7 April, 2012 6 Comments
The Coalition Government is not going to spend the £100bn in a Keynesian move to boost demand and lift the economy out of its current state. No matter how much some shout about it that is simply not going to happen.
The Government is not going to move away from its message of fiscal responsibility and consolidation. Politically, the public agree with them that it is right that the state contracts; they also agree with us in Labour that the cuts are causing unnecessary pain.
The argument for Labour must therefore centre on where and how we would cut, rather than whether we should at all. This also presents a challenge for the Labour Right: How do we respond to our new situation?
An acknowledgment that we did not spend every taxpayer’s pound well when we were in Government would be a good start. It does not mean that we are “surrendering” to the Tories – We are not. We are giving ourselves a chance to win the argument that we must win to return to Government in 2015.
The instincts of the post Crosland reforming tendency in the Labour Party have, pretty much, stayed consistent for the 56 years since the publication of The Future of Socialism. It has been to redistribute the fruits of growth in the economy, not by increasing taxes but by using the power vested in the state to encourage economic expansion. It has also included a recognition that ends are more important than means.
Equally, that is not going to happen. There is little appetite in any of the major parties for the huge stimulus that would be required to drive growth from the centre in the UK economy. If a recovery does come it will not be fuelled by more Government spending.
The recovery will be driven by exports to economies in the ‘New World’ that are rapidly expanding: Brazil, Russia, India and China. This week we have seen the good news that the new Jaguar ‘E’ Type will be built at Jaguar/Land Rover’s Castle Bromwich site in the West Midlands. Land Rover (Now owned by the Indian car giant TATA) continues to invest in its Solihull site. One in six Land Rovers, Range Rovers and Jaguars built last year were shipped to China, where sales grew to 42,000, an increase of more than 60% in a year.
All rather a roundabout way of saying that if a recovery does come before the next election (and there are a few signs that there will be a recovery) then it will not be George Osborne who has made that happen. If he is remembered as a Chancellor it will be as a man who was said to be the greatest political strategist since Machiavelli who turned out to be rather, erm, lacking. If the Tories don’t get an overall majority at the next election they will have failed to win elections for the past 23 years. The blame will rightly be placed on George Osborne after a politically disastrous budget.
That leaves a challenge for the Labour generally and for the Labour Right. Whilst we are in opposition we have an opportunity to undergo intellectual self renewal. A number of important debates need to be had: Why did we fail? Why have we lost people’s trust? How can we regain that trust? How can we win again? How will we use our time when we are next in Government?
The Crosland ‘revisionist tendency’ can be useful to Labour here. We should also be asking how a crisis of 1980s neo liberalism has resulted in a lost of trust and belief in the State. The answer to that, probably, can be seen in the experience of incumbent Governments across Europe – They lost because they were in Government. The Left suffered worst because we have traditionally been advocates of sheltering the most vulnerable from the worst excesses of the market, and failed.
New Labour was so successful because it did away with the shackles that had been placed on us by the Left of the Party. Means were no longer as important as ends. The ends stayed the same, the means changed. Undertaking a revisionist experience of our time in Government as New Labour cannot cease now – We must acknowledge that there were areas where New Labour failed and we must reassess in that context. 1994 era New Labour is as irrelevant to the modern Labour Party as the experience of Labour under Michael Foot in the 1980s.
Social democrats and centrists need to reevaluate the means that we use if we are to achieve the dual ends of economic prosperity and social justice. Again, the ‘revisionist tendency’ can be useful. There will be little or no new money for Labour to borrow or spend. The challenge must therefore be how we can achieve more with Government spending to advance Labour’s values.
This week I attended a discussion with Hopi Sen, the Labour Blogger, and he suggested a change in our thinking. This involves a change in what we mean by ‘universality’, and a recognition that universal benefits are no longer appropriate. We must, instead, move towards a universality which centers on common experiences rather than on a ‘everybody receives the same’ ideal.
For example, Hopi suggested the scrapping of universal child benefit for higher rate tax payers and replacing it with free childcare for under 5 year olds. An example of something that would cost nothing, but would simply redistribute money towards a common experience – Labour values in action at a time of fiscal austerity.
After this discussion I went away and had a look at my membership card. If you look at the back of a Labour Party membership card (I get sent a new one every year: please stop doing that!) it says this:
“The Labour Party….believes that by the strength of our common endeavor we achieve more than we achieve alone, so as to create for each of us the means to realize our true potential and for all of us as a community in which power, wealth and opportunity are placed in the hands of the many no the few, where the rights we enjoy reflect the duties that we owe, and where we live together freely, in a spirit of solidarity, tolerance and respect”.
Soft financial redistribution is not the only value of the Labour Party. We also pledge ourselves to putting power back into the hands of the people. I see that in two ways: Making Government more accountable and giving people choice in and control over the services that they receive from the State. It means giving people the opportunity to participate in devolved democracy, have political parties which are not in hoc to vested interests and have power taken away from central government and given to local government that is accountable. It also means putting public services in the hands of the people that use those services: the ability to visit any GP that you want to see, to have access to social care provision which befits years spent paying National Insurance and devolving power in the NHS – that would have prevented the Government from making it’s last top down reorganisation.
It also means giving victims of crime rights, giving them the chance to see the progress of their investigation through a single, centralised system and allowing the police to respond to anti social behaviour that can be so destructive to individual lives and communities.
Another value that stands out to me there is that the rights that we enjoy must reflect the duties that we owe. That means making work pay, giving people the opportunity to find a job that is suitable to them, but then imposing a penalty if they fail to take that job. Putting this value into practice means having a sensible and rational conversation about immigration; not just talking about the positives, but also recognising and the effect that it has on communities.
It also means tackling the issue of disconnected individuals who feel that society owes them nothing and that therefore owe nothing to society. Tackling this problem, in the shadow of last years riots in the UK’s cities will be crucial in rebuilding communities which appear to becoming more fragmented and disjointed. Lessons here can also be learnt for Labour here in reengaging with communities after out shock defeat in Bradford West.
This all means that we cannot repackage old thinking and reasoning and present that to the public in the political equivalent of an under heated Asda Basic’s ready meal.
We must be truthful with the public that in choosing Labour it will not be a couple of years of pain followed by years of growth and government spending. If there was a Labour Government now times would be hard. If we win the next election they will be hard, but we should (and will) say how we will make life that bit easier for ordinary man and woman.
The challenge for the Labour Right is that we must have these debates. We may not win them. In fact, we may well end up losing many of them. Having time in opposition to discuss and debate policy openly is on of the small benefits of being in opposition.
There are not many of these opportunities, so we should take advantage of them whilst we can.
The Labour Right must make its voice heard.