Westminster Blog

Alex 10.50 Final post. An intriguing tweet from Evan Davis. Did any of the candidates actually win this debate? Or was it a dead heat? The polls indicate that Cameron prevailed. But the numbers are suspiciously close to broad voting intentions. Could it be that the public reverted to the person they were intending to vote for at the begining of the debate? I suspect few people would have had their opinion changed by the last 90 minutes. It will be interesting to see whether the post-debate spin has more of an effect.

Alex 10.47 Some final thought from Alan Schroeder, our US debate guru.

Debates do not always produce clear verdicts, and in my opinion this one qualifies as a three-way stand-off. Judging purely on optics and not on substance, I would call this Brown’s best debate of the three. I thought he handled the Mrs. Duffy gaffe with deftness, and I liked his lawyerly closing argument. Even Brown’s goofy smile at the very end came across as endearing rather than menacing.

Cameron has never quite come into focus for me in these debates. He’s obviously an intelligent, thoughtful, and well-spoken man, but from my perspective he doesn’t leave much of a footprint. That criticism notwithstanding, I would also call tonight Cameron’s best debate, and I wouldn’t be surprised to see him do well in the snap polls.

Clegg has consistently been the most interesting performer of the three, but tonight he seemed to be drawing from the same familiar well instead of broadening his message. One wonders if Clegg’s surprise win in the first debate may have caused him to peak too soon. A strong finish in round three might have given Clegg, in the immortal words of Spinal Tap’s Nigel Tufnel, “that little extra push over the cliff.” Instead, he allowed both Cameron and Brown to make gains on him.

Jim 10.46 Clegg should also brace himself for a row tomorrow over his claim that 80 per cent of immigrants into Britain came from the EU. Apparently the real figure could be much lower; closer to a third.

Jim 10.43 Also, how come no one mentioned Gordon Brown’s Achilles Heel – ie his claim to have extinguished “boom and bust” permanently? And how come the other two didn’t nail Clegg over the LIb Dem policy of joining the euro? And did Cameron have a lucky escape in not getting grilled over his opposition to rescuing Northern Rock?

Alex 10.32 One thing to note. Was Vince Cable ever mentioned? What happened to the great Lib Dem economic titan? Had the economy been the topic of the first debate, we’d have heard Clegg repeating his name ad naseum. Shows how much his confidence has grown as leader. He don’t need little old Vince any more.

Alex 10.28 The punters are backing Cameron after this debate. The chances of a majority are up 3 per cent on Betfair, the online betting exchange. Now stand at around 40 per cent, which frankly is remarkable given it was a hot favourite a couple of months ago.

Alex 10.25 Alastair Campbell is going on the offensive over these snap polls. “I don’t give a damn about your poll,” was the line to one interviewer. He’s now just gone on Sky to allege that the polls say whatever the people commissioned them want to see. Strong stuff. I’m sure he would have said exactly the same if Brown had come out ahead.

Alex 10.20 POLL FLASH: COMRES. This is quite breathtaking.

Cameron wins the debate — Cam 36, Clegg 33, Brown 26

But look at the voting intention — Con 36, Lab 24, Lib Dem 36.

Neck and neck.

This must be a historic low for Labour. And a historic high for the Lib Dems.

Jim 10.18 Weirdly, Lord Mandelson has just used the phrase I mentioned in the last paragraph, claiming that Brown carried off a “barnstorming performance”. Is he reading my mind? Unfortunately it may prove hard to spin a victory for Brown.

Jim 10.15 Rumour coming through that David Cameron won – according to first opinion poll from YouGov.

Here it is: Cameron at 41 per cent, Clegg at 32 per cent, Brown at 25 per cent.

Bad news for Brown, whose team had widely pre-briefed that he would come out on top because of his supposed mastery of economics and finance. The prime minister needed to come out with a popular barn-storming performance to regain any electoral momentum. That isn’t what happened.

Alex 10.00

Well that that’s it folks. All over. Time to decide. This was a closely fought debate, if largely unenlightening on the deficit. Because of the limitations on Dimbleby’s interventions, most of the issues were discussed on the politicians’ own terms. This was a very familiar discussion for old hands in Westminster. Not sure if that would have helped the TV ratings.

Cameron did well. This was his most relaxed and fluid performance to date. He took on Clegg — often with the help of Brown. He engaged with the audience. His answers were relatively crisp. But there was no killer blow, no point where he showed up Brown, and there were moments where the worm was unimpressed. Most worryingly for them, voters didnt take to his pitch on cutting NICS and the line that a vote for the LIbs is a vote for Brown.

Clegg stood his ground. No big mistakes. As a long-serving Lib Dem correspondent, I felt this was the Clegg I recognised from the pre-Cleggstacy days. He was a bit tetchy at moments, prone to waffling, a few flashes of passion. There were certainly some questions where he shone — the worm was dancing with joy over some of his tax plans. But I’m not sure this is the man the public fell in love with in the first debate, who was more measured and relaxed. That said, he did enough I expect to maintain some of that Debate premium in the polls.

Brown. Well, as good as it could have been. But probably not enough. No attempt at humour that will run in the news bulletins. This was a man across his brief, a bit gruff, a bit dismissive of the others. You’d probably trust him to do your cricket club’s accounts. But he didn’t do enough to make the country think again. The Great Infallible Worm was pretty indifferent for most of it, even when he was on the attack. I’d be surprised if he has a big jump in the polls from this.

Jim 9.56: It’s winding up time.

David Cameron says “I love this country”, “family is the most important thing in society”, “keeping us safe and secure is the most important thing of all”. And he wants to look after the most frail and the “poorest”. Stupidly, I had thought this debate was going to be about the Portuguese downgrade and the Athens fiscal crisis. I was wrong. (Alex points out that when DC criticised the Lib Dems the worm nosedived).

Nick Clegg says change is still possible. “We can change Britain for good”. Calls the Tories and Labour “the old parties”, yet again. “I will work tirelessly to deliver fairness for you”, he says. This “fairness” thing is starting to get on my wick. “This is your election, your country….choose the future you really want”. Worm good.

Gordon Brown is not in a great position to offer change. Raises the spectre of Cameron, “perhaps supported by Nick Clegg”, in office. But the Tories would put the recovery “at risk” with an emergency Budget. Criticises Cameron’s inheritance tax cut. Accuses them of cutting child benefits, slashing policing and damaging health. Gordon, Gordon – this is not positive politics. You should have learned from Obama. Worm asleep.

Alex 9.50 A dispatch from George Parker, our political editor in the Spin Room:

It’s absurd, Mandelson has walked into the room and is surrounded by a huge mob of journos and camera crews – about half the room seems more interested in him than the debate. What’s he doing here, 15 mins before the end? Unless he thinks GB is losing it and wants to distract attention??

Chris 9.48 (Who is now shouting at the telly)

I’m getting cross now. Earlier in this campaign I pointed out that when David Cameron talks about National Insurance as a “jobs tax”, the Conservatives’ economic adviser had a paper published in the Economic Journal which showed the relationship between such taxes and unemployment is small. Now Nick Clegg is banging on about how the Institute for Fiscal Studies have said his tax plans were best at rewarding work. All I can say is that the response of employment and unemployment to these sorts of tax changes is really really small. All academic studies show this. This should not be something politicians make absurd claims about.

Jim 9.47

Alex mentions that the worm is not very friendly to Brown. However, my view is that this debate could not have come at a better time for him; it reminds us of the prime minister pre-Duffygate – serious, dull even, but seemingly sincere. And this 90 minutes maybe helps to wipe clean the slate from yesterday….up to a point, of course.

Alex 9.45 Cameron keeps on saying that Clegg doesn’t have a welfare policy and he has a point. It is one of the Lib Dem policy areas that remains very left wing, a no go area for the Orange Book modernisers. This is part of the reason why Clegg keeps on talking about tax cuts as an incentive for work, which seems to be going down well with the Great Infallible Worm.

9.42: The view from the US: Alan Schroeder’s opinion.

This is one of those debates in which post-debate interpretations will matter. Many viewers will have a difficult time sorting through the thicket of policy references, statistics, charges, and countercharges—a lot of this discussion is pretty arcane. The press will have an important role to play in clarifying, fact-checking, and holding the debaters to account.

I too am puzzled by the physical accoutrements of this debate. Why didn’t the producers just stick with the natural setting of the Great Hall, rather than impose an artificial and incongruous backdrop? At least the live audience feels part of the production this time, unlike the two previous programs.

Although all the debaters appear animated tonight, at the halfway point I don’t see any of them breaking new ground. Brown was wise to acknowledge the Mrs. Duffy kerfuffle right off the bat, because it quickly vanished into the background. Otherwise each candidate is playing to type.

Chris 9.41

Gordon Brown’s big claim to fame and economic competence is Bank of England independence. Now he seems to be claiming that his policies will “keep interest rates low” and that is a good thing. I thought having interest rates at 0.5 per cent was a sign of economic failure rather than success.

Alex 21.39 Welfare. Politicians love benefits crackdowns. It is victimless tub thumping because most benefit scroungers don’t vote. But the truth is that forcing people to go on work schemes or take jobs tends to have little positive effect. Indeed, on Pathways and the Flexible New Deal, many welfare to work providers say that forcing individuals actually makes it harder to help them. This is bogus politics, a narrative that is aimed at appeasing prejudices, rather than tackling the root cause of these problems.

Jim 9.31 Housing:

Cameron is claiming that more houses can be built by scrapping top-down targets. That’s a controversial premise (the housebuilders hate the Tory “nimby-friendly” proposals to let communities determine their own schemes – I am more open-minded). He slates Lib Dem plans to stick VAT on new homes.

Clegg is saying that empty homes should be re-used. It sounds great but many of the half a million empty properties in Britain are deserted for good reason; they’re barely habitable.

Brown claims the housebuilding industry has not “served” Britain well. He boasts that there are 1m more homeowners than there were 10 years ago. Talks about shared equity schemes.

Shouldn’t one of them raise the question of whether we are back in a new housing bubble – prices have risen more than 10 per cent in the last year, mainly thanks to low Bank of England interest rates. Shouldn’t alarm bells be ringing again.?

Er, not according to Gordon Brown. He wants interest rates to remain rock bottom as long as possible. Clearly he may not have learnt the lessons of the bubble.

Jim 9.29 Chris has sent me a link to his article showing the decline of manufacturing under New Labour. It’s a devastating piece of original work.

Alex 9.24 We’re on immigration. The worm was in the heavens over Cameron’s pitch. But it also seemed to like Clegg’s robust response to the challenge over the amnesty. Brown, meanwhile, seems to be flatlining, regardless of how good his answer is delivered. Oh…spoke too early. Now the angry Clegg pitch on dealing with illegal immigrants is not going down well with the audience.

This is clearly a big issue for the public. But it is the third time that a substantial portion of the debate has been dedicated to it. Is that fair? Surely when we’ve got a £163bn deficit, at least half of a debate should have been devoted to this crucial issue. The next government will spend 80 per cent of its time cutting the budget. Immigration will be a sideshow.

Alex 9.21 Chris has dug up a great chart for us. This shows how Labour has been the part of redistribution since 1997. Its tax and benefit changes have taken from the rich and given to the poor.

Chris 9.20 The two people watching this with me keep commenting on David Cameron’s chin. Why is it so shiny? Is it nerves and sweat? or a failure of makeup?

Jim 9.14 An interesting debate over the decline of manufacturing in Britain. Neither Clegg nor Cameron hit Brown with the killer fact: that manufacturing fell faster (as a share of GDP) under New Labour than it did under Thatcher. (I can’t find the link but this was a Chris Giles FT frontpager last year). Were the opposition leaders not properly briefed?

Meanwhile Brown pulled out some seriously spurious statistics about the jobs he was set to create: 400,000 in low carbong industries, half a million in digital industries and 100,000 in biotech. We questioned Brown’s use of data for green job predictions on this blog a while ago. In effect he is waving his finger in the air.

I have to pull up Clegg as well, however, for claiming that RBS loans funded the Kraft takeover of Cadbury’s which – he said – led to job losses. As I remember, the factory at Keynsham near Bristol was already earmarked for closure long before the talks began.

Alex 9.08 All of them seem to have honed their tactics through the debate process. They all look relatively relaxed. They’re all looking at the camera. Every audience member is named. This one will be a much harder debate to call. It shows why in the US the trend has been for the first debate winner to usually benefit most from the series.

Alex 9.07 Chris tells us there was no blackout at the Giles household. Our TV went down. And the BBC internet feed. Perhaps it was some pro-Euro sabateurs who didn’t like Cameron’s line of attack? It is intertesting, by the way, that Camerron has chosen to be more aggressive on Europe in this debate. In Bristol he played it relatively safe, for fear of the party looking too eurosceptic I guess. This attack on Clegg was much more direct.

Jim 9.03: Blackout. Blackout! The BBC executives must be having kittens. That wasn’t part of the script. Meanwhile I thought that Cameron’s point was quite good when Brown claimed to have got all heavy with a senior bank executive. He asked if it was Fred the Shred – the RBS chief executive who was given a knighthood by, er, Brown’s government.

Jim 9.02: Following up Chris Giles’ point: I was amused but unsurprised that none of the politicians replied – when asked how they would cut taxes: “Are you out of your mind?”

Chris 9.01

This is going to make me unpopular, but it does get my goat when politicians and the public talk about taxes being “unfair”. What does it mean? Fairness in taxation is entirely the result of a democratic process. Just for the record. The British tax system takes from the rich and gives to the poor more in Britain than in almost any other advanced economy. Many would be surprised by this, but it is partly because our income distribution is so unequal that the tax and benefit system has to be so redistributive. This is a technical issue as much as one of fairness.

Chris 9.00

Tax credits is a subject that ususally bores people, but Nick Clegg has just raised the important point about their administration. Labour’s change to make these assess on annual income in 2003-04 was an administrative blunder which has created the situation where millions of families get presented with a bill because their tax credits were over-paid. Previously tax credits were paid for six months on a fixed-rate basis, which was easier to administer. This will resonate with the public

Alex 8.55 Here is the contrary view. The worm seems to love Clegg again, at least in parts. This is perhaps the toughest debate for him. And look — it has just spiked as Clegg said “you are right Dina, taxes and unfair” in a rather firm tone. The worm also got excited at his proposal to get the parties together to discuss the deficit reduction, so cross party cooperation that also plays well in polls. By contrast the dial was unmoved by Cameron’s plans to reverse the national insurance tax rise. (Perhaps they don’t understand what National Insurance is — see Danny Finkelstein for more.)

But in general I think all three candidates are doing pretty well so far. No killer blow. And certainly no insights on cutting the deficit. But in performance terms they are all coming off fairly well.

Jim 8.53: Brown pointed out that his national insurance rise wouldn’t hit anyone earning under £20,000. I thought Cameron’s riposte was very neat; suggesting that Labour think that anyone over that salary is “rich” and therefore a target for higher taxes.

Tonight I’m not so impressed by Clegg, he seems slightly peevish and prone to generalities. Happy to hear a contrary view.

8.52 Tim Harford, FT economics leader writer (and author of The Undercover Economist):

Nick Clegg’s line about everyone getting together sounds nice – but too late for the voters. Perhaps the Lib Dems could be unilaterally honest? Is it really necessary to get together with other parties before any of these guys will explain their plans?

Chris: 8.51 This is an early view from a respected City economist who wishes to remain nameless. “Gordon Brown cites the 1930s, the 1980s and the 1990s as big “mistakes” in terms of fiscal policy.
GDP growth was strong in all three cases (thanks to weaker £)”

Chris: 8.50 Gordon Brown keeps talking about the Tories wanting to “shrink the economy”. Even those who think the Conservative policy is nuts do not think they actively want to create a recession. He seems to forget that the government has tightened fiscal policy more in 2010-11 by far more already than the £6bn extra the Conservatives propose with vat and income tax rises. How can he say that a £12bn fiscal tightening promotes recovery, but an £18bn tightening risks a double-dip recession.

Alex: 8.48 What is this strange background? The colours keeping on shifting. And when it turns purple the makeup on the candidates makes them look rather pink.It was almost as odd as the question on how the leaders would cut taxes as Britain struggles with the biggest deficit in modern times.

Jim: 8.43 Is it just me or does Cameron’s hair seem to be rather more slick than usual? It reminds me of that famous shot of him as a young Treasury adviser. He’s claiming that all businessmen back his plans. Maybe; maybe not.

Meanwhile Clegg is trying to play the consensual card once again. He’s said that after the election the chancellors of each party should gather with the Bank of England and FSA to discuss what needs to be done. All very well but it sounds a bit like coalition; which is not music to everyone’s ears. Did you notice how Clegg said to the other two: “Can we move away from the critical point scoring?” Again, trying to take the high ground. To my mind though, his line about injecting fairness into everything that is done – while putting £700 in everyone’s pocket (really? just like that?) – sounded like meaningless guff.

The purple haze background is making me feel a bit dizzy. Effective line just now from Cameron saying Labour had “put up tax 178 times”.

Chris 8.42 All three leaders are in fantasy land with regard to spending cuts. Nick Clegg highlighted tiny spending cuts in defence and passports that do not get anywhere near the scale needed. In his opening statement, he also seemed to protect hospitals and schools from cuts, so much for not ring-fencing anything. Gordon Brown did not mention spending cuts at all of any significant size. David Cameron mentioned the Conservative spending cuts of roughly £4bn – far from the starting £46bn needed in the first three years alone.

Alex 8.40 From Philip Stephens:

what’s cameron got against china…….in the second debate he was warning about its nuclear intentions and now he’s saying we should stop buying their goods?

Alex 8.37 Sorry to make this point again, but the worm really doesnt like the talk of spending cuts. It falls like a stone, while Gordon Brown’s promise to basically protect all “frontline” public services went down like giving away keys to a sweet shop. Cuts may be necessary but they don’t appear to be good politics. I’d encourage all the people on turning their dials for the BBC worm to try our deficit buster asap.

Jim 8.35: As Alex predicted, Brown got his joke in straight away, saying that the job of prime minister was difficult and “as you saw yesterday, I don’t always get it right.” He also predictably said he had prevented recession turning into depression. And he warned that Europe faces great peril, with a risk of Britain going back into recession. His main argument: If we help the economy now we will have the resources to tackle the deficit later.

Alex 20.33 A solid start from Clegg. Honest on the deficit, crackdown on bankers, cut taxes for low and middle income earners, change the economy. The audience reaction worm loved the banker bashing, tax cuts, but dipped on the line about honesty on the deficit. (Hmm.._)

Jim 8.32: Cameron’s pitch is very straightforward, getting the word “change” in in the first sentence. He wants to reward work, get banks lending and “start making things again”. Hard to argue with any of that. He also mentions Greece as a dismal warning sign for Britain entering the euro: A Tory government would never do so.

Alex 20.30 Honey, who shrunk the candidates? They look very small in the great hall.

Jim 8.23: We haven’t even mentioned Greece yet: the biggest issue of the week, with global and European financial authorities trying to work out a rescue package for the Greek economy – and a downgrade for Spain – sending shudders through financial markets. Other countries are now under great scrutiny; Ireland, Belgium, Portugal and Italy among them.

Some economists are also worried about the UK, US and Japanese deficits. We keep hearing what Brown did during the credit crunch. What are his plans for dealing with a sovereign debt crisis? I’m not quite sure. Same with the other two.

The problem for all three leaders is that for Britain to avoid any kind of similar fate the government needs to set out a credible path to cutting the structural deficit, and swiftly. But that much honesty just days before a general election could be fatal to electoral prospects. Thus the long fudge we have endured for months over how to tackle the £163bn deficit.

Alex 8.15 Did you know Nick Clegg was a bigger international star than David Beckham? (Well, at least for a few days.)

Take a look at this graph of google searches, which has Beckham as the green line and Clegg as yellow. (Again, click to enlarge.) Note the spike after each of the debates. Remarkable what a hour of prime time telly can do.

Jim 8.08: In case you’re stuck for drinking games during the event, how about a tot for any of the following rather predictable sentences:

Brown: “By removing £6bn from the economy at this critical time they would jeopardise the recovery.”

Clegg: “We were the only party to predict the crash.”

Clegg: “We will put £750 back in your pocket” (as he mimes putting money in his back pocket)

Cameron: “Labour’s jobs tax will put the recovery at risk”.

Cameron: “We will be tough on waste and tough on the causes of waste.”

Brown: “We took the right decisions during the crisis. The Tories opposed us at every turn.”

Brown: “This is no time for a novice.”

Brown: “I agree with Gillian (Duffy).”

Jim 8.02: And finally, to confirm our impartial reputation, what about the Tories? As Brown likes to point out, again and again, they had their reservations about nationalising the banks, a policy which turned out (it seems) to have been the right one:

Jim Cousins: Does he believe that a brief period of public ownership—days, weeks or months—would be in the taxpayer’s interests? George Osborne: “I am not in favour of nationalisation, full stop.” (Banking (Special Provision) Bill, House of Commons, 19 February 2008, Cmn 185/186)

This Tuesday Ken Clarke became the first senior Tory to admit the party got this wrong:

Jim 7.57: In case you think we’re being unfair to Brown, let’s turn to Vince Cable (Clegg doesn’t usually talk much about the economy) and his reputation. I’ve always thought he was the best of a bad bunch of MPs in seeing the warning signs that Britain was in a major financial bubble. That hasn’t stopped a rightwing backlash against his reputation. In case you missed it, here is the Andrew Neil interview that left him hot under the collar: the tough questions included why Vince opposed quantative easing and then backed it. “Isn’t the biggest myth of this election your reputation?”

Jim 7.49: While we’re on the subject of the prime minister, here is a reminder of the moment where he inadvisedly told the House of Commons that he had “saved the world”.

Jim 7.45: The reason I personally believe Brown cannot possibly win tonight is because the others will string him up with his old claim that New Labour had somehow eradicated “boom and bust“. He will of course claim that he took the right decisions over tackling the credit crunch – despite Tory suspicion of such state interventions. But the fact that he was the man in charge of the Treasury during the bubble just can’t be wished away. Here is a video of one of the first times Brown used the famous phrase; many more would follow in subsequent years.

Alex 19.40: Chris Giles, the FT’s resident economics guru, has blogged on his “wish list” for the debate. (He’ll be joining us later to offer some thoughts and debunk some myths from the debate.) Most of them call for a dose of honesty, so I suspect Chris may be disappointed. Here’s a sample:

• Make no new public spending pledges or commitments
• Accept that reductions in government waste will never solve the budgetary crisis
• Spell out some serious spending cuts that need to be contemplated

One point he didn’t mention was tax. My wish list would include them offering no promises to rule out specific tax rises and an acceptance that tax will have to go up in the next parliament. Afraid I left the rest of it with the tooth fairy.

While we’re on the subject of the inevitability of tax rises, I can’t resist republishing this graph from a post earlier this week. (Click to enlarge.) It shows how Ken Clarke and Geoffrey Howe tackled Budget deficits through hiking up taxes. Expect the next chancellor to do the same.

Alex 19.25 What should Brown do? Mark Penn, the US pollster who ran Hilary Clinton’s campaign, just gave a bit of counter-intuitive advice on Sky. “Gordon Brown knows he has to go out there and tell a good joke,” he said. “He has to go out and make them laugh.” A tall order. But it is the right approach. I’ve been going on about this all day to anyone who will listen. He has to make us think about the Duffy fiasco in a completely different way. “I agree with Gillian,” or some such will let us know that he’s human and can laugh at himself. It’s a bit like the Reagan moment, when he was under pressure over his age. That said, Brown is no Oscar nominated actor. His timing is dreadful. But he has to give it a shot.

Jim 7.16: Our new comrade Alan Schroeder, authority on the US presidential debates, is emailing us his thoughts from his TV screen back home in America. (Alan joined us in London for the first debate). In case you’ve not heard of him, Alan wrote a book – “Presidential Debate: 50 years of high-risk TV” – which many MPs and broadcasters read during the lengthy negotiations to set up the three debates.

I wrote a lengthy magazine piece about this last month: concluding that one of the three would definitely regret taking part. All we know right now is that that person is most definitely not Nick Clegg.

Here are some of Alan’s initial thoughts:

Clegg has fared extremely well in these debates, though to a significant extent his success stems from the comparative weakness of his two rivals. Incidentally, Cleggmania has now washed up on American shores, with a spate of recent articles in U.S. newspapers detailing the out-of-nowhere appeal of the Lib Dem leader–and inevitably citing the “no more than 30″ notches on his bedpost.

Finally, a quick complaint from across the Atlantic: Is it just my imagination, or is the BBC trying to prevent overseas viewers from watching this debate? Checking the homepage of the main BBC website this morning, I found no reference whatsoever to the debate, even though it’s an in-house production. According to the programming schedule for BBC America, while Britons are enjoying the live three-way verbal joust, American viewers will be treated to reruns of Gordon Ramsay’s The F-Word. Fortunately, several internet sites (including the excellent American political network C-Span) will be live-streaming the leaders’ debate. But where’s the BBC when you need it?

Jim 7.05: And as for Clegg and Cameron. It will be a battle between the two younger men to show who can sound most convincing, positive and authoritative on issues of finance and the economy. Clegg won the first round. Last week it was pretty much neck and neck. Who comes out on top tonight could play a significant role on election day.

Incidentally a friend of mine has just come back from a one-week holiday in Spain which turned into a three-week break because of the volcanic ash. “It is very weird to come back and find people seriously talking about Nick Clegg – he was a joke less than a month ago,” he observes. Indeed. Political currents can move in swift and surprising directions.

Jim 6.49: So much for the deficit. What about the three leaders? I wonder how they’re feeling ahead of tonight’s debate. Alex is just wondering how Brown is going to deal with the aftermath of his “bigot” gaffe; when he slammed an innocent 65-year old, Gillian Duffy, who had the timerity to ask him a few questions.

Funnily enough she has shed more light on the fiscal situation than most front bench politicians. Duffy asked the prime minister when he would deal with the deficit and whether folk faced “tax, tax, tax” for years to come. Couldn’t have put it better myself.

As you all know, the incident – and Brown’s excruciating apologies – appear to have put a spanner in the wheel of Labour’s election campaign. Or, to rephrase another Duffy:

The question is: Will Brown find a way to defuse the embarrassment early in the debate: a joke, perhaps? Or will he just pretend it never happened. The opposition parties have been restrained in attacking him over it – they realise he is in a big enough hole already.

(According to one opinion poll from YouGov tonight the incident has not had any impact on Labour’s ratings: there must be relief in Victoria St.)

Alex 6.45: And then the IFS came out of the traps on Tuesday. The respected think tank suggested in a stinging report that none of the three main parties had identified more than a quarter of the cuts which needed to be made in the next Parliament. The politicians claimed this was naughty because it ignored their “efficiency savings”. But then, efficiency savings – as the famous quote in Yes Minister goes – are the “oldest trick in the book”.

Jim 6.38: Well, it’s not as if other people haven’t tried. On Monday we had the FT deficit calculator, invented by Alex, which showed the true extent of cuts which would have to be made in the next four years (if taxes didn’t go up instead). So far more than 20,000 people have “played” with the device; I imagine they were left as horrified as we all were.

A reminder: The £30bn-£40bn of required cuts could require, for example:

a 5 per cent cut in public sector pay; freezing benefits for a year; means-testing child benefit; abolishing winter fuel payments and free television licences; reducing prison numbers by a quarter; axing the two planned aircraft carriers; withdrawing free bus passes for pensioners; delaying Crossrail for three years; halving roads maintenance; stopping school building; halving the spending on teaching assistants and NHS dentistry; and cutting funding to Scotland and Wales by 10 per cent.

Alex Barker 6.37: So Merv has provided a dose of much-needed realism ahead of the debate?

Jim Pickard 6.35: Good evening and welcome to our third and final live blog of Britain’s first ever TV debates. This time the subject is on familiar ground for the FT: the economy. So we are all pretty excited about the three-way clash. That’s not to say that we expect to get many answers to the biggest financial issue of the day: the deficit. But there should be sparks and heat even if not light.

If you haven’t seen it yet, Mervyn King has made some pretty strong comments, predicting that whoever wins the election will then be out of power for a generation because of public anger over the cuts that have to be made during the Parliament.

It emerged today that the governor of the Bank or England recently confided (to US economist David Hale) that there would be a severe backlash as the next government grapples with the £163bn deficit.

“I saw the governor of the Bank of England [Mervyn King] last week when I was in London and he told me whoever wins this election will be out of power for a whole generation because of how tough the fiscal austerity will have to be,” Mr Hale said.