towards the electorally potent reality-based politics of New Labour, rather than the one-more-heave-to-the-left politics of Ed Miliband. Ed Miliband and those around him believe the electorate is moving towards the positions of the Occupy and UK Uncut activist groups, a strategic error that will guarantee them electoral defeat in 2015. If Labour’s reality-based wonks want to be in government before they are old men, they have got to either get rid of the Eds or convince them to tack to the centre. These are the opening salvos…

Ed Balls has popped up for a Five Live phone in. What’s the worst that could have happened? Well step forward Lee, a real life voter:

“It would be better for Labour and the country if you weren’t there… You were there in Treasury…you are the problem. When I hear you I just want to switch off because you have no credibility in what you say… the Labour Party would be better served, even if the message was the same, if it wasn’t coming from you, more people would listen. If you’re trying to get your message across it’s not working because you are tainted with what went before.” *

Victoria Derbyshire summed it up nicely “What Lee is saying is you, Ed Balls, are toxic”.

Radio gold…

*Guido was typing while listening and laughing.

UPDATE: It kept on going:

Caller to Balls: "You may have a credible voice now, but why didn't you use it when Gordon Brown was spending all the money?"—
Harry Cole (@MrHarryCole) November 17, 2011

Last week Guido reported that Ed Balls had tried desperately to get one of his Shadow Cabinet colleagues to employ the apple of his eye, Ellie Gellard, as their political adviser. They all refused based on her lack of non-Twitter related experience. Having written his cornier speeches and been his general bag-carrier, today Guido can exclusively reveal that Balls has sorted her out with an actual job, in the actual private sector. As a lobbyist with Tetra Strategy…

This change of employment may not mean an end to late night Soho drinking sessions for Ed and Ellie. James O’Keefe and Lee Petar who run Tetra Strategy were both mentioned by Balls in the leaked Telegraph documents that revealed the extent of Balls’ personal war against Blair. Their lobby shop came to attention when it employed the disgraced expenses cheat Julie Kirkbride, more recently they came under the full media glare when it emerged they had been the organisation behind the now infamous meeting between Adam Werritty, Liam Fox and defence industry businessman Harvey Boulter. Industry sources imply that Tetra “do dodgy” – representing Russian oligarchs, the Government of Dubai, NHS contractors and private equity firms. Guido has confirmed that Ellie will be starting there next week, thanks to Balls. As members of the APPC, no Tetra employee can be a holder of a parliamentary pass, and at this time of heightened scrutiny of links between lobbyists and politicians she will have to surrender her pass on Friday…

Guido did try to ask Tetra Strategy what was it about the sultry 21 year-old that first attracted the lobbyists to hire her, was it her intimate knowledge of union affairs gained from Charlie Whelan? Was it her Twitter campaigning know-how? No one was available for comment…