We have now just been told by the Treasury, with typical PR chutzpah, that government departments should prepare cuts, not just of 25% which is itself unprecedented, but of 40% which would be insane.   No doubt this is, in the way politicians usually manipulate bad news ahead of the event, to make people think, when the final tally comes out rather less, that the cuts were not really as bad as all that.   It’s also of course to open up a broader range of options for cuts – just in case the opportunity offers.

Worst of all, it’s keeping up the propaganda blitz driving us down the track of cuts inevitability.   Whilst Blair in 1997 had a once-in-a-century chance of radical reform to change the face of Britain – and blew it – the Tories in 2010 have a once-in-a-century chance of turning Britain back to its conservative past, and are grabbing it with both hands.   So who will now stand up for the real Britain?

LibDem dissenting voices, including Vince Cable’s, are now closeted in the claustrophobia of coalition.   The Labour Party, still unrecovered from the diversionary trauma of the Blair-Brown interregnum, has still not recovered its roots or what it is for.   Of the leadership candidates, Ed Miliband shows most awareness (or is most reported as showing awareness) of the need for a major change of direction, but even he has yet to spell out in specific concrete detail the fundamentals of a new approach to finance and the economy.

Yet never was such a voice more needed.   Even Ken Clarke, with almost casual effrontery, has just admitted that a double-dip recession is quite likely.   Paul Krugman, the Nobel prize-winner for contribution to economics, has just observed in the New York Times that we face, not the Great Depression of 1929-32, but more likely the Long Depression like that which followed the panic of 1873.   As he says, following the recent vacuous G20 meeting, none of the world leaders seem to understand that the real threat is deflation, not inflation.

We have already seen the amazing revival of hard-money and balanced-budget orthodoxy – the revival of the old-time economic religion so favoured, so disastrously, by President Herbert Hoover in the US in 1930 and by Montagu Norman at the Bank of England throughout the 1920s.   The UK, Europe and the US  are already well on the way towards the deflationary traps that have sunk Japan for the last two decades.   So who will speak for Britain at this time of imminent danger?

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