Political commentators used to look at living standards,
measured in financial terms, to try and explain the results of elections. This
association of political fortunes with economic circumstances has now become
conventional wisdom. And political parties have reinforced this presumption by
claiming credit for improvements in living standards (if the governing party)
or laying blame for deterioration (if the opposition). Government
responsibility for determination of the country’s economic situation is allowed
to go without saying. And yet, by allowing this, we, the electorate, are
insulting our own intelligence.

Any British government is powerless when it comes to
determination of international market prices for important necessities such as
energy or food. Nor can it affect decisions about interest rates in the
Eurozone or the United States. Or anything to do with China.

This is not to deny that government is a significant
economic actor. Not only is the state responsible for providing the
infrastructure within which both businesses and households carry on their
everyday existence but it also arranges for delivery of health and educational
services as well as disbursing alms to those whose ability to work for a living
is compromised by mental or physical frailty (mainly the elderly). Altogether
government accounts for about 40% of national income.

But for as long as sterling is maintained as a sovereign
currency the context for government economic policy is determined by the
exchange rate. Unfortunately, scandalously even (by defiance of the Nolan
Principles), official economic analysis is developed in denial of this fact.
See here for a summary of this situation.

Presenting the General Election as a choice in terms of
economic policy is fraudulent. As regards economic policy there is nothing to
choose between the main parliamentary political parties: the Government
(Conservatives and Libdems) and the Opposition (Labour) are agreed that the
analysis and judgements offered by the Office for Budget Responsibility should
dictate the scope for public expenditure and taxation. To vote for any of these
parties is to guarantee that the official assessment of the country’s economic
situation goes unchallenged. Since the OBR’s assessments are based on a tragic
misperception of the country’s economic situation it is not possible for a
truly coherent and effective policy to be developed and implemented by any of
these parties (whether alone or in combination). In these circumstances, to
vote for any of these parties is to connive with a public act of collective
self-deception.

Of course it’s possible to believe that economic policy is
unimportant, or that other government policies deserve to be developed along
certain lines rather than certain others, irrespective of the economic context,
and that expressing a preference for one political party over another is
justifiable in these terms. But I expect the economic context will be given priority by the parties. And expecting party place-persons to put citizens’
interests before the interests of their own party places seems to me a misplaced act
of faith.

And in the context of a ‘hung parliament’ it also seems
optimistic to expect that what any Coalition Government actually does will
reflect proposals put to the public in any manifesto. For example: a
Labour-Libdem Coalition Government would be likely to legislate for
constitutional changes introducing state funding of political parties along the
lines previously suggested by the Electoral Commission. Ed Miliband’s only
significant reform of the Labour Party has been to base trade union funding on
members’ decisions to opt in to political funding rather than allowing a system
of default consent to operate: this reform was a pre-requisite specified by the
Electoral Commission, and by adopting it the Labour Party removed the only
major obstacle to the scheme previously officially recommended. Since these
proposals would align state funding with electoral results (votes) all the
minor parties likely to be represented in the House of Commons would assist in
carrying the proposition. Also likely to be smuggled in with this change would
be an introduction of proportional representation (probably in the guise of
House of Lords reform). It is doubtful whether the introduction of these
changes would involve a referendum: more especially so if it’s a
Labour-Conservative Coalition. That’s not to say these are not sensible
reforms, for which a credible case could be made: it’s just an example of the
sort of thing the electorate should get used to being given by government (i.e. no choice), as
coalition is more overtly established as the permanent political context.