George Osborne has got his hands full with one setback after another.
He seems to attract criticism for his austerity policy, not only from Labour, which is expected, but from well established international financial agencies who are now openly questioning his stewardship of the British economy.
The latest blow to hit him hard is the downgrading of Britain’s credit rating by Fitch from AAA to AA. It follows a similar downgrade from Moody’s two months ago and leaves Standard and Poor’s as the only major rating agency not to have downgraded Britain’s creditworthiness.
The timing will be seen by observers as acutely embarrassing since it came a day after the International Monetary Fund publicly rebuked the chancellor and urged him to rethink his austerity policy.
Christine Lagarde, the head of the IMF, told him in no uncertain terms that he should be considering a way of adjusting the pace of fiscal consolidation, as growth is showing signs of abatement.
Earlier in the week, the IMF’s chief economist Olivier Blanchard warned that Mr Osborne would be ‘playing with fire’ if he continued with his present policies.
However, the Treasury as we have seen in the past two years is again playing down the latest downgrade, arguing that it was simply a reminder that Britain needed to tackle its debts. A spokesman said: ‘This is a stark reminder that the UK cannot simply run away from its problems or refuse to deal with the legacy of debt built up over a decade.’
Fitch themselves say the government’s continued policy commitment to reducing the underlying budget deficit is one of the main reasons the UK has now ‘a stable debt outlook’.
What a load of dross we are being accustomed to hear in response to any criticism levelled against the economic policy of this government, whose arrogance appears to gain momentum as their failures multiply.
Now that we have seen the chancellor cry at the funeral of his idol Margaret Thatcher, perhaps he can shed a tear or two on the way his management of the economy is heading. Some commentators who back him are saying that the chancellor is ‘not for turning’ referring to the well-known phrase describing the Iron Lady at the height of her power.
Well he should be so lucky for the comparison. Nothing he has touched so far has blossomed to give us a whit of hope that recovery is on the horizon. On the contrary, gloom and doom are knocking at our door with an added intensity so as to rob us of a good night’s sleep.
The chancellor has become the fly in the ointment. The sooner the PM comes to his senses and puts him to grass, the better his chances of saving his premiership.