Asked Boris to explain fall in £ after leave poll lead. "The pound will go where it will in the short term". Concession of short term pain

— Harry Cole (@MrHarryCole) June 6, 2016

The 2015 general election result was a surprise to almost everyone.  After the event, those who had not predicted the Conservative overall majority hastened to explain why it had happened.  One of the prime underlying causes alighted upon after the event was Labour’s catastrophic reputation on economic competence.  Labour’s own pollsters found that Labour had a 39% deficit behind the Conservatives on this topic among those who voted.

That Conservative lead was hard-won.  The Conservatives had for many years made a virtue of taking difficult decisions, of having the bottle to stick with austerity and bring down the deficit, even when individual decisions were unpopular.  Ed Miliband’s retail offer politics, while individually popular, did not comprise an election-winning platform when the public believed that keeping the purse strings under control was of vital importance.

Jeremy Corbyn has made no attempt to try to change public perceptions of Labour’s reputation for spending.  So at present Labour is no doubt as far adrift of the Conservatives as ever in this key battleground.

If Leave wins, however, this is likely to change – not because of anything that Jeremy Corbyn does but because the Conservatives are likely to throw away their hard-won reputation for economic competence.

There is near-universal agreement among economists, even those supporting Leave, that there will be an economic shock in the event of a vote to leave the EU.  There is less agreement about the size of the shock, of course, with Leave-supporting economists inclined to minimise it and Remain-supporting economists inclined to maximise it – funny that.  But whatever way you slice it, if there is an economic shock it will come at a time when Britain continues to run a high deficit, even after years of austerity.

This potential cost can and has been estimated (unlike Michael Gove, I haven’t yet had enough of experts).  The IFS, for example, has put the figure at £20bn to £40bn.  That can and has been doubted by the Leave side, who in their usual charming way took the opportunity to suggest that the IFS were in the pay of the European Union when putting their estimate together.  But for present purposes it will stand as a mainstream estimate.

Such an economic shock would not go unnoticed by the populace.  It would coincide with a lot of market turbulence.  And then those abstract numbers would need to be converted into cuts in services or tax rises.

It would not take long for it to dawn on the public that instead of leaving the EU they could have had countless new hospitals and far more spending on schools with the money that had been foregone by that economic shock.  It will not take long because Labour politicians will be pointing it out relentlessly.  The economic shock will be portrayed as a Conservative choice to waste untold billions on a hobby horse rather than the everyday problems that the general public face.  Any suggestion that Labour is profligate with money would have an instant answer.  The Conservatives would have thrown away their single biggest advantage over Labour in an instant.

Trust is hard-won and quickly-lost, as the Conservatives found out in 1992 when the UK was ejected from the ERM.  If Leave win the referendum and the economic shock that most economists expect comes to pass, the Conservatives might very well come to look back on 23 June 2016 as Black Thursday.

Alastair Meeks