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A sitter for Miliband, but he still can’t score
Even by the standards of a politician who is used to confronting adversity, last week was unusually grim for George Osborne. Setting aside tears at Baroness Thatcher’s funeral, economic developments at home and abroad were enough to make the Chancellor weep.

The International Monetary Fund scolded the Treasury over the pace of deficit reduction; Fitch, the ratings agency, removed the United Kingdom’s triple-A status; and weak domestic retail sales pointed to the possibility that Britain has slipped into a triple-dip recession (we will find out on Thursday).

On top of this, part of the intellectual underpinning for Mr Osborne’s austerity drive was, if not kicked away, shaken badly when a US university picked holes in research by two of America’s more feted professors, Ken Rogoff and Carmen Reinhart, which, they had claimed, showed very high state debts were a cause of low economic growth.

For Ed Miliband it must have felt like a flow of killer passes into an undefended box with an open goal before him. Surely not even a striker with two left feet could fail from there. And, yet, somehow he continues to miss the target more often than he hits it.

An Ipsos Mori poll in Thursday’s London Evening Standard found that an overwhelming majority of voters, 66 per cent, do not think the Labour leader is ready to become PM. Only one in four believes he is up to the job. What is his problem? Why can’t he smash the ball into the net?

The answer, perhaps, was delivered 24 hours later in the Independent newspaper, which reported: “Labour bets the house with pledge to outspend Tories”. That is, of course, a legitimate policy, but it will gain little traction until the party tells us by how much and on what.

It’s rare for me to agree with Tony Blair. He was spot on, however, with his observation that Labour has to do much more than simply say no to public sector cuts. It must come clean on reform of the social security system and the long-term affordability of welfare spending.

As Tom Harris, a Labour MP in Glasgow, bravely admitted, dependency on handouts was “killing” his home town. “We are the Labour Party not the Benefits Party,” he said. Listen to the screams from his Westminster colleagues over the Coalition’s cap on housing benefit (set at £500 a week, the average working wage) and you get his drift.

According to the Office for Budget Responsibility, social security benefits (not including net public sector pensions) will cost £180 billion this year, rising to £198 billion by 2017-18. Add on tax credits and the bill shoots up to £232 billion. This is by far government’s biggest commitment, dwarfing the £137 billion it currently spends on health.

The trouble is, millions, billions, trillions are lost in the fog of political rhetoric. Thus Labour invites us to believe that a fresh bankers’ bonus levy and the reintroduction of the 50p top rate of tax will foot the bill for a swift return to Gordon Brown’s Magic Kingdom. This is nonsense.

The bankers’ levy raised about £2 billion. There is reasonable doubt that the 50p rate delivered anything at all, but even on Labour’s own estimates it would not have produced much more than £3 billion. Between them, they add up to little more than a welfare rounding error.

This is Labour’s fault line, the crack into which its credibility vanishes, as pointed out by eminent psephologist John Curtice in a paper for the Left-leaning Institute for Public Policy Research. In his view, the crunch question in the general election of 2015 will be: “Which party looks best able to run the economy in the next five years?” According to 11 ComRes polls between August 2011 and February 2013, it’s not Labour.

Contrition for past mistakes goes only so far. Having admitted errors on immigration, banking regulation and budgetary matters (allow me to throw in welfare profligacy and defence procurement) Labour must explain how it will close the Coalition's £100-billion-a-year gap between taxing and spending.

Or does it intend to make it bigger?

Between 2003 and 2007, in what we mistook for boom years, Labour borrowed £160 billion. Its leaders were reckless in a time of plenty. If it is to be given a second chance, we need to see the small print. Is it higher taxes to fund more spending? Or will it be even more borrowing? And if there are to be cuts, whose heads are on the chopping block?

We know that what Mr Brown called “Labour investment” was, in part, “Labour consumption”. In a 2011 Fabian paper, Stephen Beer, who manages funds for the Methodist Church, concluded: “The investment-versus-cuts argument lost power when people began to doubt the returns they would get from 'investing’ their income via taxation.” These issues count because in order to form the next government, Labour must win over taxpayers in the three southern regions outside London where it currently holds just 10 out of a possible 197 seats. These are the people who pay the bulk of the £150 billion of income tax that makes up 25 per cent of the Chancellor’s annual revenues.

As the economics editor of the Guardian, no less, advises: credibility will not be regained “by promising to chuck money at every problem”.

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