George Osborne's political career has been dominated by the shadow of David Cameron, with whom he shared a common embarrassment in his past membership of Oxford University’s notorious Bullingdon Club. Both of them served as advisors to Conservative shadow ministers, both became MPs in 2001, and both considered running for the leadership in 2005. Osborne decided to stand aside and instead lead his friend David Cameron's successful campaign to restore the Conservative leadership to Eton. Osborne was rewarded in first the coalition government and then the Conservative government with the role of chancellor (i.e., finance minister). He used that role to extend his powerbase within the party, but his political career stalled after the referendum defeat for the remain cause that he had so clearly espoused. He was not an Old Etonian, but attended St Paul’s the third most prestigious English private boys school after Eton and Harrow.
Osborne was an absent presence in the early stages of the campaign, which may have been a deliberate attempt by Cameron to keep the attention focused on the prime minister the United Kingdom had elected just 9 months earlier. Osborne was preoccupied with preparing his budget, which was due on 18 March, just shy on one month into the referendum campaign. Osborne revealed the evidence of the supreme confidence in the remain campaign, by being willing to to enact a controversial budget that involved reducing the bill on disability benefits by 4.4 billion pounds.
Politically it was a disaster. Osborne’s relentless pursuit of ever more savings from public expenditure led him to announce a 4.4 billion pounds assault on disability benefits. This was the final straw for the long serving Work and Pensions Secretary Iain Duncan Smith, who resigned and alleged that the chancellor would take money off anybody except wealthy Conservative pensioners. Although the proposed cut was quickly abandoned it all but ruined Osborne’s hopes of succeeding Cameron as Conservative leader.
After the budget fiasco died down Osborne entered the referendum fray, but by this stage he was deeply damaged. Exactly one month after that budget he used a Treasury report to state that Brexit would cost each household £4300 per year by 2030. He was not taken seriously because as a chancellor his department had not been very good at accurately forecasting the economy. He was also displaying political naivete in that if had expressed the figure as over £4000 it would have communicated better. More crucially he made it much harder for Labour voters to hear the economic message from a chancellor who wanted to slash disability benefits. Worse was to come when Osborne shared a platform with his Labour predecessor Alistair Darling. Between them they declared that a vote to leave would require an emergency budget of 15 billion pounds in tax raises and 15 billion pounds in public spending cuts. The media reaction was biting with this being seen as a punishment budget that was no more than an empty threat to force the electorate to vote remain. It was seen as a sign of how panicked the remain campaign had become and of how inept Osborne was as a political campaigner. The threatened budget together with the attempted cuts to disability benefits were fatal to Osborne’s leadership hopes and he did not put his name forward as a candidate to replace Cameron. More crucially in a tight referendum result that was swung by the poorer parts of England and Wales those budgets may have cost the referendum. In reality he should not worry about that too much as that would place too much responsibility on politicians and there is limited evidence that they had as much influence as they and the media pundits like to think.
In addition to his own interventions Osborne was responsible for gathering two reports from the Treasury (the first of which made the 4300 pounds claim) and encouraging remain supporting statements from business leaders and international authorities, such as Christine Lagarde of the International Monetary Fund and Mark Carney, Governor of the Bank of England. These interventions would prove of little avail as they led to immediate accusations of foreign interference and abuse of position in the media reporting their words.
Osborne was responsible for joint interventions with Wolfgang Schauble and Christine Lagarde, with the former particularly problematic Osborne was subsequently discovered to have been prompting Schauble to intervene. George Osborne led David Cameron’s 2005 campaign to become Conservative Party leader and was his assumed successor. The previous Labour administration had been known as the Blair Brown government as it had been dominated by the years of Tony Blair as Prime Minister and Gordon Brown as Chancellor. Brown then succeeded Blair as Prime Minister in an unopposed leadership election after many years of a media frenzy over a breakdown in relationship between the two. The allegation was that Blair had promised Brown to eventually stand aside and let Brown replace him, but was changing his mind and wanting to cling to power. Despite Blair’s fall from grace over the Iraq War and Brown’s uninspiring tenure as prime minister it provided the template for the Cameron Osborne Conservative administration.
The problem with seeing the chancellor as prime minister in waiting is that it does not allow the current prime minister to change Chancellor when the economy begins to founder. By contrast Margaret Thatcher replaced her first term chancellor Geoffrey Howe with Nigel Lawson after winning the 1983 general election. Osborne’s failing as chancellor was to have just one policy, driving down the government deficit, and was probably responsible for killing off the United Kingdom recovery in 2010. Had Cameron not seen Osborne as his natural successor he might have moved his long term friend to another government post and appointed a more growth oriented chancellor. In the end it was Osborne’s monotone economic policy that killed off his leadership hopes, although his full fall from grace was brought about by his campaigning for the remain side in the European Union referendum.
Osborne initially remained aloof from the referendum campaign, which Cameron had launched into with gusto after announcing the referendum date. That may have been because Cameron insisted on dominating the remain argument in those early days or it may have been Osborne’s wariness that arguing too strongly for remain would ruin his chances of leading a very Eurosceptic party. When Osborne did enter the fray it with an over the top litany of economic forebodings, culminating in a joint platform with the last Labour chancellor in which they threatened 30 billion pounds of tax rises and spending cuts if the electorate voted to leave the European Union. That so-called punishment budget ended what little hope Osborne had of leading the Conservative Party and when Theresa May became prime minister one of her first acts was to sack him from the government.
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