On Monday what looked like a rather arcane economics spat broke out between the Conservatives and Labour. Once again, it demonstrated that as long as the debate is about economics, the Conservatives benefit, even if Labour are drawing attention to how they are, by some measures, failing.

The spat was essentially about how the Conservatives were trying to push through some ‘declamatory’ legislation (i.e. not backed by any sanctions if not delivered) committing the next Government to eradicate the budget deficit by 2018. Only, instead of eradicating the absolute budget deficit (which includes spending on capital infrastructure such as roads and flood defences), the Conservatives only committed to eradicating the current budget deficit (day to day tax revenue and government spending). This meant Labour were comfortable signing up to this legislation, meaning in theory they didn’t fall into the trap of being shown to be weak on deficit reduction. Except they fell instead into a different trap.

It was driven by a response by David Cameron in response to Ed Miliband’s speech last week, in which Miliband set out how Labour would attack the continuing current deficit in a ‘fairer’ way than the Conservatives. Miliband committed Labour to eradicating the deficit slower than the Conservatives would, which, he argued, would make sure that doing so wouldn’t choke off growth. Cameron pointed out that in the absence of any commitment to any cuts, the risk was that the deficit would actually grow and thus the national debt would too. Cameron pointed out that the minute the financial markets lose confidence in the UK Government’s ability to deal with its’ debt, bond rates will rise, the bill for debt interest will rise, and Labour would have to make serious emergency cuts to the NHS and all their central shibboleths, as has happened in Greece as they have come to terms with their debt crisis.

The problem for Labour is that whatever the truth, the public opinion polls still blame them overspending and not balancing the books before the financial crisis came. The public opinion polls acknowledge that whoever caused the global financial crisis (and Labour’s lax regulatory regime for the banking sector didn’t help), the fact that we went into it after 11 years of growth without a decent budget surplus to spend on stimulating the economy made the national debt far worse than it needed to be.

It is because of this that despite pointing out how the Conservatives have missed their target of eradicating the budget deficit in this Parliament, despite pointing out how the Conservatives are switching back and forth between using the deficit as a % of GDP, and the deficit in cash terms, whichever says they have reduced it the most, Labour lose out in the polls whenever the economy is mentioned.

Which brings me back to the essential point. The Conservatives are very happy to lure the debate during this election onto the economy, because it is causing political palpitations within Labour whenever it happens. In order to sign up to the legislation committing the next government to eradicating the deficit, Labour are committing themselves to cutting spending. They have to. They are committing themselves to austerity in a way that will cause them some serious electoral trouble.

Why? Because, for the first time in living memory, left-leaning voters have a place to go. In Scotland, they can go to the SNP, who are saying they can end austerity and have even made it a condition of them supporting any Labour-led coalition. In England, they can go to the Greens. In Wales to Plaid Cymru. In the UK, they can simply not feel they have anyone to vote for any more.

It is because of this that as long as the debate is on the economy, the Conservatives may be able to win the most seats with only 35% of the vote. Yes, the Conservatives may have their own 35% strategy too. The key is for Labour to lose marginal seats because of a drift to the left or to not voting. It may push Labour down to about 30%. In that case, 35% of the vote for the Tories should be enough to win on seats.

What Labour need is some time in Government again, even if it is a small amount of time before another election (which may have to happen much sooner than the five years that legislation has fixed it at). During that time they can prove themselves to be trustworthy on the economy, and not have this constant refrain of “don’t give the keys back to those who drove the car over the cliff” aimed at them. They need this badly, because when even pointing out the failures of the government on the economy is bad for them, there is a big problem.