The Tories should be toast. The words spoken by Jeremy Hunt to the House of Commons on Thursday, along with the forecasts of the Office for Budget Responsibility, should be enough to ensure that we are in the final stretch of what will have been 14 years of Conservative rule. Given that politics turns on economics, and that the dominant question of any election campaign is a version of the one Ronald Reagan asked of Americans in 1980 – “Are you better off now than you were four [or 14] years ago?” – the Conservatives should be heading to a crushing defeat in 2024. The economic outlook could scarcely be bleaker, with every measure pointing towards gloom. Real household incomes will fall by a calamitous 7% over the next two years, plunging living standards back to the level they were at in 2013: nine years spent pushing the boulder up the hill, only for it roll back down in 24 months. Forget the crash of 2008, the fall in incomes projected for the next year alone will be the steepest since records began in the mid-1950s. Meanwhile, Britons will be paying more in tax, as a share of national income, than at any time since the end of the second world war. The recession that is coming may not bite as deep as the one that struck in 2008, but it will be wider, affecting everyone. The experts warn of a food bank winter, with the cold, hunger and stress that already afflicts the – staggering figure – 14.5 million Britons in poverty spreading to those we once called the squeezed middle. The next two years will see another 500,000 Britons become unemployed, while any pay rise for those in work will be eaten up and outstripped by inflation. One estimate says real wages will not rise to their 2008 levels until 2027: that suggests Britain will have suffered not just one lost decade, but two. The front page of the Daily Record put it succinctly: “You’ve never had it so bad”. All this economic pain for the country should spell political agony for the government in charge. Not least because, despite the chancellor’s valiant attempts to pretend Britain’s problems were “made in Russia”, voters know that the hole we’re in grew much deeper eight short weeks ago. That was when Liz Truss and Kwasi Kwarteng delivered a budget which spooked the markets so badly that Britain is no longer trusted to make its own fiscal decisions. Instead it is on probation, with Hunt obliged to tax high and spend low to reassure the moneymen whose loans the country needs to live on. What’s more, the remedy imposed by reality on the government tears apart the coalition that put it there. So-called red wall voters who gave Boris Johnson a majority in 2019 did so in part because they were promised big money to draw level with the south, not so they could get a more emollient version of George Osborne’s austerity. Meanwhile, blue wall Conservatives, and especially the MPs who represent them, are Conservative because they believe, often as a matter of theology, in low taxes – yet it is their government that is taking more in tax than Stafford Cripps, Denis Healey or Gordon Brown ever dared. Most Tory MPs are prepared to stomach Hunt’s medicine for now, but only because they craved calm after the turmoil of Truss. Their patience will not hold for long, which means Rishi Sunak will soon be dealing with a restless parliamentary party that lost the knack for discipline long ago. Put all that together, and you get the expectation most Tories themselves admit privately: that these are the end of days. The best they can do is hope that something comes along – that inflation falls, interest rates ease, growth returns – and voters give them one last chance. But few are betting on it. On the contrary, most are bracing for a Labour government. And yet, grim as the outlook is for the Tories, Labour’s path to victory is not as straight as it may first appear. And that’s because Labour faces a different opponent to the one that confronted it even a few weeks ago. To be sure, Labour is comfortably ahead in the polls. But that lead grew in response to the two previous iterations of this government. First, voters became disgusted by the scandal, dishonesty and hypocrisy of the Johnson administration, and especially of Johnson himself: his failure to comply with his own Covid rules broke the bond of trust voters placed in him in 2019. Next, voters recoiled from the florid incompetence of Truss, which shattered the Tory reputation for economic acumen so thoroughly and so fast that, as I discovered for myself earlier this month, even US politicians and pundits now casually use “Liz Truss” as a synonym for debacle. The Hunt-Sunak combination is a different proposition. Sunak may yet rue his pledge to restore “integrity, professionalism and accountability” to government – thereby setting a standard by which to judge, and condemn, every ministerial failing and poor appointment – but for now, few voters would put him in the same moral category as Johnson. Similarly, he and, especially, Hunt are effective at presenting as steady technocrats rather than the crazed-eyed ideologues each replaced. Truss and Kwarteng were such an easy target. With their tax cuts for the richest, they were pantomime villains, all but inviting the audience to boo and hiss. The new duo are cannier than that. Not only have they not abolished the top rate of income tax, they’ve brought more high earners into it. They’ll uprate benefits and pensions in line with inflation, raise the minimum wage, give more cash to schools and hospitals and extend the energy price guarantee for those who need it most. Naturally, there are sleights of hand: non-doms are safe; the energy giants should have faced a heftier windfall tax; local councils will be forced to wield the axe on services already shrunk by Osborne’s austerity a decade ago. But Sunak and Hunt have made sure the optics are different – two decent men doing their best to clean up a mess, anxious to look out for people and services in need. The announcement that a couple of New Labour-era bigwigs will be at their side, offering advice, completes the picture. That makes it tougher for Keir Starmer. He likes to be the adult in the room, but come 2024 he will not have sole claim to that role. He will be asked if Labour will stick to the spending cuts that, cunningly, Hunt has scheduled for the other side of the next election. If Starmer and shadow chancellor Rachel Reeves won’t adhere to Tory spending plans, as Tony Blair and Gordon Brown promised in 1997, what other cuts will they make? Given their plans for billions in green investment, how will they make their sums add up? Labour is always held more tightly to account on spending than the Tories – unjust, but true. For now, Labour says it cannot possibly know what state the finances will be in come 2024. That position may hold for a while, but not for ever. All this is made harder by Labour’s refusal to speak of the great unmentionable, the giant, stomping elephant marked Brexit which, the governor of the Bank of England confirmed this week, is one big reason why the British economy is contracting while the eurozone and the US are growing. Public support for quitting the EU is at an all-time low, with even one in five leave voters now conceding it was a mistake. It is the biggest single error of the post-2010 period, if not the postwar era, and yet the opposition can barely utter the word, let alone demand the government answer for it. So yes, the gloom descending on Britain is now so thick that the simple logic of “time for a change” should see the Conservatives beaten in 2024. This week the economics of that became simpler and starker – but the politics just got trickier. Jonathan Freedland is a Guardian columnist