Iain Macwhirter: Tory leadership contenders are playing a game of liar's poker with public money

And they were just getting started.

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Hunt raised the stakes by promising to keep TV licences free for over 75s, increase defence spending by £15bn, back HS2, and give all young people the “right to own a home”. Realising he had a fight on his hands, Johnson threw in a pay rise for public sector workers; 20,000 new police; full-fibre broadband for every home and £5000 minimum spend on every English secondary school student.

By this stage, the contenders had become like poor souls in Las Vegas, at 6am on the third day, trying to make up their losses by going all in. Both made uncosted pledges on social care. An addled Jeremy Hunt said he would cut student debt and write off tuition fees for young entrepreneurs.

The Barnett Formula, you ask? Boris Johnson may have railed against the Scottish spending calculus as “unfair”, and “inequitable” – a tax on being English. But both he and Jeremy Hunt now praise the much-maligned formula as the essential glue of the Union, and have promised never to touch it. Indeed both candidates threw in £6bn for post-Brexit agriculture and fisheries.

By now, the adults in the Tory poker room were beginning to fret. Spoilsport Chancellor Philip Hammond warned that they'd spent his “£27bn fiscal headroom” many times over. The Institute for Fiscal Studies went further and accused them of “misleading votes” by making spending pledges that could never be met, while cutting taxes for just about everyone. The IFS Director, Paul Johnson, pointed out that the £27bn was available for one year only.

And Brexit? Well, Jeremy Hunt's response to the Chancellor's strictures was to toss in another £6bn to compensate industries hit by Brexit tariffs The IFS believe the cost of Brexit will be vastly greater than that. Yesterday, Philip Hammond said that a No Deal Brexit would cost £90bn. But this is now fantasy land and no one is really listening any more.

Now, you might just regard this all as pork-barrel politics as usual. Don't politicians always over-promise, throw money at the voters, spend as if there's no tomorrow? Well, no actually they don’t – especially not Conservatives. You don't have to go back to the fiscally dry-as-dust Thatcher era to hear the mantra: “only spend what we can afford”. The former Labour Chancellor, Gordon Brown, worshipped a god called “prudence” in the 1990s, believing that Labour had lost successive elections because it couldn't be trusted with the purse strings of government.

In 2010 the Tories formed a government with the Liberal Democrats, which pledged to restore the nation's finances by the most radical cost-cutting. It was called “austerity". George Osborne's' programme was compared to the “Geddes Axe” – the eye-watering spending cuts imposed by the coalition Chancellor, Sir Eric Geddes, in 1922.

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It's worth reminding Jo Swinson, as she bids to be the next LibDem leader, that the Liberal Democrats endorsed Osborne's austerity. Indeed, Vince Cable, still says that austerity was “necessary".

No one else seems to be saying that. There has been a seismic shift in the politics of public finance as politicians have suddenly abandoned the old language of fiscal rectitude. And not just in Britain. President Macron of France has had to reverse his public finance reforms. Donald Trump, despite all his rhetoric, has just put forward a record $4.7 trillion budget.

What seems to have happened is that politicians of left and right, but most strikingly of the right, have become influenced by the rise of the populists. Populism is often wrongly regarded as a traditional conservative ideology boosted by anti-immigration nativism. This is a mistake. As The Guardian and YouGov's six-month study of the phenomenon pointed out, populists are much more left than conventional right, and generally seek to reduce inequality.

“This is not something we expected to see”, said Kirk Hawkins of The Guardian. “Populism, in the end, is attractive because it takes seriously the grievances of people who feel abandoned and unfairly treated”. In the crucible of Brexit, the traditional party of the right has realised that it must do something to address these grievances, or cease to exist as a political force.

I'm not suggesting that populists are the New Left. Only a fool would believe the promises being made on public spending. Donald Trump's spending splurge has largely been on defence and building a border wall. But the change in the ideological agenda is too striking to ignore.

Jeremy Corbyn's 2017 Labour Manifesto emerges, in retrospect, as relatively modest in its spending proposals. The SNP under Nicola Sturgeon is also beginning to look a little, er, conservative in its approach to public finances.

As the former SNP MP George Kerevan pointed out, the SNP's Sustainable Growth Commission report, with its plans to hold spending to 1% below GDP, has many similarities with the austerity programme of George Osborne after 2010. At the very least, the SGC represents a covenant with the Scottish electorate that an independent Scottish Government would only spend within its means and would not indulge in radical deficit financing.

Tell that to the Tories! They've discovered the magic money tree. They seem to be adopting the left wing economics of Modern Monetary Theory, which says that public spending deficits don't matter because governments can always print money.

Of course, this is all in the context of Brexit. We are in an age of febrile politics. There will be a reckoning. When it's over, and the tide goes out, we'll soon see, as Warren Buffet likes to put it, who's been bathing without their costume on.