- The macroeconomic effects of such a move, there's little evidence that a rise in private spending will replace the fall in public spending. The demand side consequences of this could drag us further into recession.
- It's not known whether the fall in tax revenues is temporary or permanent, if tax revenues rebound then the current (large) deficit will not be so much of a problem.
- The long term effects of debt are exaggerated and ignore the twin effects of inflation and growth on the real value of debt. Additionally, the cost of servicing debt is low and investors are still keen to buy government debt.
The Conservatives have pushed their "cuts are inevitable" line, because they know it has a common sense appeal, it sounds like a calm and level headed approach to the recession and has gained traction with the general public (even if the economics behind it are highly questionable).
What Darling has done is not only publicly disagree with his party leader, he has disagreed in such a way that it assists the Tory line of attack. Phrases such as "the voter's aren't stupid" and "talk sense" are just the kind of phrases that will help reinforce the Tories "cuts are inevitable" argument. An argument which is both highly questionable economically and will help justify policies with devastating social consequences.