The curious return of Liam Fox (or why everyone wants tax cuts but George)

So “disgraced former Cabinet Minister” Liam Fox is back today with a shopping list of requests/demands for the Chancellor that seeks to re-inforce his position as the would-be leader of the Tory Right.

Obviously the most prominent battle cry from the now Werrity-free Fox is for spending cuts to go further and faster – proof (if needed) that the most savage cuts in living memory are still not considered “red meat” enough for the Tory benches, a terrifying prospect. Considering the current impact on the economy of Osborne’s no growth plan (with only a small percentage of cuts so far implemented), Fox is like a backseat driver urging his speeding friend to go further, faster – and ignore how hard the car is to control at that speed…

Registering similarly high on the predictability register is Fox’s call to scrap further rights for workers. Presumably spiralling unemployment isn’t spiralling quickly enough for the Doctor. Perhaps he wishes to see that go further and faster too. What easier way to do that than to make it easier to sack people? It all fits in with his involvement in Aidan Burley’s (yes…him) TURC campaign. So far so right wing.

But enough on what’s predictable. What about what was a surprise?

Tax cuts.

“Surely not?”, I hear you cry. “Tax cuts are always demanded by the Tories. The endgame of shrinking the state is to offer bumper tax cuts to the middle classes and buy a re-election. Isn’t it? So how can Fox’s call for tax cuts possibly have been a surprise?”

Well…tax cuts, almost by definition, cost money. The need to be funded either by a further reduction in spending, a temporary increase in borrowing or higher taxes elsewhere. That’s three possibilities that the chancellor seems resolutely against, and looks unlikely to implement in the budget. Besides, after so much time spent saying that he must stay the course and wouldn’t waver from “Plan A”, how could he so blatantly adopt a “Plan B”? Especially one designed to solve the (no) growth problem he has created and sustained.

So is this a broadside against the Chancellor? Perhaps. Take with a pinch of salt the friends of Fox and Osborne in the media who will seek to play down the significance of this intervention. This is exactly the kind of “right wing outrider from the backbenches” stuff the PM was trying to avoid by keeping Fox in the cabinet. But what’s more significant still is that everyone now seems to want tax cuts to stimulate growth (albeit significantly different kinds of tax cuts). David Laws is also on clearly sanctioned manoeuvres for the Lib Dems. Ed Balls was advocating targeted tax cuts at the weekend. It seems that everyone now agrees that tax cuts are needed, because everyone sees that the lack of growth in the economy is the overriding problem.

Except George Osborne.

Who is starting to look rather lonely – and in denial – trapped between his own rhetoric of staying the course, and the clamour for something (anything) to get growth going. A rock and a hard place indeed…