So, the suggestion that the replacement of David Laws by Danny Alexander might tilt the coalition leftwards is now officially looking like a StabPrin Bad Call.
As Tom pointed out, the big surprise this week was that the OBR has turned out to be rather more independent than its makers would have liked. We posted on its role back in May; there are some things about it, at the technical level, that are reasonable ideas. For example, it provides Bank of England Inflation Report-style fan charts showing a range of probabilities rather than point estimates.
Recognising uncertainty and forecast error is sensible - if, of course, you actually do it. But that’s not what has happened; the briefers came out after the OBR reported to say that the budget process would now “focus on the structural deficit”. In other words, “These are my figures - if you don’t like them, I have others.” It’s worth noting that Paul Krugman detects the same tendency to come up with any argument you like so long as it involves cuts among Angela Merkel’s economic advisers. For once, the Tories are perfectly European.
Chris Dillow points out that if you apply the methodology of the OBR, you have to accept a significant probability that there is no need at all for further fiscal tightening, and that the notion of the structural deficit is so dependent on your assumptions that it may be meaningless. For the rest, Whitehall Watch points out that the OBR forecasts the deficit coming down by more than half without additional policy inputs.
So here we go. More detail is here; it’s especially interesting that Nick Clegg has become the cuts cheerleader. In the light of the OBR report, and the subsequent final budget numbers, it is surely indefensible to make assertions like this:
Deputy Prime Minister Nick Clegg, a Sheffield MP, told the BBC he was "angry" that they had had to take the decision to cancel the loan "because of the dishonesty of the outgoing Labour government making promises to the people of Sheffield, raising false hopes among the people of Sheffield, making pre-election bribes with money that didn't even exist".
This may be explained by the notion of costly signalling - the best way Clegg and Alexander have to demonstrate their commitment to the coalition is to lead the slash-and-burn exercise, in the hope of one day getting their praps-maybe vote on sort-of PR.
Department of Health officials said this project – which has taken five years to develop – was targeted because it was entirely publicly-funded. Two other hospitals, in Liverpool and London, were saved because they will be PFI schemes.
Here’s the Tories’ Reconstruction: our plan for a stronger economy (PDF):<blockquote>PFI debt will no longer be hidden off the government’s books</blockquote>
Here’s Gideon, back in March 2007: <blockquote>“Gordon Brown’s trick of using PFI to hide debt off the nation’s balance sheet is catching up with him.”</blockquote>
Black is white; freedom is slavery.
Meanwhile, Brad DeLong’s shrillness has only increased.
(Didn’t Dave from PR once claim he was a big fan of the Jam?)