Labour’s strategy may be about to be tested to breaking point

20th February, 2012 11:07 am

They are so fragile and young, we can’t even call them green shoots. The recent indications of some pick-up in the economy might better be described as a germinating seed struggling in a soil weak on nutrition and beset by pests.  But there is a glimmer of hope.  It could all be dashed by Eurozone collapse or an escalation in the Middle East but if we escape those horrors then it seems confidence may gradually begin to return, maybe with some buoyancy, as the year progresses.

This is, of course, bad news for an opposition party.  Without a major negative shift in economic circumstances, it is rare for voters to think again about how they voted last time. Most changes of government since 1945 have been preceded by an economic crisis of some sort.

But economic recovery, even a modest one, will prove particularly damaging for Labour.  This is because the Party has hung its appeal to voters on the claim that the Government’s austerity plans are preventing recovery. The only part of Labour’s message that seems to have cut through is the slogan ‘too far, too fast’.  But if the economy begins to grow again with any degree of vibrancy, the Government will say that far from cutting ‘too far, too fast’, their plans have been ‘just right’. In short, Labour will have been proved wrong.  So the conclusion that voters came to in 2010 that Labour could not be trusted with the economy will have been reinforced rather than challenged.

There is plenty of opportunity to dance around this conclusion.  Some will say that Labour is not arguing that the economy will never recover just that growth will be less robust than it might otherwise had been. They may also argue that Labour’s message is fundamentally about the best way to get the deficit down not the wider economy. But none of this matters.  Electoral politics is painted in bold colours and crude shapes.  Few will look at the detail and nuance.  The message will go out that ‘borrow-and-spend Labour’ opposed cuts because it would prevent growth and they got it utterly wrong.

All of this will have been utterly predictable.  The cuts, while painful and deep, only represent one particular economic headwind.  Low investment, low productivity, low earnings and high inflation are the others.  Positive changes in these could well get the economy chugging along again.  To suggest that austerity is the only or the main blockage to growth is wrong.

However, even if growth remains elusive, it is unlikely to benefit the Party.  The majority of voters clearly made up their mind in May 2010 that Labour could not be trusted with the public finances or the wider economy. Nothing has been said by the Party, in a sustained fashion, since then to persuade voters that Labour has changed. The welcome but limited impact that was made in January on Labour’s approach to the deficit has dissipated as the ‘too far, too fast’ message immediately returned as the leading mantra. So even if the economy remains sluggish, voters have not been given any serious reason to listen to Labour’s explanations or solutions.

Improving economy or flat-lining economy – Labour isn’t yet in the game either way.

Adam Lent is co-author of In The Black Labour and was formerly Head of Economics at the TUC. He can be followed on Twitter @adamjlent

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  • Given how persuasive and well-argued “In the Black Labour” was, I’d expect something more substantial than this from you, Adam.

    This exact same article could have been written about any period of Labour opposition since the war. It’s the same argument, again and again, ad nauseum: “if the economy recovers, we’re screwed.”

    In this case, however, you added the uplifting coda of “if the economy doens’t recover, we’re still screwed.” So, really, you could’ve just written “we’re screwed” and saved a few bytes of LabourList’s server space.

    I found this bit particularly strange:

    “The cuts, while painful and deep, only represent one particular
    economic headwind.  Low investment, low productivity, low earnings and
    high inflation are the others”

    Do you seriously think that the latter problems are not linked to the former, and to broader government (in)actions?

    • The link is not as direct and tangible as you might think, as at any downpoint in any economic cycle (of which the current one is worse than most, of course) you see the combined impact of many (hundreds of) thousands of individual CEO’s and Group Treasurer’s viewpoints.  A government can help “adjust” their views, of course, and provide some economic encouragements to spend money – but the effect is limited by the available “war chest” and the message Tories have most successfully put into the public mindset is that “there was no money left” when they took over, and hence that any issues are, in some or all part, the fault of the previous administration.

      Whether this is fair or not is irrelevant: the bottom line is Labour have yet to cement a clean break with the negative aspects of their own recent past, which means changing more of the faces and producing a clearer message, I believe.

      Whether this is accepted by the PLP is unclear, but more apparent is the paralysis of the party leadership in facing up to the choice of whether to adopt an electorally safer but strategically less definable “new start” along a New Labour-like line espoused by a number on this site, myself included, or the more risky approach favoured by, in fairness, a fairly high percentage of grass roots supporters, and many on this site such as Mike H, derek and others of a “new socialism” where the distinction is enormous and clear.  Following a line which is neither one nor the other is clearly unsatisfactory for all involved, and this article is right to point out that the current economic window may be closing if we wish to take advantage of it.

      • Jeremy_Preece

         I would be along the lines that you suggest David, that of “a new start along the lines of new labour” seems the best. Clearly the new Socialism is more distinct but needs to be defined clearly. Either one is better than the muddle we have at present.
        What I disagree with is the criticim of Labour’s economic record is fair or not is irrelevant. It is actaully the nub of the argument. It is not fair, and so perhaps we should start by asking how therefore Cameron could find the money to appoint new unelected peers, and further the cost of redefining the electoral boundaries to loose about 50 elected MPs. All of this cost and was carried out in the name of saving money. So many of the cuts actually cost. So the argument that there was no money cannot be true. What is wrong is that Labour has not been challenging this. 

        • AlanGiles

          I always despair when I see people advocating a return, a refurbishment or a repaint of “New Labour” – it is as sad and pathetic as those crusty old Tories who still wanted Mrs Thatcher back in 2000.

          In 1997 Labour picked up a lot of votes from disaffected Tories because it was quite clear – despite his constant wittering on about being “radical” Blair was a right-wing leader who was the next best thing for Tories who were embarrassed by the shennanigans of the past few years. Thanks to stuffing his cabinet with right-wing reactionaries like Blunkett Straw and Reid, a lot of Tories were able to hold their nose and vote for Blair again in 2001.

          But 2012 and 2015 is not and will not be 1997 again. The Tories have a leader who while they might not love him, will probably do just enough to keep the Major and his lady happy to vote for him again – all shortcomings will be written off as due to Clegg.

          For Labour to want to revisit the past now would be seen as a panic measure. Blair isn’t available and David Miliband is so bumptious  and remote not only would he not get Tory votes he would probably lose more than Ed would

          • But do you think the country is more, less, or about the same in its left-right split?  We are both blessed and cursed with a fairly high degree of “swing” votes here in the UK, but I suggest these typically congregate around a fairly consistent and recognisable “centre”, even over the last 30 years, which is where we need to appeal to voters if we want to attain power.

            There is the separate debate of course about whether we would prefer the Labour party to “reign in hell” or “serve in heaven”, but on that point I have both a preference for the politics that the area represents as well as a pragmatic viewpoint that diluted power is better than no power if you want to actually help people.

          • AlanGiles

            Problem is David, Blair wasn’t in the centre – he was most definately right-wing. Had he had a more diverse cabinet it’s possible that it could have drifted back to the centre, but Blair the autocrat made sure he had like-minded men and women, plus a sprinkling of totally inexperienced sycophants who couldn’t and would’nt  dare stand up for their principles.

            Dave Stone and myself have both quoted what Owen Jones said last week. When he asked Hazel Blears why more had not been done about social housing (and they had 2 landslides remember), Blears replied that nobody in the New Labour government WERE INTERESTED ENOUGH in housing. That is a shocking state of affairs, totally unforgiveable.

            If you are being offered a real Conservative government or a “Labour” Conservative government, it isn’t much of a choice.

            Blair’s “Labour” government wasn’t just diluted Labour – it was as weak as “flavoured” water.

          • Jeremy_Preece

             Actually Alan, what depressed me was when Ed Milliband was elected as the new leader, and Niel Kinnock and some of the union leaders began an all night party saying that they had got their party back. Yes back from New Labour and safely away from the electorate.
            So what is your solution then, scrap New Labour and go back to the good old days of the 1970’s and prehaps the 1980’s with an unelectable party and an unopposed Tory regime free to do whatever it likes for the next four terms.

          • AlanGiles

            Jeremy: I said quite clearly that the way forwards is not to go backwards – and that includes the 1980s just as much as the 19902.

            Blair turned the Labour party into a version of the Conservative Party for his own ends. For a time he got away with it –  but the signs were there in 2005 that the public had had enough of it and him.

            Labour party membership fell dramatically during his years as leader, and now the public see the real cost of PFI and how what Blair and Brown started with Welfare and the NHS has made it so much easier for the coalition to continue to decimate.

            If you want a Blair clone you have David “Let’s-take-on-Iraq and are’nt-I-a-clever-boy- mummy?” Miliband, but if you think he could win the 2015 election by trying to be Tony Blair, I think you must be in a world of your own.

            Every leader has his day and the days of Blair and that sort of showbiz and bullets government have long passed.

            The answer is to have policies you can believe in and sell to the public, not having a cheap plastic copy of yesterdays model

          • Jeremy_Preece

             No Alan. Tony Blair saw Labour increase its membership in the 1990’s but the wheels started to fall off because of the Iraq war, and the many voters felt that the principled party was the LibDems (remember them?) who remained anti-war throughout.

            The essence of New Labour was that it was pro business and not anti, but that it could use business to generate funds to finance the health service and help to provide a public sector that delivers the things that people care about. It was a vision of wealth tricking down to the majority.
            Was it perfect? No. But there were many achievements, cutting third world debt reducing unemployment for starters.

            In contrast the Tories simply use business to fuel inequality and concentrate wealth into the hands of the few. Tories want to privatise the NHS and generally destroy the public sector. They also want to see that the unemployed, the sick and all at the bottom of the pile get a good kicking as a punishment for being poor. (Or maybe they hate the growing number of unemployed for existing and showing how bad their economic policies are.)

            We would do well to recapture the main thrust of New Labour, with policies that would make it work again today.
            In contrast I see your scrapping of New Labour as saying that you want Old Labour, men in cloth caps drinking beer and eating sandwiches in smoke filled committe rooms plotting the nationalisation of everything that lives or moves.

            It is your description of David M that is from a world of its own. And even if we accepted your version of David M, it would still make him ten times better than his muddled, intraverted, confused and lack-luster brother who is managing to lead Labour into the margins.

          • AlanGiles

            With all due respect Jeremy you make absurd claims on my behalf which are not only untrue but stupid. (”
            In contrast I see your scrapping of New Labour as saying that you want Old Labour, men in cloth caps drinking beer and eating sandwiches in smoke filled committe rooms plotting the nationalisation of everything that lives or moves.”)

            For Christ’s sake, where have I suggested the wearing of cloth caps?. Get a grip man. I always feel that “Jeremy’s” who evoke the image of beer and cloth caps are showing their own snobbery rather than an understanding of real life.

            The fact “nobody” in Blair’s shower were “interested in housing” at a time of paucity of social housing (as recalled by Blears) shows you the true snobbish hoity-toity stance of these spoilt, Oxbridge educated people who have never worked in the real world, except as a barrister (the beter for getting away with expense scams) or in “the media”.

            Nobody is suggesting Labour should be anti-business (and I would hardly call Harold Wilson’s 1970s  National Enterprise Board an example of anti-business intent on his behalf – it helped keep afloat a lot of ailing businesses especially in the electronics and heavy industry – I happened to work for one of them, so I have to declare an interest here). By the way I have never worn headwear of any sort in my life and I don’t like beer. New Labour always reminded me of that remark Orwell made about how his class was bought up to believe the working class smelled.

            I agree about the Tories and people on welfare but guess who started the whole ESA broiling?. Who gave David Cameron David Freud?. Have you forgotten it was Labour?. In the dog days of Purnell we were hearing of terminally ill patients being denied benefits courtesy ATOS – one of Purnell’s favourite firms. From 1997 NL demonised the poor and the unemployed – firstly with that dreadful self-loathing old queen Frank Field, on through Darling, John Reid, Blunkett and Johnson who wanted to break doctor/patient confidentiality by stationing DWP staff in waiting rooms, to be tipped off by receptionists who was unemployed.

            As for health,  yes what is happening is disgraceful but do you remember Milburn  & Hewitt, b0th of whom were mini-Lansley’s in that they held jobs in the private sector with companies who wanted the NHS “opened up”, at the same time as being Health secretaries. Hewitt is now a N-E director of BUPA and Boots. 

            Let’s not pretend in your hagiography that New Labour was all sweetness and light who just wanted to do good and go to heaven. PFI will be a millstone around our necks for decades

            Whatever Ed Miliband’s failings are at least he didn’t fiddle his expenses. The same is not true of his brother. EM was not in Parliament at the time of Iraq. DM was an enthusiastic supporter and  remains so. He would welcome military action against Iran.

            If you ever succeed in getting the effette pseudo-Tory Blair party back in buisiness I hope and believe you will lose elections with it.  Why bother with a cheap copy when the public can have the real thing. I cannot believe anyone seriously thinks that the public have forgotten the sleaze  and hypcrisy of the Blair years

          • Jeremy_Preece

             Alan – the reference to cloth hats is figurative (i.e. not literal), but meaning outdated. I mean that Labour appears to be outdated. This is not snobbery, but a perception of the electorate, particularly the ones on whos door I knocked when I stood in the local election last May. I actually care very much if the party I stand for is not coming over properley to the electorate, and I regard the electorate as the real world, i.e. the people that we have to win over if we want to be elected.
            I am certainly not a snob. My grandparents were very ordinary people from the Forest of Dean, one  grandfather was a miner and the other worked in the local factory except for a period in the 1930’s when he was unemployed.
            By the same token I am also not an inverted snob, how about you Alan? 🙂

          • AlanGiles

            Whatever your motives Jeremy, you were indulging in the old Blairite trick of pretending that anyone and everyone who did/does not subscribe to the right-wing ethos of New Labour is a Ludddite. Mandelson used a similar trick back in 97 at Conference when he opposed a motion to make it easier for working class candidates to become prospective Labour candidates by saying “horny handed sons of toil are not needed”[by Labour]. Those blue-collar workers would probably have been more honest in filling in their mortgage applications, however.

            If you want to build a shrine to an outdated model for Labour, I daresay you will find some fellow travellers to enjoy a lengthy spell in opposition with, because the public will not want an old product they are tired of. I am not suggesting a return to the 1980s or 90s because it won’t work now. Blair and his cronies look raddled and irrelevant now

          • Jeremy_Preece

             My motives are to see Labour back in government and Labour running our local councils – end of.
            Therefore I want to see the current muddled, rudderless, leader – with no leadership skills, replaced now by some one with direction, vision and the drive to get a coherent message across to the electorate.

            I take from New Labour the idea that Labour is for all (maybe not the top 5%) but certainly the middle and lower end of the specrum. I also take from New Labour the notion that Lbaour must be realistic, and able to foster business as a driver to generate the wealth that is to trickle down.

            No shrines Alan – but a gravestone for the awful coalition and its policies 

          • AlanGiles

            Change the leader now and it will look EXACTLY what it would be – a panic measure.

            You will lose in 2015.

            Ndew Labourites are exactly the same as the Tories between 1997-2005 forever wanting their old leader back and constantly changingwhat they had to try to get it right.

            Who wouldyou like as leader?Banana Boy or Ms Cooper. Most frustrated old Blairites want one or the other

          • Jeremy_Preece

             Either of those or a number of others would be an improvement on Dead Ed.
            Ed is as likely to win the next election as Ian Duncan Smith is to become next Tory PM.
            There is no virtue in letting the party go down at the next election just to keep ED!

          • AlanGiles

            God, Jeremy, you sound desperate!: “Dead Ed”  – a bit sick isn’t it? – Hell hath no fury like a Blairite scorned!

            Get well soon.

          • Jeremy_Preece

            “Balirite” or any other label is always good to use if you
            want to insult someone without dealing with their argument. Desperate? – No,
            just frustrated. I suffer the frustrations of a loyal Labour member who wants
            Labour back in power, but sees a leader without leadership qualities who seems
            to bury himself rather than project a coherent position.

            Sorry about “Dead Ed”, I will worked harder to see if I can
            aspire to the intellectual wit of your “aren’t I a cleaver boy Mummy” and “the
            man with the banana” to describe David Milliband.


            I mean “Dead Ed” insofar as the leader who should be
            powerfully blasting his position to the nation and winning over voters, but who seems instead,
            to radiate a vacuum.

            I can’t be bothered to answer your “get well soon” remark

          • AlanGiles

            If you are a “Blairite” you shouldn’t be ashamedof it – and you clearly are.

            I can also see that you are very overwrought and upset because you can’t have Blair back. It is impotent rage, Jeremy and will get you nowhere. I begin to think of you as Shakespeare’s Richard ll “oh call back yesterday, bid time return”.

            Seriously, change your leader now and you will lose in 2015, because there wouldn’t be time for a ndew leader to establishhim/herself. It also looks rather undignified.

          • Jeremy_Preece

             Dear Alan. You speak as if Ed Milliband is going to win the next election. You and I both know that this will not happen. I am not overaught about Blaire new Labour or anything other than the plan of a number on this page that the best thing to do is to leave the current captain to sink the ship, then sit out the next few terms in office and hope that in 20 years time we may get another chance of power.

            I say again, that I am a loyal Labour member who will vote Labour and will work with their CLP, possibly stand again in the local and do their best even if the leader is not to their liking and even if there seems to be no clinical signs of life from the leader.

            I am not like some of the others on this page who say that they will wate their vote and sabotage the party if they get the leader that they don’t want.
            If wanting Labour to win back power makes be Blairite, or right wing or even likely to eat bananas in your eyes then that is your problem and not mine.

          • AlanGiles

            I didn’t say he would win, BUT three years is a long time in politics and things could go badly for the coalition. Learn the lesson of the Tories: they kept changingleader every couple of years, and it didn’t help them, because the public could see they were in a state of flux.

            If things go badly you have a chance in 2015 with EM. If you switch leader now I doubt there would be time. And you might not get D Miliband anyway. 

          • Jeremy_Preece

             We are agreed then that EM is not likely to win. I am saying that the Tories ditched IDS when he became a liability and their next leader did a bit better (although Howard was also dreadful).
            For what it is worth I also would not like to predict if DM could now win the leadership or if he would be seen as damaged goods.
            What I am saying is that EM is not projecting anything. We have reached a point where there is nothing to loose, and we might have a chance with a new leader.
            I can’t just think that maybe the Tories – who are where they are because enough people don’t like us, will somehow hate the Tories even more than us and therefore vote us in because it has all gone horribly wrong and they hate the Tories even more than Labour.
            A positive leader would however make a positive start on bringing us back,

          • AlanGiles

            But who is there, Jeremy?.

            I think the ;party hieracrchy would want to avoid another Milibandfamily spat, but who is there that could establishthemselves in less than three years.

            Remember a lot of the current crop are damagedeither through association with G Brown or their personaldishonesty in the expenses scandal.

            There woulod have to be another damaging and expensive election campaign, and remember, even though Michael Howard was given a coronation the public were not convinced by frequent leadership changes.I doubt that Labour would get any easier a ride – and it really looks desperate

          • AlanGiles

            Whatever your motives Jeremy, you were indulging in the old Blairite trick of pretending that anyone and everyone who did/does not subscribe to the right-wing ethos of New Labour is a Ludddite. Mandelson used a similar trick back in 97 at Conference when he opposed a motion to make it easier for working class candidates to become prospective Labour candidates by saying “horny handed sons of toil are not needed”[by Labour]. Those blue-collar workers would probably have been more honest in filling in their mortgage applications, however.

            If you want to build a shrine to an outdated model for Labour, I daresay you will find some fellow travellers to enjoy a lengthy spell in opposition with, because the public will not want an old product they are tired of. I am not suggesting a return to the 1980s or 90s because it won’t work now. Blair and his cronies look raddled and irrelevant now

          • treborc

            We will see at the next election, I suspect labour will change a great deal over the next few years, I suspect new labour will have a chance to try again, bit like the period when Thatcher lost.

          • AlanGiles

            I  doubt it. Comebacks rarely work out, and as the original is now seen taking money from wherever he can get it – even from despots, and his mini-me is following in Blair’s footsteps, setting himself up as a company to handle his business dealings, it will be a very real reminder of the self-interest and greed which New Labour fostered. Most of the big expense scandal MPs were Blairites – Blears, Darling etc etc.

            The smell will linger for years and however much David & Jeremy spray the air-freshner around, the underlying pong will endure

          • Jeremy_Preece

             And if Labour need air freshner, then the Tories need a full scale fumigation.

          • treborc

             Not if the deficit is cut and growth returns the people will give them the time they need.

        • I’m not sure those examples have a particularly high comparative cost, but if they do then I agree.  My point about whether the criticim of Labour’s economic record is fair or not having any relevance is more about the simple fact that, I believe at least, that we have already lost this argument in the minds of the public, and our energies are now better spent on moving forward, and dissociating ourselves with the characters who attract most blame, than on constantly reliving the debate.

          • Jeremy_Preece

             David. We cannot move on if we have allowed Labour to be stuck with a reputation that we are economically incompetant and caused the recession. This is a fatal flaw and must be dealt with. If we are seen as bad for the economy we are sunk.
            Other policies will then be only academic.

            In the 1980’s the Tories were seen as the nasty party who could be trusted with your money, while Labour were nice and fluffy, but ultimately a party that Britain could not afford. That was the public perception as created by the media.
            Tony Blair convinced the nation (as a result of John Major’s bad management) that actually Labour are better with the economy than the Tories, and Labour are also able to achieve socially good policies as well. The result of that was three terms in office.

            Today the parallel would be to get accross that the Tories will shrink the economy, and fail to pay off the deficit as a result and loose the UK’s AAA rating. And that do try to achive early deficit payment, they may cost you (Mr Ordinary Electorate), your job and your home.  To the business sector Labour should say that we are not really looking at letting you off your corporation tax, but we are looking at creating potentail customers for your businesses, who have money to spend.

            It is the truth, but is also essentail that we stop taking such a defeatist attitude to the economy.

      • Given that Labour achieved its greatest (recent) victory in 1997 (before the electorate had experience of a New Labour government) and the vote declined steadily thereafter, eventually losing nearly 5 million votes, how could a return to a New Labour-like new start be justified?

        • This is not the best place for this debate, but for what it’s worth my two responses are:

          1. It is comparatively rare in recent times for any government to secure larger shares of the popular vote over the course of their tenure.  The last example in the UK was, I believe, achieved by Thatcher, but many would argue that those circumstances were very specific.

          2. Given that no recognisably socialist party has achieved a majority government in the UK in at least the last 33 years, how could a return to socialism be justified?

          • AlanGiles

            Who do you think would be able to lead this New Labour revival? Who would have the credibility?. The man with the banana?. Or perhaps this dissembling idiot who left the note saying “There is no money left”?.

            Going backwards is not the way to go forwards.

            We already have three essentially identical parties, carry on like that and  most of this next couple of decades will be a story of hung parliaments.

          • Neither of those two would have my vote, though I believe that David M is more “presentable” than Ed M to most voters, for what it’s worth.

            As I say below, I believe we need to dissociate with all of the major players of the previous administration: they are all tarnished.  If that means replacing incumbents with fresh talent, then that is what we must do, and sitting MPs should (but obviously won’t) make way for younger blood for the good of the party.

            The argument about which path Labour takes can actually be an entirely separate debate.

          • AlanGiles

            Personally David I would want to know what I was signing on for, before getting my pen out.

            David Miliband’s geekspeak and “superior” manner would be a vote loser, I’m convinced of that.

            I cannot see the electorate at large, not even the most mallable Labour supporter, would accept a member of a brand new intake as the leader of a “new” New Labour.

            I honestly cannot think of a solitary candidate – and of course the coalition would have a field day castigating the new leader for lack of experience.

            I suppose we could always get Lord Mandelson a blue rinse and rename him Thatcher-Blair, then he would appeal to the old Tory voters and the 1997 nostalgic Labour Tories.. The plummy voice a la’ Thatcher and the simpering self importance of Blair – what a combination! 🙂

          • derek

            John McDonnell, now there’s a name that could lead.

          • treborc

              yes he deserves to be on the front bench anyway, but he is socialist so does not meet the new labour ideals which are riddled through the party

          • I’m not proposing a return to anything – not a 1997 re-enactment society nor the Old Labour equivalent.

            I’m firmly in favour of new thinking following the the collapse of the neo-liberal settlement. But unless it’s going on in secret then, as yet, I’ve seen no sign of new thinking in the P.L.P. And in the meantime opportunities are missed.

            Here’s a little coincidental example. Last night I listened to a discussion on the radio re the fashion industry. A Tory, Lib Dem and Labour MP were present. The discussion turned the advantages of fair-trade marketing partnerships. The Labour MP could manage only a few cautious words about the sustainable production of fabrics while the Tory confidently held forth about the non-exploitative wages and decent working conditions that are associated with fairtrade. It the perfect opportunity for Labour to bang home a message about social justice but it wasn’t taken. Why not? Perhaps because the MP feared she might then be accused of anti-business rhetoric? Who knows? Not me.

      • robertcp

        David, people like you do not seem to realise that returning to New Labour would be a risk, because people like me would not vote for it.  I will happily waste my vote rather than vote for Blair Mark 2.

        The second group are arguing for a new social democracy rather than a new socialism.  Incidentally, I was on the right of the Labour Party in the 1980s.

        Regarding Adam’s article, if the Coalition reduces the deficit and the economy grows at about 2% for the next couple of years it will deserve to win in 2015.

  • Johndclare

    What a disappointing, negative article, lacking hope or strategy.
    It starts off by appearing to imply that Labour should WELCOME economic depression because it might get them back into power.  I am sorry, but what a cynical anathema-of-an-idea that is.  I am sure that the students who are paying increased fees, public sector workers who are seeing their pensions lacerated, disabled people seeing their benefits cut and the growing number of unemployed will be disappointed to feel that, whilst they are suffering, the Labour Party might be dispassionately welcoming their plight as an opportunity to get back into power.
    … Not in my name, and all that!

    The article then goes on to suggest that, if the economy recovers, Labour’s economic policy will be discredited and we will lose the election … but that even if it does not, he says, Labour’s economic strategy is discredited and will not win us the election.
    … So ‘damned if we do, damned if we don’t’.
    A recipe for despair!

    Adam Lent clearly does not spend much of his life knocking doors.
    If he did, he would realise that those out there who are likely to support us want us to OPPOSE this government.
    At the moment ‘it’s hurting but it’s not working’ sums up how people feel and what they want us to say.
    If the economy begins to get going, it will be easy enough to change it to ‘it may be working, but why are we still hurting’.
    What Mr Lent needs to realise is that it is the ‘hurting’ bit that we need to oppose, which we need to get into power to reverse, and which will get us the votes.

    An article which merely says ‘it’s all hopeless’ – and implies that we need to throw in our lot with the Conservatives – is NOT edifying.

    • Jeremy_Preece

       Yes John. People really want to see a powerful party opposing this government, and now that the LibDems have signed up to this government, the way is open for Labour to walk in there and take the lead.
      However weak leadership prevents a strong direction being communicated. This government is very weak and Cameron’s approval rating is rock bottom – usually about -25.
      So there is really no great rock solid support for the government and there are a lot disaffected votors out there who would be ready to vote Labour if we could comminicate a clear direction.

    • GuyM

      If you run up a massive deficit and have to cut back (even dear old Ed Balls admits the need to “cut”) then it is going to hurt, whether you like it or not.

      The idea that we can trim back all the largesse of the Blair/Brown years and only a few indistinct “rich bankers” can carry the load is the sort of inane Labour party economic policy that this article criticises.

      There are not enough “rich” people to go around.

      So who are going to get some pain? Take you pick:

      1 Those on benefits (some the wrong benefits) including the long term unemployed
      2 Those on low wages i.e. £10k to £20k
      3 Those on median wages i.e. £20k to £35k
      4 Those on medium professional wages i.e. £35k to £50k
      5 Those on high or “good” wages i.e. £50k to £80k
      6 Those on executive salaries i.e. £80k to £150k
      7 The “rich” i.e £150k plus and private incomes

      In order to rebalance the national finances exactly which group are you going to make hurt?

      Just the top group? Already a 52% income tax rate, but maybe you can raise capital gains…. but that will have other nasty effects and there aren’t enough rich to go around.

      Maybe the £50k to £150k groups, but they are feeling the pinch already and again there aren’t enough to go around.

      Every group a little bit? But then everyone complains and we get diatribes about the “squeezed middle” and the poor and sick.

      Labour bequeathed the financial situation and whether you argue it was Labour’s fault or not, we are where we are. It really is about bloody time the left got real and decided what pain it is willing to accept and what it isn’t, rather than the aimless drift of a “clean sheet of paper” the two Eds seem to be stuck on.

  • Jeremy_Preece

    Perhaps we began by facing down the Tory myth that Labour has no economic credibility because “the reacession is al Labour’s fault”. While it clearly was a world wide recession and a collapse started by the morgauge crisis in the USA, and spread throughout the world, we have allowed the Tories to get away with “Labour’s recession”. Worse, we allow Labour ro take the blame for the what Cameron now claims is wreckless spending, but that he and Osbourn in opposition, said that the Tories would match.

    Labour has a real chance of projecting to the pubilic that the cuts are too deep and too fast and risk the UK loosing its AAA rating. Therefore the Tories are a party not of economic competance, but of stagnation, lack of growth and one that faces a possible own goal of loosing AAA rating.

    Under Tony Blair Labour had the reputation of being better with the economy than that Tories, and that is the reputation that we should win back. It might not be the exact same policies, but the overall posisiton of credibility would do it. Yes the eceonomy matters most.

    Blaire also managed to combine economic credibility with fairness for the middle and lower ends of the spectrum. Managing this without loosing economic credibility is what delivers a winning strategy.

    What would lift us up would be some leadership.  We need some clear direction and to communicate to the electorate our stretegy. I suspect that we do have a strategy so a leader who could project this would be our next step.

    • treborc

      But it did go wrong under labour and to even suggest labour did not have any cause in this is ridiculas the waste of money from the Brown  idea, 12 to 18 billion wasted on the NHS IT, wasted money into the hundreds of millions for ID cards, the wasted money on his other great ideas on IT, so come on labour lost billions on two wars which have not left the countries better.

      labour allowed the banks to go forth and  lose money and they still are, so to say New labour as you love so much would now do better, is simple wrong

      • Jeremy_Preece

         Hang on a minute treborc, lets use our brains a moment and step away from what the media and the Tories are saying.
        Fact 1, This was a world-wide crisis that started in the USA and no one in any government in the world saw the banking crisis coming.All were caught out.
        Fact 2: In opposition Cameron and Osborne promised to match Labour’s spending before the cisis, and after the crisis took another opportunisic “U” turn. Fact 3. No opposition party saw this coming and certainly not the Conservatives.
        Fact 4. While Labour’s controls on the banks were totally inadequate (hindsight being such a great thing), the Tories in opposition (Cameron and Osborne again) opposed any control at all on the banks. It would have been a nasty state intervention on the pure world of finance. Again another opportunistic U turn after the events sees the same players blaming Labour.

        Ask youself this – is anyone seriously blaming the Tories for the problems of the Euro, another international problem that came about while a party in the UK was in power? Answer is no, but if we played on a level playing field then the press would talk of Cameron’s Euro crisis. Ridiculus? Yes. But just as barking as saying “Labour’s recession” and “Gordon Brown’s” crisis.

        However, the cuts are the responsibility of this current government and they clearly are not working, are costing more than they save, and are causing massive unemployment and overall economic shinkage. Moreover in terms of who each cut hurts and who benefits, they are manifestly unfair, and carried out without electoral mandate and under the cover of “an emergency”.

        So let’s stop joining in the Tory myth that Labour are economically inept and that somehow the Tories are in there sorting it all out.

        As for Labour doing better – yes! Less cuts, more jobs and more people paying taxes. The transaction tax that Cameron bust up Europe over would be a great place to collect some funds to kick-start it again.

        • treborc

           You could not see anything wrong with banking, your not telling me you sat at home watching the billions in banking bonuses payments, the billions upon billions being used to buy up other companies and you did not say to your self come on this cannot go on.

          But even if you said OK the banking crises was about debt which our banks bought up like  no tomorrow, the housing crises was an explosion  waiting to happen and labour has set the fuse.

          And then you had the devil in disguise telling us we did not like people getting rich.

          Sorry I cannot believe that Parliament with all those advisor did not say what most of us could see on the news at night.

          then you had brown with all his errors in taxing the poorest, DLA not being worth it, his 90 detention, his gold sell off.

          labour had reach it’s end it was tired it was boring and it had little to offer, the thing is labour should have gotten rid of the saviour of the world a year before.

          • Jeremy_Preece

             No I do not defent GB and his aboliiton of the protection of taxing the poorest.  I did not rate tuition fees much either.
            He was not a good PM and from the start when there was a Brown bounce he could have called and won an election. He neither called an election, not quashed the idea of an election until late, and then looked like he was always on the back foot – running from the electorate.

            The fundamental flaw was in making GB heir apparent from 1997. DM (who is so loyal) could and should have made a challenge to take over from Blair.

            The point still remains that Cameron didn’t see it coming and would have done nothing different – other than be caught out and react more slowly.

            Brown did manage to mitigate the aftermath and actully saw us come out of recssion and also managed to keep unemployment under control.

            Therefore – and I stand by my main point – Cameron should not have been allowed to get away with a U-turn and take credit for sorting it all out, when actaully he and Osborne have simply made it all much worse. Why sould the Conservatives get a reputation for being trustworthy with the economy?
            More to the point, why has our leadership allowed the Tories to get away with it.  

  • Labour has a real chance of projecting to the pubilic that the cuts
    are too deep and too fast and risk the UK loosing its AAA rating.
    Therefore the Tories are a party not of economic competance, but of
    stagnation, lack of growth and one that faces a possible own goal of
    loosing AAA rating.

  • trotters57

    You clearly live in the south of england which only accounts for 15% of the population.
    There has been no recovery nor will there be in the next few years for most of the country. 

    More than 3 million unemployed, part time work, higher interest rates on the way, more repossessions.

    I can’t for the life of me understand where you get your ideas from but the real world doesn’t come to mind.

  • Richard Murphy

    I regret that Adam Lent simply has this wrong.

    According to the IFS While 73% of the tax increases have already come into force, only a third of the cuts in investment spending, 12% of the benefit reductions and 6% of the planned fall in non-investment public spending have taken effect.

    In other words his whole premise on the current economic situation and people’s perception of it is hopelessly wrong. 

    As wrong as his analysis in In the Black Labour was, I have to add – which so missed the point it would have been laughable if it was not so damaging. 

  • Dave Postles

    Any suggestion of an improving economy is, IMHO, speculative and precipitate.  If it’s predicated on the decline of the headline rate of CPI from 4.2 to 3.6, it merely reflects the acceptance of higher inflation caused by the increase of VAT.  The effect on the consumer is not the realization of a lower rate of inflation, but the stickiness of price increases over the last couple of years.  Diesel prices are high which will be passed on to the consumer.  The activity in the retail sector reflected: 1 discounting at a heavy level from pre-Christmas through into January; 2 an annual comparison with a poor period affected by snow; 3 we only have data about footfall and volume, not value.  We do not understand banks’ exposure to non-sovereign debt in the Club Med countries.   Whilst there are many businesses sitting on large capital accumulations, there are many others which have immense corporate debt accumulated in the 90s (corporate debt is one of the largest components of UK indebtedness).  IMHO, we need to await the first and second quarter data.  Even if growth improves to the 2% level in the second part of the year, it will not, it is suggested, counteract the consequences of austerity on the deficit.  The mantra of people is increasingly: what is the strategy for growth and employment?

    • TomFairfax

      That mantra you mention has been coming from the anti-Cameron Telegraph for about fifteen months. He hasn’t got many friends. They also go on endlessly about George being a part time Chancellor.

      Key factors this year to confidence will be a boost from the Olympics, via increased domestic and overseas tourist expenditure, but mainly if we don’t make a complete cows @rse of the organisation in and around it.

       Will that be enough to negate the effects of falling real term wages? Currently the Tories are betting the family silver on it, which seems a bit desperate.

      Eurozone could negate growth elsewhere, so it is a tad risky to make any conclusions at this stage.

  • PurpleBooker

    I don’t think that’s very fair, Adam. The likelihood is that economy won’t pick up, we are losing our AAA rating and growth is extremely sluggish. Also, many voters do agree with Labour on the central point that the cuts are “too far and too fast” but they do not trust Labour with tackling the deficit, because the Tories have spun a myth about how we created loads of debt.
    Though, I welcome some of the arguments made in ‘In the Black Labour’, we have to thoroughly confident in our basic Keynesian economics. We got it right in 2009 during the crash, and we will get it right again since the slowdown is slower than it should have an debt is greater under this government. I think we need to talk more on cuts, but I don’t think we’re wrong to oppose these cuts.

  • Howard Reed

    I have to say that I think that Adam’s analysis is dangerously wrong in economic terms. When Ed Balls said in his Bloomberg speech in August 2010 that co-ordinated austerity across the Eurozone could lead to a disastrous double-dip recession he was widely ridiculed by the Coalition and the Labour right. Eighteen months later, we find that he was absolutely on the money. For sure, austerity isn’t the only problem facing the economy – climate change and natural resource constraints are going to be an increasing factor over the next few decades. But anyone with even a basic understanding of Keynes knew in 2010 that co-ordinated austerity would be a disaster. And so it has proved. And there seems to be much more risk that the next few years will surprise on the downside rather than the up. For example, disorderly default by Greece or Portugal could make Lehman Brothers and 2008 look like a Tea Party. 

    George Osborne is totally out of his depth and the two Eds’ economic critique is a powerful one. It’s not enough to win the next election by itself – they need a properly worked out and radical economic policy for that. But abandoning the economic critique of the ConDems, when Labour is being proved more right every day that austerity was a mistake, would be insane. Adam’s preferred option of capitulation to Osbornomics wouldn’t solve Labour’s credibility problems on the economy. It’d make them worse. 

  • Brumanuensis

    As others have pointed out, this is a ‘heads they win, tails we lose’ sort of article. It is true growth will probably recover over the year, but betting the house on an up-tick based on two months of data is foolish. The BoE’s forecast of ‘zig-zag’ growth is arguably about right and the 2nd Quarter, as they’ve acknowledged, will probably be weaker, due to disruption from the Diamond Jubilee – a la Royal Wedding last year – and the natural deleveraging process after three months of debt-fuelled Christmas consumption. As Dave Postles points out, our data on sales value is limited and it’s also worth recalling that 2 weeks ago the British Retail Consortium was reporting a 0.3 drop in sales during January, the 2nd worst figures for seventeen years. February is traditionally a bad month, so a drop next month won’t necessarily prove the converse, but let’s bear in mind here that wages aren’t likely to rise any time soon and further cuts in benefits from March onwards will additionally constrain household incomes. 

    Ulitmately, even if consumer spending recovers, on current trends it will be based on the same excessive private indebtedness that helped create the financial crisis. That’s not a solution to our economic troubles and the shallowness of the foundations would be exposed the moment interest rates went up. The only good signs are on manufacturing, where falls in factory-gate inflation are definitely assisting the recent upturn. However even this is vulnerable to outside factors – i.e. China’s slowdown, the imminent Greek default, etc. In short, the economy will recover, but a sluggish recovery won’t do much good for the government. It won’t automatically do much good for Labour either, as you are right to say, but let’s not throw out Labour’s strategy on the basis of a few jitters or a fear of public misperception.

  • I’m so bored with reading negative material on here
    First, this is always the way – oppositions don’t win elections, governments lose them, and we are not in a position to be able to control what the government does
    Second, this being the case, we have to create an impression of what differs about Labour and what makes us distinct from the ConDems. Triangulation is a disastrous option with a coalition in government
    Finally, despite the negativity felt about the last government, we are still polling well, and three years is a long way off

  • GuyM

    And now a large January surplus which makes it look like the government will beat the deficit target for the year by up to £10 billion.

  • treborc

    The problem is of  it was labour that were in power, if they did not see the banking crises they could not fail to see the housing bubble but just did not give a dam.

    labour hoped that they had an election before everything went bang, sadly  it was bef0re and not after the election

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