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Meeting the former Chancellor: Alistair Darling MP. By Noah Sin

by on April 27, 2012

White hair, glasses, and those rather odd eyebrows… From far away, I saw him slowly making his way towards the stage. Yes, it’s Alistair Darling

 

Within a year of becoming the Chancellor, Alistair Darling oversaw the biggest financial storm Britain had experienced in decades. With his boss and predecessor overlooking him demanding results, and the opposition and general public demanding relief, Alistair Darling effectively saved the British economy from the brink of collapse. However, given the largest post-war deficit he left behind, resulting in large scale public spending cuts, Darling is often discredited as chancellor. Today, he stands firm to defend his actions, still strongly believing what he did was the right thing to do.

 

Questioning Darling: “Why is Labour doing so badly?”

 

During the Question and Answer session, I put this question to him. “I wonder what you think about current Labour economic plan. Because you said when you left office that Labour needs a credible economic plan. Do you think Ed Miliband’s and Ed Balls’ economic plan is credible? And if so, why do you think they are doing so badly in the polls?”

 

Although Ed Balls clashed with Mr Darling on occasions on Labour’s future economic plan, Mr Darling still believes the Balls plan followed the one he left in 2010. He said very firmly, “As their economic policy is still the one I left, yes.” In fact, he predicted as the crisis worsens, “government economic policy will adapt”; George Osborne will change course. In terms of the politics of the question, he frankly admitted that this caused Labour’s defeat in 2010, in which the party “paid a heavy price.” On the other hand, he blamed the coalition for the six-month smear campaign whilst Labour was choosing its own leader. “The present government was hugely successful” in saying “it’s all our (Labour’s) fault”, said Darling. He drew on the example of the Exchange Rate Mechanism (ERM) for the Conservatives in 1992, which they took a generation to recover from. It will be no easier for Labour, and there is “no point pretending that it’s not an issue; it is an issue”

 

The Darling Legacy – 50p tax rate and Quantitative Easing

As the chancellor who endured Britain through the financial storm, Alistair Darling introduced a series of measures that are still kept in place by the current government. The most controversial was the 50p top rate of tax. For 10 years, New Labour kept tax rate no higher than 40p per pound, even when Gordon Brown was slashing the poor with the abolition of the 10p tax rate. The return of the 50p rate caused “red scare” for many businesses, fearing the Labour government would tax the rich recklessly. As the person who was responsible for this, Darling believes the government should not remove it right now if they truly believe “we are all in this together”. But he denied the tax rate is a return to Old Labour socialism. “I’ve always said your tax rates have to be kept competitive”, said Darling, “my views haven’t changed on that.” The former chancellor insisted it was a “temporary” measure, and that it will “come down at some stage.”

Another legacy of Darling’s was Quantitative Easing (QE). As chancellor he agreed with the Bank of England’s proposal to inject money into the crumpling economy, for as many times as needed. It is a measure that still goes on now and some economists fear the policy will become never ending. QE “must be a good thing”, said Darling, because he introduced it. But jokes aside, deep down, he did have “concerns about it”. For the current situation, the bank is conducting QE “in the hope that it is then lent to the high street. I don’t believe it is.” Mr Darling suggested for more than once, the country will come “to the day when we unwind these things.” QE was positive as a short term policy, but with its latest development, even Darling is no longer “sure if it is working.

The challenge of Heathrow  Darling: HS2 is “no substitute”

Apart from being Chancellor, Mr. Darling was also the former transport secretary. He gave the experience at the transport office to encourage the government to take bold steps in infrastructure in the face of future challenges. As for the problem of capacity at Heathrow, “the issues have not gone away,” said Darling. In recent months, politicians raised all sorts of different “solutions”. But Darling emphasised that “airport in the middle of the Thames (proposed by Boris Johnson)” is not the solution. “Airlines will not pay those charges” and it will cost the country a fortune. On the other hand, by denying the possibility of a third runway, the government is making “huge impact” on the already busy M4 which relies heavily on Heathrow. “Heathrow brings a lot of money into this country,” said Darling. He supports the idea of High Speed 2 (HS2) project which is underway. However, whilst “it is very nice to get to Birmingham 10 minutes before we presently do”, said Darling, it is “no substitute for Heathrow.”

No doubt, it was an extraordinary hour or so, meeting one of the most prominent figures in British politics. A chancellor viewed critically by the nation and blamed for the economic crisis by his opponents. Yet from his answers, he displayed to the audience that he was a practical chancellor, with strength to hold on to his beliefs, and the courage to take bold decisions. If ever given the chance to meet him, don’t miss it; maybe he will change your mind too.

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