The Edge

Richard Northedge takes on corporate finance

Darling didn’t say it

It is ironic that the chancellor’s Guardian interview blamed poor communication for Labour’s troubles – yet he failed to communicate clearly his comments that Britain faces the worst economic circumstances for 60 years and failed subsequently to clarify what he was trying to say.

To anyone who was alive in the 1990s, nevermind previous decades, it is clear the economy is not in its worse state since the 1940s.

Alistair Darling did not say we are in deeper trouble than in 1948, of course, but misreporting by media that had not read the interview and mischievous misrepresentation by political opponents claimed he did say it - and the misquotation has stuck.

So when the pound fell afterwards, Darling got the blame – even though sterling has been falling most days for well over a year.

If Darling knew much about spin he would not have made comments that could be so misconstrued. And having made that mistake he should have pointed out that, while the global economic conditions are the worst for 60, possibly 70, years, his skilled chancellorship should ensure Britain avoids the full effect – like a good captain ensuring his ship has a stable passage despite the seas being stormy.

He would have pointed out that far from the economy being worse than in the 1940s it is in much better condition that in the 1990s and cited the high unemployment figures, interest rates and inflation of that decade. If he had political skills, he would even have pointed out that it was the Tories who were then in government.

So Darling’s sin is not to have talked down the UK economy but to have provided ammunition for those wanting to accuse him of doing so. His sin is to be a chancellor who lacks the nous to avoid such pitfalls – and whose ability to run an economy facing such difficult conditions can be doubted.

If Labour thought it was being clever to claim to abolish spin when it replaced Tony Blair it was wrong: presentation is as important for government as for any business.

Darling did not cause the pound to fall – even if the economy was at a 60-year low, markets could work that out for themselves – but being blamed weakens his already weak position at the very time Britain needs a strong chancellor (though not a strong currency). It bodes badly for the future.



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