Alistair Darling famously said in March 2010, that the impending cuts would be “deeper than Thatcher’s”. Yes that’s right, a Labour chancellor, not particularly ‘right-wing’ or ‘New Labourite’, suggesting that he could take the scalpel (or indeed the axe) to the public finances in a way more brutal and decisive than the woman Labour has demonised for decades. Many Labour politicians, no doubt Ed Miliband included, will be rejoicing at the hand of cards dealt to us in May last year; if we were elected we wouldn’t be able to glorify the anti-cuts movement in the way we have been doing, because we would be the ones carrying out the cuts.
Fast forward to the present day, and the Labour blogosphere is making noise about Greg Barker, Tory minister of state for energy & climate change, who is on a visit to the US. Barker apparently told an audience at the University of South Carolina that “We are making cuts that Margaret Thatcher in the 1980s could only have dreamt of”. Not the wisest or most sensitive choice of words, but he’s basically echoing what chancellor Darling said last year. The truth is that any government in power today would have no choice but to cut public spending, in order to restore confidence in the nation’s finances.
If Ed Miliband was the one invited to become Prime Minister last May, where would the wider Labour Party stand on the cuts that he and his chancellor would be carrying out right now? Would we be accusing the Labour government of outright Tory-ism and a heartless attack on the poorest? No. Of course, Labour’s austerity programme would have been enacted slightly slower than the coalition’s current plans, but have no doubt, there would have been deeply unpopular service reductions and cuts under a Labour government.
Chancellor Balls wouldn’t have the luxury to be profligate. You can’t spend money you don’t have, and the quicker you get rid of a large budget deficit the better in the long term. Slower payments mean spending more on interest and running the risk of bond markets losing confidence in Britain; both of those things would over the coming years result in even deeper cuts and the potential of a damaging downward spiral leading to something more like a depression than a recession. The great Keynesian he claims to be would be outed as a charlatan who picks and chooses from different economic theories when it suits him; where was the Keynesian in either Ed when they were at the Treasury, ramping up public spending in the belief that we would never again see an economic crisis?
Labour now needs to go away, re-build its intellectual base and offer a genuine apology for the economic mess we have contributed to. Whilst many of the Tory cuts are unpopular, a large portion of the population still believes that Labour’s mis-management of the economy from 2005-2007 is a major contributing factor to those cuts. We need to convince the country once again that we can be responsible with the economy. Perhaps we should be looking at Chile & Australia; in Chile it’s illegal to run a deficit if the country is at full employment, and both nations have statutory ‘stability funds’ which get topped up in the good times to cover spending in the hard times. These should be the kind of policies we are putting forward now, not just a shallow, hypocritical and baseless attempt to demonise the government for sorting out the economic mess which we in large-part contributed to.
Greg Barker’s choice of words are unfortunate. Perhaps he forgot the rule of 21st century politics; that something you say on a ministerial visit to America will almost certainly find its way back to Westminster. But let’s not forget what esteemed Labour politicians have also said on the matter, and let’s not go about pretending that we wouldn’t be cutting ourselves if we were in power today.