Cable the Jeremiah

Vince Cable The business secretary relishes his reputation as the "sage of Richmond'

The script's already been written.

The leader will call on his party not to lose its nerve. He'll urge them to finish the job they've begun. A vote billed as "crucial" will end in victory for the leadership and defeat for those party activists who want a change of policy.

That, at least, is how Team Clegg are presenting Monday's debate on the economy at the Liberal Democrat conference.

There's just one problem. The man most people think of when they think about the Lib Dems and the economy is refusing to be part of the plot.

Vince Cable, the business secretary and formerly his party's shadow chancellor, will take no part in the debate.

He won't speak in it. He may not even vote (although we are assured that he does back his leader's position)

Vince Cable believes that this is an unnecessary fight. He thinks that if Nick Clegg really wanted to he could reach a compromise with party activists who are calling for economic policy to be "re-balanced" to "raise employment and growth".

In part this is a row about presentation.

Nick Clegg fears that his party would let the Tories "hoover up all the credit" for economic recovery if they give the appearance of wanting to change economic policy now.

That's why he will declare on Monday that there is "one thing that both George Osborne and Ed Balls want - for us to throw away our economic credibility". He will tell his party conference "Don't do it"

Vince Cable, on the other hand, relishes his reputation as the man who warned about the economic crash - the man mocked here as "the sage of Richmond" and described by the prime minister as "a perpetual Jeremiah" after his recent warnings that things may not be as good as some Tories are suggesting they are.

There is, though, substance to the argument.

The business secretary has long argued that the Treasury is manned by officials obsessed with a hairshirt approach to the economy.

He has fought to persuade his coalition colleagues to spend more on infrastructure and to free local councils to borrow more in order to build more houses.

He fears that another housing bubble could lead to an increase in interest rates choking off recovery.

He thinks policy makers need to be ready for the moment the Bank of England decides to scale back its support for the economy. If monetary policy does less, then fiscal policy - tax and spend - may need to do more.

Before the summer Lib Dem MPs debated their economic policy. Vince made his case and lost.

One source close to the party leadership claimed there was a vote in which Clegg's position got 55 votes and Cable's just two.

No wonder the sage of Richmond doesn't want to play any part in Monday's pre-scripted confrontation between his leader and his party.

Update Monday 10am: I am now told that no vote was held after a debate about economic policy at the Lib Dem parliamentary meeting a few weeks ago. However, sources close to both Vince Cable and Nick Clegg agree that the Business Secretary did urge the party to be prepared to relax fiscal policy if the recovery wasn't sustained. Mr Cable is said to have had the support of just one other Lib Dem MP. Mr Clegg persuaded all the others. So, it was 55 versus 2.

Nick Robinson Article written by Nick Robinson Nick Robinson Political editor

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  • rate this

    Comment number 138.

    But whether markets or Republican govt, capitalism or criminality the solution is surely to take the whole finance industry, from top to bottom into public ownership and under egalitarian democratic control
    Which should be the main platform on finance for the new left wing party
    You'll hear it was possible then, back in the panicky day, but if it was possible then, it is still possible

  • rate this

    Comment number 137.

    135 Yep, they were paying their mortgages by withdrawing equity from their homes during the housing boom.

    When the boom ended and Greenspan's interest rate hikes kicked in, they lost their homes.

    They had them. Then they lost them. Because Bush's insane govt wouldn't take on their mortgage payments nor limit those payments by law

    These subprimers had to be disciplined, to accept lower pay etc

  • rate this

    Comment number 136.

    It's obvious that Cable only really belongs in a LibLab coalition. If the Tories start to rally in the final run-up to the election, it isn't hard to imagine him urging Liberals to back Labour in certain marginals.

    Which is why I think Clegg and Cameron should jointly look for an opportunity to sack him, sooner rather than later.

  • rate this

    Comment number 135.

    132. PhilPolEcon
    Sub-prime lending did not give the poor homes, it miss-sold the poor mortgages with back loaded interest rates that they did not stand a cat in hell's chance of paying when the higher rates kicked in.
    It then packaged up and re-miss-sold same as investments.
    No doubt it gave the US mortgage broker sharks shed-loads of sales commission to cushion them through their recession.

  • rate this

    Comment number 134.

    130,132 So Cable gave a RIGHT WING account of the crisis:
    The irresponsible subprime poor who shouldn't have been bailed out
    The responsible banks who took risks & deserved to be bailed out.
    Govts spent too much on welfare. Since their spending couldn't be matched by taxing the rich more that, welfare spending had to be cut
    That's why Cable supported & supports the unelected undemocratic Coalition


Comments 5 of 138


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