Labour has lost the battle – but it could still win the war

By Joe Coward

There are two clear outcomes of the 2010 General Election. Firstly, after 13 years of Labour government the electorate has demanded change. Secondly, this desire for change does not represent a strong desire for majority-Conservative government.

In government Labour has demonstrated that in an age of globalisation the choice between a competitive, open economy and a commitment to fairness and social justice is a false dichotomy: we can have both. Introducing a minimum wage, achieving strong improvement in secondary school results, and achieving shortest NHS waiting times since records began are achievements of which Labour can be proud.

However, it is undeniable that Labour has been gradually losing support over its 13 year in power: only 29% of the electorate wanted a fourth term Labour government. The most damning failure of Labour in government is the country’s spiralling budget deficit, currently running at 12%, which is even higher than that of Greece. Essentially Labour has tried to create a Scandinavian-style welfare-state on the basis of US-level taxation. This was foolish, unsustainable and irresponsible. Moreover Labour has lost significant support amongst the liberal-left due to the war in Iraq, its commitment to compulsory ID cards and an alleged disregard for civil liberties. Thus, whilst on balance Labour can be proud of its record, it can have no complaints that the electorate wants change.

The Conservative Party has received the largest number of seats and the largest share of the vote, and a stronger endorsement from the electorate than Labour. In theory, the opposition party would have been expected to win this election, easily achieving a working-majority in the House of Commons. Against the backdrop of the most severe economic crisis in living memory and the expenses-scandal, the Conservatives faced an incumbent government which had been in power for 13 years, and whose leader is widely viewed as an electoral liability. Indeed, between spring 2008 and autumn 2009, the Conservatives consistently had a double-digit poll lead over Labour and were widely predicted to sweep to power. Yet, since late 2009 the anti-Tory vote has been steadily increasing, with Labour ultimately the prime beneficiary.

The muted-endorsement of the Conservative Party can be explained by two competing dynamics in the political cycle. The economic and political crises have created a strong appetite both for change, and for progressive government. There is undoubtedly a strong desire to punish the incumbent government, but there has been no rightwards shift in public opinion. Widespread anger at tax avoidance by the rich, the dominance of the British economy by financial capital, and MPs seen to be living in a world apart from their constituents might all explain a desire for a progressive government.

This first-past-the-post system is designed to produce strong government in a parliament composed of two parties. It does not work when an election is closely contested between three major parties. A system which gives the Liberal Democrats 8% of seats on a 23% share of the vote is broken. If the British electorate continues to vote for three major parties, the electoral system will have to change. This would represent a massive culture-change in British politics, creating a political culture far closer to that of continental Europe.

Whether the British people would ultimately endorse European-style pluralism over majoritarianism remains to be seen. A consequence of the British political system is that for most of the twentieth and twenty-first centuries, the progressive vote has been split between two parties. Whilst Labour and the Liberals/Liberal Democrats do have ideological differences, Democratic Socialism, Social Democracy and Liberalism all share a principled commitment to the positive role which can be played by government in a market economy. Both Labour and the Lib Dems are prepared to use the power of the state to promote economic growth, regulate the economy and redistribute resources from the richest to the poorest in society. The Conservatives’ ideological hostility towards increasing the remit of the state means that they can never be a progressive party.

Hence, Labour and the Lib Dems have much common ground. Indeed, the cleavages within Labour between Compass and Progress and within the Lib Dems between the Beveridge Group and Orange Book MPs are larger than the aggregate differences between Labour and the Lib Dems. The commonality between the two parties has been demonstrated by successful Lab-Lib coalitions in the devolved governments of Scotland and Wales. Thus, all things being equal, Liberal Democrat MPs and activists would almost certainly prefer an alliance with Labour than the Tories.

In the real world of course, all things are not equal: the Conservatives have a plurality of votes and the Lib Dems have a duty to listen to the offer made by the largest party. The deathbed conversion of Labour tribalists to the cause of proportional representation is not solely a desperate bid to stay in power; it is also smart party-tactics. The Liberal Democrat leadership is now placed in a very awkward position, accountable to its membership, and stuck between a Conservative Party with a stronger mandate, and a Labour Party with a sweeter offer.

Whichever party Nick Clegg chooses to support, the Lib Dems will suffer. If he supports a Labour government which has lost its mandate, his promise of a “new politics” will be discredited, with the Tories presenting themselves as the only alternative to Labour. If he spurns the once-in-a-lifetime offer of electoral reform, supporting a Conservative government committed to immediate swingeing public sector cuts, he will anger many of his progressive voters, activists and MPs.

But whoever the Lib Dems choose to support, the outlook for Labour is relatively rosy. If Labour is kept in power by the Lib Dems and smaller parties, the progressive coalition would introduce a proportional voting system with an instinctively anti-Tory majority: Britons voted 3:2 for progressive alternatives to Conservative rule.

Alternatively, if the Lib Dems support a Conservative government, the poisoned-chalice of power could destroy the third party. Their strongest asset, Vince Cable (a former Labour councillor) would be hamstrung by a commitment to support George Osborne’s budget (note that Cable has not been involved in discussions with the Tories). Labour, most likely with a new leader, would reap the benefits of being the only opposition to Dave, George and Nick’s unpopular cuts, the party being bolstered by a steady stream of defecting Lib Dem voters, activists and, potentially, MPs.

Whilst Labour has lost the election, its long-term position as the major progressive force in British politics is secure. Therefore, whoever Nick Clegg chooses to support, Labour will ultimately benefit.