The Futility Monster

He'll pointlessly derive more enjoyment out of your resources than you

The Forgemasters Debacle

Posted by The Futility Monster on July 27, 2010 @ 09:47

It's all very macho, but it always reminds me of that Simpsons episode. You know which one...

The more this issue is examined, the more I feel the coalition acted in haste, and now are repenting at leisure.

Think about it. Your first couple of days on the job. All that new power going to your head. An anger at the growing realisation of just how bad the government books are. Knowledge that Labour were spending shedloads of cash with no real idea if the bond markets were going to keep buying government debt. A growing realisation that maybe one or two Labour pet projects had been quickly shuffled through because they knew their time in office was drawing to a close.

And you spot this £80m loan to a British company that is doing very well already, thank you very much.

Faced with a target of £6bn to cut from this year’s spending, it was a no brainer. £80m is not much, but it’s better than nothing. Cut the damn thing. Next decision please.

But as everyone knows, things are never that simple. And even less so in politics.

After all, when you still have Vince Cable, who has responsibility for the banks, telling everyone that he’s going to look into ways to punish the banks if they don’t start lending to businesses, you really are sending out a very mixed message. If the banks are unwilling to lend, is it perhaps not a surprise that Forgemasters had to ask the government?

Meanwhile, while we’re being told that we just didn’t have £80m to spend, there is a new 1bn pot of cash, as David Willetts referred to on Newsnight last night, for “regional development”. Huh?

Oh, and there is £1.7bn for nonsense NHS reorganisation. And, presumably, money being held to finance yesterday’s changes to “democratise” the police service.

So the coalition government tried to make up other excuses, the best of which was the idea that the owners didn’t want to dilute their own investments. An excuse which has no apparent proof to it. Hmm.

It gets worse. Did the involvement of a Tory donor have any impact on the decision? Probably not, but it still looks bad. As I said, nothing is ever simple, and these coincidences are inevitable, and invariably make a government look a little sleazy. It will happen to even the whitest of white governments.

Then the continuing influence of Peter Mandelson. Sure, we shouldn’t pay much attention to him, but as a smooth operator, little stunts like this yesterday, and continued assertions that the loan was a good deal, good value for money, going to help the local economy, and would actually turn the taxpayer a profit, just put the top hat on the fiasco.

But when in a hole, keep digging. Politics does that to you. Even when you know you are in the wrong, the loss of face by admitting that, yes, this is a deep hole, and no, I do not have a way to get out of it, so would you mind awfully throwing that rope down, thanks very much, is just too much for a politician to bear.

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