You may have noticed how Ed Balls has become invisible recently, he has shut up and gone into hiding. And here’s why. Ed was a member of the last, totally incompetent, Labour government that let spending get totally out of control and who then tried to blame everything on the banks. Now, as shadow Chancellor, he has been spouting criticism at the government as it tries to fix the enormous problems that he helped to create.
The government is modestly trimming back the state to the level that it was just a few years ago and has raised taxation a bit. It was forced into these actions by the dire situation Labour has got the country into. There was no alternative. In fact even after the spending cuts and tax rises we are still borrowing like crazy (equivalent to Â£6,500 PA per UK household), we are relying on economic growth to eventually close the gap.
Yet Ed was saying that we should not be doing this. He said we should be borrowing more and spending more. Exactly the policy that got us into trouble in the first place. And ignoring the fact that our financial credibility is so bad that the international financial community would make it very difficult and very expensive to borrow that money. Ed is into deficit denial and the country is in the last chance saloon.
But now the international financial community has stiffened it’s stance even more. The PIIGs have come home to roost. Even the United States of America has been forced into a $4 trillion deficit reduction. Market sentiment has hardened massively against countries without credible deficit reduction plans. To the point where what Ed was proposing has lost even the slightest shred of credibility. The Emperor has lost his new clothes. Ed Balls is cut off from having any viable policy he can put forward. And the coalition government has been proven be doing exactly the right thing.
As if there were ever any doubt.