This just in from a Cowley Street co-conspirator:
This just in from a Cowley Street co-conspirator:
Interesting Party Election Broadcasts last night, the Tories were fear-mongering that coalition government would be all about backroom deals and horse-trading. This is of course what is conventionally known as ‘politics’. In the Tory broadcast a Clegg-like actor walked around Westminster offering dithering. Apparently if you vote Conservative you will get a decisive liberal-conservative government firmly rooted on the centre-ground of politics. If you vote Liberal on the other hand you could end up with a dithering liberal-centrist coalition government.
In the real LibDem PEB we had Clegg walking around Westminster offering change from the old politics, his first promise was an offer of “tax freedom”, a tax cut worth £700 to every taxpayer. Now 10 points higher than where they were when they started the campaign, the LibDems think their most attractive manifesto offer is a tax cut.
Tax cuts, the Cameroons told us, were the old politics that didn’t work with voters. All the Tories needed to do was to offer Obama-style “change” from Gordon Brown. In the words of Sarah Palin: How’s that hopey change thing working out for y’all?
George Osborne this afternoon is trying to convince us that a hung parliament will mean higher interest rates as investors panic and the gilt market plunges. Guido begs to differ, arguing that if on May 7 the Tories went into a “Change Coalition“ with the LibDems – the only party with a leader that admits we need “savage spending cuts”, when the Tories and Labour are being disingenuous in pretending otherwise – the City wouldn’t have a problem.
The hard evidence is clear; since the prospects of a hung parliament jumped after the first TV debate (the bookies now make it an odds on 64% probability) both the pound and the gilt market have rallied. Why? Well the City was worried about Labour being returned and kamikaze economics being implemented by Chancellor Balls. A Lib-Con “Change Coalition“ government with both parties committed to public spending cuts and rapid deficit reduction will actually cheer the City. Here’s the evidence so far:
The left hand chart is the probability of a hung parliament based on gambler’s bets, the middle chart is the gilt futures price and the right hand chart is the pound against the dollar. Osborne just quoted a number of investment banking analyst’s old notes, RBS capital markets analysis this morning concurs with Guido’s analysis:
Weekend press good for Gilts: a) talking up the Liberal Democrats right wing credentials and how they form more coalitions with Conservatives than Labour in councils, so allegedly not that Budget-negative/sclerosis if Con-Lib coalition, which is most likely outcome at this moment according to pollsters; b) polls shift 1-2% back to where they were pre-debates.
Osborne needs to switch on his Bloomberg terminal for a reality check, gilts are now yielding less than 4%, City confidence has risen as Labour’s polling figures have fallen…
A few weeks ago Guido asked a CCHQ insider privy to strategy “What is the negotiating strategy with the LibDems? Is it true Matthew Hancock is in charge of the strategy?” He laughed “the joke of the negotiation strategy is that there isn’t one. If we lose narrowly we’ll leave it up to Clegg to either support Labour or stand alone. Go on to fight a second election and hope to win more comfortably.”
What, Guido asked, if the differential is big? “Don’t be f***ing stupid.”
That LibDem negotiation strategy might be a higher priority nowadays. Hancock is the Tory PPC for West Suffolk and formerly George Osborne’s chief-of-staff, Cleggmania means the problem now has the attention of those above his pay grade. Last Sunday Guido sketched out a potential May 7 scenario, Tim Montgomerie was horrified, the feedback Guido got was more mixed – mostly it was sceptical based on contact with the LibDem grassroots. Left Foot Forward editor Will Straw mirrored Tim Montgomerie, telling Guido in Dimbley’s green room that it was just not going to happen, the LibDems were “progressives”. Well that is a pretty meaningless term, it has even been borrowed by the Cameroons for their agenda. The confusion in the ranks of Labour and Tory true believers is based on the experience of contact with Libdem activists, many of whom are way to the left of Blairites. The parliamentary party is not by and large left wing - it is centrist.
Clegg and the people around him are not of the left, Vince Cable is, but he is the exception. The Orange bookers and the Cameroons share key liberal ideological tenets – localism, decentralisation, transparency and a preference for market based solutions. On the need for “savage cuts” in government spending, accelerated deficit reduction and NHS reform the LibDems have been more honest than the Tories. Most Tories can live with LibDem manifesto commitments on tax (apart from the enterprise killing capital gains hike). They are singing from the same fiscal policy hymn-sheet.
There are real areas of discordance, in particular defence and foreign policy. Here the LibDems betray their liberal radicalism, Clegg is desperately trying to square grassroots weirdie-beardie antipathy to anything nuclear with being in the government of a UN security council member and nuclear power. Letting the Tories have primacy on defence and foreign policy and the LibDems have primacy on home affairs, localism and open government is the most likely compromise. It would also broadly reflect the electorate’s wishes.
We have come a long way in the last 7 days, the well connected chronicler of the Cameroons Matthew D’Ancona now says get real it is on the cards, Cameron tells the Observer the door is open and ‘One of the keys is the people who are liberal with a small L‘, Clegg tells the Sunday Times that “You can’t have Gordon Brown squatting in No 10″, Mandelson warns voters that flirtation with Clegg might lead to a Cameroon marriage. The public on the other hand always love a big wedding. The bookies make a hung parliament the strong favourite outcome with a 60% probability and give the Tories only a 37% chance of forming a majority government. Change is definitely coming and it will probably be in the form of a coalition…
See also : The Change Coalition
Having sworn blind that Lord Rennard was not involved in the Liberal Democrat campaign, Cowley Street looks a little silly this morning given The Sun’s dossier scoop. In a blunder, Clegg’s spinner John Sharkey’s notes on debate rehearsals – including how Clegg is being coached to imitate, yet slam, David Cameron, were left in the back of a cab.
Lord Rennard’s role in manifesto planning and organisation is referenced and amusingly, true to form, he was keen on involving token women. Less funny is the fact that Cowley Street staffer Phil Reilly lied to Guido. Yesterday he said categorically Rennard was in no way involved in Clegg’s campaign. Does he now want to retract that and apologise for lying to Guido?
Chris Rennard stood down as the CEO of the Liberal Democrats citing ill health. Nothing to do with the outrage caused by the £41,000 in expenses he claimed for his “holiday home” in Vauxall-on-Sea. Let’s not forget all those other skeletons in the cupboard too.
Well the rotund trougher is back. He was spinning for Clegg in Manchester and has been spotted going in and out of the Lib Dems Cowley Street HQ. When Guido put a call in to ask them what his official role in the campaign was the inept spinner replied “Oh I’m not even sure what his unofficial role is.”
So we know he is back but they have taken over an hour and still no response to what his official role is, how much he is being paid and whether he has recovered from the health reasons that saw him stand down… Still waiting for that return call.
UPDATE: So the official line is that Rennard was in Manchester in a “personal capacity” and “he is not part of our campaign team“. That doesn’t really wash given that the Manchester debate site was on lock down and someone would had to have cleared his pass. Is he also going in and out of Party headquarters in a “personal capacity”?
UPDATE: Cowley Street’s Phil Reilly has got himself into a right teenage rage with this one. He claims because he hasn’t personally seen Rennard in HQ he’s not been there, but that’s not what Guido’s witnesses say. The line has also changed to Rennard being a “guest of a media organisation” in Manchester. Everyone there was a “guest of a media organisation” – namely ITV who hosted the event.
As the howls of anguish seep out of CCHQ that the LibDems will keep Brown in, Guido begs to differ, there is that risk of course but it is not as great a risk as they claim. There is also a great prize on offer, Brown can lead the Labour Party over the abyss into electoral oblivion destroying the Labour Party as a party of government. Statist, redistibutive social democracy has now been tested to the destruction of the nation’s finances. This election now presents an historic chance to break the Labour Party.
As Tories scream and point to Lib-Lab councils and the bearded sandal wearing activists who want to ban the bomb and legalise dope for purchase in euros, Guido says look at the reality. Since Charlie Kennedy’s demise the LibDems have been moving quietly to the right on economics, have jettisoned a lot of their loopiest policies and the Tories under Cameron have moved towards the LibDems on civil liberties, the environment and localism. The parties respective policies are closer now than they have been for over half-a-century. Cameron is telling the truth when he says that he is a liberal-conservative. Nick Clegg is a former Cambridge Conservative who is now a Liberal. They fact is they are both instinctively liberal metropolitan modernisers.
“But they are weirdie beardies” cry the Cameroon girls and boys distastefully in CCHQ. LibDem activists may be, but the parliamentary party is not and it is the parliamentary party with which they would have to work with in government. Here is a vote map based on data from MySociety’s Public Whip showing how increasingly over the course of the last three parliaments the LibDems more and more vote with the Tories:
We are possibly entering into an era of multi-party realpolitik. Clegg isn’t stupid, he won’t want to prop up Gordon Brown, it would infuriate voters and betray his whole change message. He is going to prefer to do a deal with the other ‘change’ candidate. If Cameron together with Clegg play it right, they can destroy the Labour Party forever…
Imagine it is the afternoon of May 7…
The Tories have received 33% of the popular vote, LibDems 29% and Labour 24%, a strong 6% showing by the BNP concentrated in Labour heartlands has shocked the political system and given the party its first Westminster MP in Stoke, where Labour’s vote split. UKIP’s Nigel Farage has taken Buckingham, after two recounts, by 7 votes. Ed Balls has lost his Morley and Outwood seat to the Tory hero of election night, Antony Calvert. The SNP has made strong gains strengthening Alex Salmond’s claims for Scotland to be granted more self determination.
Due to the iniquities of the electoral system Labour is still the largest party in Westminster, just. Harriet Harman has demanded Gordon Brown resigns and announced her intention to seek the leadership, Miliband hasn’t been seen. Charlie Whelan publicly tweets blame on Mandelson’s electoral strategy and “corrupt Blairites” for Labour’s defeat. Alastair Campbell is bailed at West London Magistrates’ Court after his live on-screen 3 a.m. drunken assault on Nick Robinson.
After unofficial back-channel communications between Samantha Cameron and her third-cousin at Buckingham Palace all morning, the Queen’s Private Secretary calls the leader of the Conservative Party and asks him to come to the palace. The Private Secretary then calls Nick Clegg and asks him to come to the palace as well.
In what is the iconic picture of the election, Cameron walks out of his Millbank headquarters along the Thames embankment to 4 Cowley Street where Nick Clegg greets him and together they walk purposefully towards the Mall surrounded by photographers and cameramen as crowds cheer and many ask “which one is which?”
In what were reportedly good natured discussions all morning the terms of a “Change Coalition” had been agreed by 3 pm. Clegg as expected is Home Secretary and Deputy Prime Minister, Cable is Chancellor, Osborne takes his old sparring partner’s job at Business. Phil Hammond and David Laws are tasked with cutting spending and reforming taxation at the Treasury. Lord Adonis remains as the government’s Transport Minister, Frank Field returns to the Department for Work and Pensions, both take the Liberal whip. Chris Huhne, ominously for the coalition, chooses to go to the backbench rather than accept cabinet collective responsibility as Defence Minister.
The most difficult horse-trading over the coalition was of course over Europe and electoral reform. Hague went to the FCO much to the relief of the Tory base and Ed Davey becomes the cabinet’s Minister for Constitutional Reform (Douglas Carswell gets a promotion as his deputy with special responsiblity for localism). The leaders realised that they could not take their respective parties with them if they compromised on either of these two issues.
The average age of the cabinet is now 44, the centre-piece of the Queen’s speech is to be a Great Repeal Bill, undoing 13 years of authoritarian legislation and strengthening civil liberties, restricting the growth of the surveillance and database society. The Big Society reform programme promises to fundamentally re-balance state and society in favour of a smaller more open government. Cable promises an emergency budget within 30 days signalling tough action on the deficit. The gilt market hits a 3 year high and the pound rallies 12% on the close.
Norman Tebbit, who was by her bedside, blogs the sad news that Baroness Thatcher has passed away. Her last words were “Norman, they buried the Labour Party before me.”
Punters on Politics Smarkets says there is a 56% chance of a hung parliament…
As Comres joins YouGov in making the LibDems the second placed party, Graham Sharpe, William Hill’s spinner, emails Guido to say that seven out of every ten political bets they took were for a Lib Dem win :- ‘Pre-debate the Lib Dems would be doing well if one in every ten bet was for them, but their support turned from a trickle to a flood on Friday with a mass of modest bets of up to £100 pouring on them to win with an overall majority or to be the largest single Party, with the larger bets were placed by regular political pundits backing a Hung Parliament.‘ A hung parliament maybe, but backing LibDems to win outright?
If you are bullish about the LibDems here is how the punters rate their chances tonight from on Political Smarkets, the specialist bookies:
Cable looks cheap and worth backing at 21% given the polls are pointing to a hung parliament. Gordon would give him the chancellorship for a Lib-Lab pact at the drop of a hat.
Just perusing yesterday’s Lebedev Evening Standard in which they do a vox-pop to get the views of the man in the street on the golden boy of the moment, Nick Clegg. You know the type of article, a paragraph on a student, another about an office worker and the high earner is for contrast.
This article’s high earner is Bhanu Choudrie, he declares Clegg the winner and says that he will vote Lib Dem in the election. Which doesn’t surprise Guido seeing as he is one of the Lib Dems biggest and most controversial donors. Is he actually on the electoral roll?
The Observer says he is a non-dom who “has been accused of accepting tens of millions of pounds in kickbacks from an arms deal between an Israeli company and the Indian government.” So he is not all bad.
Along with his brother he has donated nearly £585,000 to the party in recent years. Despite coughing up a lot of dosh for them he say “the Lib-Dems don’t have much substance.” A very odd article, was it written by Lebedev himself? Who bumps into billionaire arms dealers in the street?
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International Moaning Day | Kathy Gyngell
Cameron Alienating Core Voters Without Attracting New | City AM
Andy Burnham Villain of the Week | Sun
London’s Laundry Business | NY Times
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Elvis Speaks | Nottingham Post
Dave Mocked | Sun
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Alan Rusbridger opines…
“One thing that Snowden has taught us journalists is that it’s essential to be paranoid.”