The briefing against Alistair got a little heated in the last week – “Why Darling is a menace to Britain” – William Rees-Mogg; “Darling’s confidence seems misplaced” – Anatole Kaletsky; Knives out as Alistair Darling loses trust of City in the Sunday Times and various other City scribblings. It had the feel of the briefing before the non-election, the authors of which were to varying degrees Ed Balls and Douglas Alexander.

Ben Brogan has been briefed on the Brownies’ hotline to throw a bucket of water on all this – the Brownies would say that wouldn’t they?

Since taking office Alistair has presided over lost data disks containing millions of mum’s bank account details, the capital gains and non-domicile U-turns plus the first run on a bank in living memory. Not good when Alistair has in truth already been dealt a very bad hand by Gordon; public and private debt is an albatross around the economy, consumer inflation is over 4% making it hard for the Bank of England to cut rates which is the orthodox solution to a credit crunch. In any event the tsunami of liquidity thrown at the markets so far has not removed the fear in them. Guido’s friends in the City all say it is bad with a capital “B” – we are seeing only the tips of the credit crunching icebergs.

Contrary to what Gordon endlessly repeats Britain is not well placed to weather the turmoil. We have a worse balance of payments situation than the U.S., we have a worse government deficit, the golden rule has been shattered, loss of confidence in sterling and the consequent fall is fueling import inflation. Stagflation is returning. The omens in the property market are very worrying.

So if Brown’s heir apparent, Ed Balls, wants to become Chancellor he would perhaps be wiser to bide his time, let Alistair take the blame for the coming 2008/9 slowdown / recession, then take the Chancellorship in early 2010. Putting him in a position to go for the leadership following a Labour general election defeat or claim glory for “rescuing the economy” if it goes well. Is Balls wise and patient enough to wait?




Tip offs: 0709 284 0531
team@Order-order.com

Quote of the Day

Andrea Leadsom told BBC Radio 4’s Today

“He’s made his views on Brexit on the record, and the problem with that of course is that the chair’s impartiality is absolutely essential. … He’s made his views known on Brexit… it’s a matter for him but nevertheless it’s a challenge and all colleagues need to form their own view of that.”

Sponsors

Guidogram: Sign up

Subscribe to the most succinct 7 days a week daily email read by thousands of Westminster insiders.